If you were approached by a potential client (Mr X) to take on the bookkeeping for their compnay. You had numerous meetings with Mr x, he was the person giving the orders so to speak, but was not a director of the company. The director was his manager, who was simply a figurehead.
You later discover that Mr X is a disqualified director, what do you do?
It doesnt really fit into money laundering, I don't think, but is certainly illegal under s1 Company Directors Disqualification Act 1986. What do you do?
Note this question is hypothetical and any resemblance to an actual circumstances is a coincidence
Personally, I would not take it on. It would always worry me that if they are willing to do business in this way, what other rules, would they be willing to bend? He obviously has little regard for the law, and there is a reason he is disqualified.
Ooh, legal dilema's, we don't get many of those on the site.
right, it's obvious that the new director is merely a puppet and the real power remains with the person no longer entrusted to hold the position of director but is still fulfilling the role.
The disqualified director is in breach of the company directors disqualification act (1986) if they either directly, or indirectly, become concerned or take part in the promotion, formation or management of a company. (just highlighted a couple of key words there).
Under the offence the disqualification then changes to also include a fine and / or up to two years imprisonment.
Amanda, it's generally Fraud that causes disqualification but there are other reasons such as persistently ignoring filing rules.
With a few exceptions any director who is disqualified who got there via accountancy training would automatically be disciplined (fined and expelled) by their supervisory body.
HTH,
Shaun.
p.s. a more interesting scenario is where would a financial professional strand with their supervisory body if they knowingly took on work for an entity where this was the situation?
I'm suspecting that unless you report the situation to your supervisory body then you would also be in a lot of trouble and looking at a fine and possible expulsion.
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Shaun
Responses are not meant as a substitute for professional advice. Answers are intended as outline only the advice of a qualified professional with access to all relevant information should be sought before acting on any response given.
I've got this freind whose got this rash and he was wondering...
Sure that's not the case here though
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Shaun
Responses are not meant as a substitute for professional advice. Answers are intended as outline only the advice of a qualified professional with access to all relevant information should be sought before acting on any response given.
