Contractor Banned After Disposing Of Assets Prior To Bankruptcy

Scaffolding around a house

A warning to any business owners that think they can spend, spend, spend prior to bankruptcy to avoid paying creditors has been sent by the Insolvency Service.

A Warwickshire scaffolder has been banned for four years after recklessly spending £142,000 prior to going bust.

Colin Gerrard Taylor was the director of Godiva Environmental Solutions Ltd, a scaffolding company based in Coventry. The company ceased trading in May 2020 after suffering financial difficulties and was voluntarily wound up in June 2020.

Taylor, however, was liable for personal guarantees he had given against company debts. He applied for his own bankruptcy in July 2020 declaring debts totalling more than £1.8 million.

As Trustee of Colin Taylor’s bankruptcy, the Official Receiver investigated the scaffolder’s affairs and found that, prior to his bankruptcy, he made substantial cash withdrawals. From February 2020 until his bankruptcy in July 2020, Taylor paid £77,500 to an unlicensed money lender, more than £60,000 was transferred to family members and he lost £5,000 gambling.


Extra ban

Bankrupts are usually put under restrictions for 12 months. due to Taylor’s spending prior to his bankruptcy, the Official Receiver determined that the scaffolder was a risk to future creditors and sought to apply for additional restrictions - totalling four years.

Taylor has signed a bankruptcy restriction undertaking acknowledging that he entered into transactions, whilst insolvent, which were to the detriment of his creditors. The undertaking came into effect on 3 March 2021 and for 4 years he is subject to further restrictions, including being banned from becoming a company director or managing a company and not borrowing more than £500 without informing the lender of his bankruptcy orders.


 “Colin Taylor owed £1.8 million at the time of his bankruptcy but despite this, he spent significant funds on family members, gambling and paying an illegal money lender.”

– Karen Fox 

Deputy Official Receiver, Insolvency Service


Treat their creditors fairly

“His reckless actions denied his creditors money he owed them," continues the Insolvency Service's Fox. "This type of behaviour is totally unacceptable and we will not hesitate to take further action against bankrupts who do not treat their creditors fairly.”

Picture: For illustration purposes only - a scaffolder has been banned for four years after recklessly spending £142,000 prior to going bust.

Article written by Cathryn Ellis
01st April 2021


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