ICSM Business Membership Group: fighting late and non-payment – creditors left high and dry by the fraudulent Atherton Scheme as dodgy firms are shut down

By Harry Mottram: Some call it a cheaper alternative to insolvency practitioners while others call the Atherton Scheme fake insolvency practitioners which leave creditors out of pocket. There have been a number of fraudulent operators who have been preying on struggling firms offering them a way out of the financial problems. The Government has shut down a number of firms under the Atherton name due to the way they undermined the insolvency process and misled directors and owners of companies they could be free of any liabilities.

Chris Worden o of Director First said they told owners of failing businesses this was alegal alternative to insolvency. They would buy the business for £1 and then charge a fee of up to £15,000 to the owners telling them they were now free of the debts. Of course they weren't and the £1 purchase of the firm wasn't legal either. The owners of the business were not only liable for the debts of their firm but they had given £15K to the fraudsters.

The Insolvency Service explained it like this: “The fees Atherton charged clients depended on the level of their company’s liabilities. In cases where the liabilities were more than £500,000 they would charge £15,000 plus VAT.  The companies, which were led by former director John Irvin, made several misrepresentations to prospective clients, suggesting they could retain their company assets while transferring liabilities to the buyers without the risk of consequences. 

“They told customers there would be no requirement for former owners to co-operate with liquidators, insolvency practitioners or the Insolvency Service and that recovery action would not be taken against them by the new directors for any debts due by them to the company in financial distress.  “Other misleading advice included claims that the new company could use the distressed company’s trading names without any need to pay for them and that the books and records of the distressed company could be disposed after the sale. They also advised would-be customers that they could delay providing information to Companies House so they could continue to access the distressed company’s bank account.”

Ian Carrotte of ICSM said directors of the Atherton firms promised something that was too good to be true. He said: “These were people who cynically preyed on desperate people whose businesses were about to go bust. By charging the directors and owners a fee and pretending they could sidestep the debts they were simply taking money from people who were already in a fix and even had the cheek to say they were Insolvency Practitioners. No wonder the Insolvency Service shut them down.”

The Atherton companies were supported by the below five associates who supported their business model by purchasing the companies in financial distress and providing them with new directors. 

• Aguia Group Ltd – director Neville Taylor 
• GPA KLM Ltd – director Karen Mortimer 
• Namare GRP Ltd – directors Neville Taylor and Suzanne Harley-Davies 
• Summers & May Ltd – directors Karen Mortimer and Joanna Seawright 
• TPG GRP Limited – directors Neville Taylor and Suzanne Harley-Davies  

Apart from ripping off the owners of struggling firms, the practice was fraudulent, but also potential legal implications including the duped owners facing prosecution. And most of all the creditors were twice misled that they would be paid.

For more on the scheme visit https://www.gov.uk/government/news/companies-promoting-corporate-rescue-scheme-shut-down-after-undermining-insolvency-regime

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ICSM, The Exchange, Express Park, Bristol Road, Bridgwater, Somerset TA6 4RR. Tel: 0844 854 1850. www.icsmcredit.com. Ian.carrotte@icsmcredit.com