Karl Williams, owner of Coldseal, disqualified for 11 Years,

Karl Williams - whose Coldseal Group went bust with debts of £7,745,372 - has been banned from acting as a company director for 11 years. According to the Insolvency Service Williams payed himself £750,000, another £250,000 disappeared into the hands of two overseas companies and £850,000 went to fund his hobby, non-league Hornchurch football club.

The company structure included Coldseal Group Ltd, Ambergate Financial Services Ltd, Bluebell Glass Ltd, Coldseal (Manufacturing) Ltd, Coldseal (North) Ltd, Coldseal (Midlands) Ltd, and Coldseal (South) Ltd, all now in liquidation.

From 23 August 2003 and 12 December 2003 between £291,000 and £1,461,014 was unpaid for PAYE/NIC and between £871,309 and £1,909,827.33 was unpaid for VAT. Between 29 August 2003 and 12 December 2003 no less than £8,658,539 was paid out of Coldseal Limited’s bank account with HSBC (in respect of payments in excess of £100,000 alone) at a time when no payments were being made to HMRC for PAYE/NIC and VAT.

From no later than 1 October 2003, he was aware that it was proposed Coldseal Limited would sell its business to Coldseal Group Limited under a sale agreement which would transfer all of Coldseal Limited’s assets and liabilities save primarily for its liabilities to HMRC: this transfer was completed on 12 December 2003. During this time he failed to take steps to ensure HMRC would be paid its current liabilities prior to the sale.

Having been a director of Coldseal Limited which failed to make any payments in respect of its current liabilities for PAYE/NIC and VAT for the period 23 August 2003 to 12 December 2003, he caused no payments to be made by Coldseal Group Limited to HMRC throughout the substantive period of its trading life, i.e. between 13 December 2003 and 14 July 2004.

No less than £1,651,565 and no more than £2,062,993 was unpaid for PAYE/NIC in respect of the period 13 December 2003 to 14 July 2004 and £829,909 was unpaid for VAT in respect of the period 13 December 2003 to 14 July 2004.

At the date of Coldseal Group Limited’s liquidation, HMRC represented over seventy percent of third party creditors.

Between 2 February 2004 and 2 July 2004 £31,203,866 was paid out of Coldseal Group Limited’s bank account with HSBC of which no less than £14,573,753 was in respect of wages, installation and self employed staff and £10,682,519 in respect of regular suppliers at a time when no payments were being made to HMRC for PAYE/NIC and VAT.

Additional payments of no less than £1,825,000 were made from Coldseal Group Ltd’s bank account at a time when no payments were being made to HMRC throughout its trading life as follows: no less than £750,000 to him personally, £225,000 was paid to two overseas companies for no apparent consideration and £850,000 to Hornchurch football club.

From no later than 9 June 2004 he was aware that it was proposed Coldseal Group Limited would sell its business to The Carthium Group Limited which sale agreement would transfer all of Coldseal Group’s assets and liabilities save primarily for its liabilities to HMRC: this transfer was completed on 14 July 2004. During this time he failed to take steps to ensure HMRC would be paid its current liabilities.

He caused Coldseal Group Limited to fail to meet its statutory obligations in that between 13 December 2003 and 14 July 2004 it failed to file returns in respect of VAT or to make any payments of PAYE/NIC and VAT.

Between 15 July and 2 November 2004 he caused Ambergate Financial Services Limited, Bluebell Glass Limited, Coldseal (Manufacturing) Limited, Coldseal (North) Limited, Coldseal (Midlands) Limited and Coldseal (South) Limited (together 'the Carthium group') to fail to make any payments or to make provision for payments to HMRC for PAYE/NIC and for VAT.

Having been a director of Coldseal Limited and Coldseal Group Limited which failed to make any payments in respect of its current liabilities for PAYE/NIC and VAT for the total period 23 August 2003 to 14 July 2004 he caused no payments to be made by the Carthium group to HMRC for these liabilities throughout the substantive period of the trading life of these companies, i.e. between 15 July 2004 and 2 November 2004.

No less than £667,921 remained unpaid for PAYE/NIC in respect of the period 15 July 2004 to 2 November 2004 for the Carthium Group. § £41,816 was unpaid for VAT in respect of the period 15 July 2004 to 2 November 2004.

The Carthium group failed to maintain sufficient summary records from which it is possible to determine the level of payments made in relation to each company within the Carthium group. However, a cashflow statement exists in relation to all of the companies in the Carthium group together with six further companies which formed the whole trading group and which carried on the substantive business of the earlier businesses of Coldseal Limited and Coldseal Group Limited.

This shows that from 12 July 2004 to 28 October 2004 £18,693,723 was paid in respect of which £6,158,507 was paid in respect of 'installation and PAYE wages' and £5,207,029 in relation to 'suppliers- regular'.

He caused the Carthium Group to fail to meet its statutory obligations in that between 15 July 2004 and 2 November 2004 it failed to file returns in respect of VAT or to make any payments of PAYE/NIC and VAT.

Whilst there were substantial trade creditors on the liquidation of the Carthium group, no payments were made to HMRC in respect of its liabilities throughout the trading life of these companies which were the successor companies to Coldseal Limited and Coldseal Group Limited which similarly failed to make any payments in respect of their current HMRC liabilities.

Following the liquidation of Coldseal Limited on 2 February 2004, he acted as a director of Coldseal Group Limited which traded with a prohibited name for the period to 14 July 2004 and that he thereafter acted as a director of Coldseal (Manufacturing) Limited, Coldseal (North) Limited, Coldseal (Midlands) Limited and Coldseal (South) Limited all of which names were prohibited by virtue of the insolvency of Coldseal Limited.

Following the liquidation of Coldseal Group Limited on 14 October 2004, he acted in breach of section 216 by acting as a director of Coldseal (Manufacturing) Limited, Coldseal (North) Limited, Coldseal (Midlands) Limited and Coldseal (South) Limited which traded to 2 November 2004 and which names were prohibited by virtue of the insolvency of Coldseal Group Limited.