Quizzes & Puzzles26 mins ago
possible fraud? sounds dodgy to me
4 Answers
A ltd company owes money to me and have gone into liquidation. However after doing some research into this company the reason why they have gone into liquidation is they have a creditor who they owe a huge sum of money to. The same person is the director of both companies!!
is this legal? Does this sound above board?
is this legal? Does this sound above board?
Answers
Best Answer
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For more on marking an answer as the "Best Answer", please visit our FAQ.It's not that unusual for a company director to prop an ailing company up with his own personal money or even that of another company he's involved with. Under those circumstances it would be wise for them to duly note it which they have, so I don't think anything fishy, just very unfortunate for you I'm afraid.
Perfectly normal. I have lent sums to one of my companies, of which I am a director. It has now ceased trading. The only way I am going to get that back is to sell the company's freehold and other assets , either by winding it up to see how much of the loan is recoverable, or, if that sale is sufficient to meet the debt, leave the company as a shell.
I'm afraid that this is a common situation in the current recession.
I'm afraid that this is a common situation in the current recession.
As has been said a limited liability company has its own legal status, which has nothing to do with the Directors and shareholders of that company who are not liable for the debts of the company which has limited liability. The company should not trade whilst insolvent and is now in liquidation; you are probably an unsecured creditor and stand little chance of receiving your money. Unfortunately this occurs very frequently when the same Directors/shareholders may start another limited liability company often with a similar name, it is doubtful, from what you say, that any offence has been committed, the morality of this action may be in question if this tactic is used to only obtain a fresh start without the previous encumbrances, leaving others with the loss.
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