Misleading Corporate Rescue Firms Wound Up After UK Insolvency Investigation
Two corporate rescue firms, Atherton Corporate (UK) Ltd and Atherton Corporate Rescue Ltd, were wound up after misleading directors of distressed companies into believing they could sell their businesses and avoid debts. A UK Insolvency Service investigation uncovered these misleading corporate rescue schemes, leading to the closure of these two firms and five associated companies that undermined the UK’s insolvency regime.
False Corporate Rescue Advice
Under the “Atherton” brand, these firms advertised a supposed legal alternative to formal insolvency via websites like athertoncorporate.co.uk and nationalcompanyrescue.co.uk. Directors were misled into believing they could transfer assets and liabilities to new companies while avoiding debt responsibility. Atherton falsely claimed that resigning as a director before selling the company would protect against legal and reputational harm.
Hidden Fees and Misrepresentation
Atherton charged high fees, up to £15,000 plus VAT for companies with over £500,000 in liabilities, while delivering none of the promised debt protection. Directors remained liable for debts, despite claims that they wouldn’t need to cooperate with liquidators or the Insolvency Service. In some cases, Atherton encouraged delays in filing documents with Companies House, giving former directors access to company accounts after sales—a clear breach of legal processes.
Role of Associated Companies
Five associated companies were central to Atherton’s misleading corporate rescue schemes, facilitating the purchase of distressed businesses and appointing new directors. These companies included:
Their purpose was to create a legal gap between former directors and any liquidation proceedings, complicating the process for creditors.
UK Insolvency Service Investigation and Legal Action
The UK Insolvency Service investigation found that Atherton’s schemes made it harder for creditors to recover debts. The Secretary of State applied to wind up Atherton and the associated companies, and the High Court and Court of Sessions ordered their liquidation. The Official Receiver and Julie Tait of Grant Thornton UK LLP were appointed to handle the winding-up process and recover assets for creditors.
Impact on Directors and Clients
Many clients who fell victim to Atherton’s schemes were left in precarious financial situations, despite paying substantial fees. The winding-up of these firms serves as a reminder to directors to seek advice from licensed, reputable professionals to avoid legal and financial pitfalls.
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