Tag Archives: [2012] CSOH 85

Will Craig Whyte and Other Directors of Rangers Face Disqualification for £14,000,000 Unpaid Tax?

In which I comment on the Directors of Rangers Football Club PLC over the last year, and in light of a recent case decided by Lord Hodge, have a look to see if any of them might be at risk of disqualification for the non-payment of PAYE, NIC and VAT.

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One of the consequences of the decision of HMRC, of which I will write elsewhere, is that the liquidators, BDO, will be obliged to carry out a formal inquiry into the circumstances of the insolvency of Rangers Football Club PLC. This includes the actions of present and past directors and can lead to various possible outcomes. These are not mutually exclusive.

There can be criminal prosecutions of office holders, if there is evidence of criminal conduct (not an allegation which has yet been made by any official body); the parties investigated can be pursued in the civil courts for losses caused to the now insolvent company, where they have failed in their legal duties; and the Secretary of State for Business Innovation and Skills can initiate proceedings to disqualify the directors from holding such positions. Section 6 of the Company Directors Disqualification Act 1986 applies here, and is shown at the foot of this article.

It is also the case that shareholders of an insolvent company can, in certain circumstances, bring civil proceedings for damages against officers of the company, alleging that breach of duty has caused them losses. On the basis tough that shares in Rangers were seen as financially worthless when Mr Whyte took over the company last year, it is hard to see how even a shareholder like Mr King, owning 10% of the shares, can claim to have suffered a loss. Continue reading

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Filed under Administration, Craig Whyte's Companies, Rangers, The Company Directors Disqualification Act 1986.