England: Five year ban for surveyor who destroyed company papers

A surveyor has been banned for five years after failing to provide adequate accounting records and not complying with tax obligations.

Keith Alan Da Costa (64), of Manningtree in Essex, was the sole director of KAD Consultants Limited since its incorporation in May 2011.

The company traded as surveyors providing services to general building contractors and the construction industry until it went into liquidation in June 2017.

KAD Consultants’ liquidation, however, triggered an investigation by the Insolvency Service before investigators uncovered instances of misconduct.

For the last 15 months of trading, Keith Da Costa did not maintain adequate accounting records which made it difficult to determine legitimate trading activities.

During this period, the company bank account revealed that in excess of £177,000 had been paid in and removed but it was not possible to determine whether this was legitimate business income and expenditure.

Payments of almost £76,000 were made to three individuals, including more than £40,000 detailed as wages, but investigators were unable to verify whether these payments were for genuine business expenditure or wages.

Investigators were unable to establish the number of company employees, nor the level of remuneration taken by Keith Da Costa. The 2016 company accounts revealed Keith Da Costa owed the company just over £91,000 in the form of loans but at liquidation, the statement of affairs signed by the director showed none of his loans being outstanding.

Further enquiries uncovered that from at least November 2015 onwards Keith Da Costa’s surveyors firm had not paid VAT, Corporation Tax and PAYE. At liquidation in excess of £133,000 was outstanding to the tax authorities.

Legal proceedings at the High Court were initiated by the Insolvency Service acting on behalf of the Secretary of State for Business, Energy and Industrial Strategy. On February 17, however, the day before the trial was due to recommence, the Secretary of State accepted a five-year undertaking that bans Keith Da Costa as acting as a company director.

In his undertaking, Keith Da Costa did not dispute that he failed to ensure KAD Consultants Limited maintained and/or preserved adequate accounting records or in the alternative failed to deliver these up to the liquidator and that he traded KAD to the detriment of the tax authorities. He also agreed to pay costs of more than £20,000.

The disqualification starts on March 10 and means Keith Da Costa is banned from directly or indirectly becoming involved, without the permission of the court, in the promotion, formation or management of a company.

Lawrence Zussman, deputy director of insolvent investigations at the Insolvency Service, said: “Despite numerous requests from the liquidator, Keith Da Costa produced very little in terms of his business’s accounting records and eventually admitted he had shredded his company’s paperwork as he considered it was no longer of any use.

“Such behaviour by Keith Da Costa was in flagrant breach of the Companies Act and along with neglecting his responsibilities to deal with his company’s taxation affairs has demonstrated he is unfit to be a company director and has been removed from the business environment for five years.”

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