The powers of the Company Investigations arm of the Insolvency Service derive from the Secretary of State for the Department of Business, Energy and Industrial Strategy under the Companies Act 1985 (‘the Act’).
When Can An Investigation Take Place? | Kangs Company Offences Defence Solicitors
Under section 432 of the Act, the Secretary of State can appoint an inspector(s) to investigate the affairs of a company if it appears that the company is being conducted:
- with intent to defraud creditors or the creditors of any other person,
- for a fraudulent or unlawful purpose,
- in a manner which is unfairly prejudicial to some part of its members or where any actual or proposed act or omission of the company is or would be so prejudicial,
- where persons concerned with the company’s formation or management have been guilty of fraud, misfeasance or other misconduct towards members,
- where company members have not been given all the information which they might reasonably expect
Investigation Procedure | Kangs Corporate Offences Defence Solicitors
- section 447 of the Act provides the Secretary of State may direct, or the investigator so authorised by the Secretary of State may give directions to a company/or any other person to produce documentation or information required.
- section 448 of the Act provides a search warrant can be obtained if there are reasonable grounds for believing:
- there are on any premises, documents where production has been required but which have not been produced,
- an offence has been committed for which the penalty on conviction on indictment is imprisonment for a term of not less than two years and there is documentation on any premises relating to whether the offence has been committed,
- that if production was so required the documents would not be produced but would be removed from the premises, hidden, tampered with or destroyed. that the investigator has the power to require the production of it and it will be removed, tampered with or hidden.
- Company Investigators may also seek to obtain information by interviewing directors/company officers.
- Investigations can be instigated by a complaint made direct to Company Investigations by another company/member of the public, or information provided by another investigating body.
Possible Investigation Outcomes | Kangs Director Disqualification Solicitors
- The investigation may show that there is no need for any action.
- If in the public interest, the company can be wound up.
- The conduct of directors may be such that they could be disqualified from being a director.
- Information obtained as part of the investigation may be passed to various prosecuting authorities/regulatory bodies to deal with.
- The directors/company may be warned to improve their conduct of the business.
Consequences Of Not Co-operating | Kangs Insolvency Solicitors
- If the investigation is frustrated by the directors, they can be found in contempt of Court, fined/imprisoned and ordered to pay costs.
- Intentionally obstructing a warrant or, without reasonable excuse, failing to comply with any requirements imposed, create a separate criminal offence which can result in a fine if convicted on indictment and a fine up to the statutory maximum on summary conviction.
How Can We Assist? | Kangs National Corporate Offences Defence Solicitors
The Team at Kangs Solicitors is able to assist at every stage of any investigation concerning any company activity of any nature or any allegations against any director or other company officer.
The team at Kangs Solicitors is led by Hamraj Kang, ranked as a ‘star individual’ in Chambers UK for five consecutive years for his work in defending financial crime cases.
We are here to assist and happy to provide an initial no obligation consultation at our offices in London, Birmingham and Manchester or by telephone/video conferencing.