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Individual's UK company directorships and accounts - cause for concern?

  • 12-12-2011 10:25am
    #1
    MrThrifty
    Registered Users, Registered Users 2 Posts: 491 ✭✭


    I decided to post this in Accountancy rather than Legal Discission as I'd say it comes up more in the job here. Basically, I am thinking of 'doing some business' with someone from the UK who presents himself as being a very wealthy businessman. However, something didn't feel right and so I started googling his name and address to try to find out more about him (:o). Anyway, through one of the many websites offering/selling registered company information (e.g. http://companycheck.co.uk/index.php), I was able to establish pretty quickly that he had director and secretary appointments in around 10 companies in the last 10 years.

    At that point, I became concerned as the nature of the companies was extremely varied - even the ones he clearly owns and is director of are in totally different types of business. Also, these companies are all registered to his home address, i.e. not a business facility, but perhaps this is normal practise. Around half of the companies listed are now dissolved and there are no reported accounts online for them.

    The other companies bizarrely all show the same amounts in the balance sheet info reported year after year. These amounts are:

    - Cash in bank: £50
    - Net worth: -£215
    - Total current liabilities: £265
    - Total current assets: £50

    I at first went looking for '000s' to be printed somewhere to indicate that £50 was really £50,000 but no, £50 is just £50. These amounts make no sense in relation to the types of business involved. And also the fact that they don't change annually is bizarre, to me at least...

    Is this unusual? Or is it all related to some well-known tax loophole or avoidance measure for companies in the UK? Alternatively, could the companies involved be registered for legal reasons but operating totally on a 'cash under the counter' basis?

    Bottom line, is there cause for concern or further investigation?!


Comments

  • #2
    dbran
    Registered Users, Registered Users 2 Posts: 2,094 ✭✭✭dbran


    Hi

    Generally if things do not feel right then they usually arn't.

    It sounds like your friend is setting up dormant non trading companies. But there could be any number of reasons for doing this.

    Kind Regards


    dbran


  • #3
    MrThrifty
    Registered Users, Registered Users 2 Posts: 491 ✭✭MrThrifty


    Interesting... Some of the old undissolved companies in question are indeed classified as dormant all right. Of interest to me are the latest 2 companies he has set up within a month of each other earlier this year, but there is no financial info on record yet for these because the end of year submission has yet to happen.

    I don't suppose it's possible for Joe Soap me to check an individual's credit rating, if you know what I mean?


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