Construction director Mario Huiu failed to account for nearly 拢500,000 transferred out of his company鈥檚 accounts in a one-month period in 2020.
Huiu also failed to verify more than 拢200,000 in cash receipts and explain why his company, Incentive Services Limited 鈥� originally called EMA Dry-Lining Ltd 鈥� failed with debts of more than 拢160,000.
The 39-year-old, of Hayesbrook Road, Ilford, was prosecuted for offences under the Companies Act 2006 and Insolvency Act 1986.
He was given a four-month prison sentence, suspended for 12 months, when he appeared at Thames Magistrates鈥� Court on Friday 13th June.
Incentive Services Limited was incorporated in March 2017 under the name of EMA Dry-Lining Ltd. The company changed its name three times before settling on Incentive Services Limited in May 2020. Huiu was sole director of the company when it went into liquidation seven months later in December 2020.
As director of the company, Huiu was required to maintain and preserve company books and records and deliver them to the liquidator.
His failure to do this meant the liquidator was unable to verify transfers of 拢498,480 from the company鈥檚 account between May and June 2020.
Huiu鈥檚 explanation during interview that the money was spent on paying suppliers was uncorroborated and described by the Insolvency Service as 鈥渘ot credible鈥�.
Similarly, unverified cash receipts of 拢261,960 into the same company bank account did not have supporting sales records.
Four other company bank accounts were identified during the course of Insolvency Service investigations. Huiu did not declare them all to investigators. Huiu鈥檚 failure to deliver books and records to the liquidator meant the true level of the company鈥檚 financial turnover could not be verified.
The reasons why the company failed owing creditors 拢162,482 were also not explained due to the inadequate accounts.
Huiu was disqualified as a company director for six years in November 2021 following initial Insolvency Service investigations into his misconduct at Incentive Services Limited.
Mark Stephens, chief investigator at the Insolvency Service, said: 鈥淟imited liability companies provide vital protection for business owners, but this protection comes with serious responsibilities. Maintaining proper accounting records is not just a legal requirement 鈥� it is essential for responsible business management.聽
鈥淒irectors such as Mario Huiu who fail to keep accurate financial records put their creditors and trading partners at unacceptable risk and jeopardise their own ability to make sound trading decisions.鈥�
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