Two men have been disqualified for a combined total of 23 years after transferring more than half a million pounds from their own debt management companies.
Andrew Brooke, 45, and Gary Gregson, 38, have been disqualified for 13 and 10 years respectively and are now prevented from acting, directly or indirectly, as directors of companies.
Mr Gregson was the main director of Gregson and Brooke Financial Services Ltd (GBFS) and One Tick Ltd (OT), which provided debt management services to people in financial distress, helping them to come to agreements with their creditors and pay down their debts.
The companies, which operated through various different trading names including Expert Money Solutions, received payments from customers into debt payment plans and offered a "credit resolve" product, which attempted to challenge the enforceability of credit agreements signed by their clients, as well as reclaiming PPI payments.
Mr Gregson agreed not to withdraw fees, other than to pay staff, after a visit by the Financial Conduct Authority but then proceeded to transfer £210,006 from GBFS and OT to himself and third parties he was connected to, before resigning his directorships.
The firms then came under the stewardship of Mr Brooke, who was reappointed as a director of the companies on 20 August 2014, but the FCA continued to have concerns and issued supervisory noticed to both firms, but he proceeded to transfer a total of £442,000 to another company he was a director of before both GBFS and OT entered into administration in October 2014.
Robert Clarke, head of insolvent investigations north for the Insolvency Service, said: "The real victims here are Brooke and Gregson’s clients who sought genuine assistance to help manage their debts but many received little or no benefit at all from instructing the companies to act on their behalf.
"Brooke and Gregson clearly put their own interests ahead of their clients. The vast amount of money they transferred out of their companies and their timing as the net was closing in from the FCA showed a cynical disregard for the needs of their customers.
"I would also like to thank the FCA, whose cooperation was crucial in securing these disqualifications."
Although the services they offered were legitimate, GBFS and OT would pay minimal contributions to the credit providers from their clients’ debt payment plans, while keeping a significant portion of their clients’ money to go towards ‘service fees’.
Some customers complained to the Financial Ombudsman Service that their debts had increased, despite having paid money into their debt payment plans.
The FCA visited the offices of GBFS and OT in July 2014 and as a result the firm agreed to stop accepting new customers and agreed not to withdraw fees.
The regulator also warned Mr Gregson that the companies could be closed down after they were unable to provide adequate records of how much money was being held on behalf of their clients.
Mr Gregson, who lives in Manchester, was disqualified by the court for 10 years, beginning on 7 March 2018, for a lack of commercial probity and failure to ensure the debt management companies, including another failed company, Gregson and Brooke Ltd, adhered to guidance issued by the regulator.