Two bosses of a letting agent have been banned from being directors for a total of 12 years for failing to give back deposits to their tenants.
Joseph Newman, 73, and Kerry Sebestyen, 30, were directors of Joseph Richards Limited in Canterbury, which ceased trading in April 2012 owing more than £400,000 to creditors.
From its base at 74 St Dunstans Street, the company collected deposits and rents on behalf of landlords and owed more than £100,000 to tenants and landlords for deposits when it went under.
Joseph Richards Limited owed more than £100,000 to tenants and landlords for deposits when it went under
After an investigation by the Insolvency Service, Newman admitted he failed to deal with 92 deposits taken by Joseph Richards Limited, totaling £119,778.
Instead of protecting them, as he was required to by law, he used the money as part of the company’s general funds.
Sebestyen, who resigned as a director in June 2011, admitted the same offence, failing to deal with 28 deposits totaling £32,238.
The disqualifications means Newman and Sebestyen may not be directors of a company or be involved in the management of a company in any way for seven and five years respectively, unless they have permission from court.
Insolvency Service chief examiner David Brooks said: “The undertakings signed by Mr Newman and Ms Sebestyen send a clear message to other company directors.
“The Housing Act 2004 places those who receive tenancy deposits under clear obligations to protect tenants and landlords from loss.
“If your company has failed and you have not taken seriously your responsibilities as a director when dealing with tenancy deposits, the Insolvency Service will investigate you and you could be removed from the business environment.”
Incorporated in September 1996, Joseph Richards Limited was placed into voluntary liquidation in April 2012 with a deficiency of £413,421.
Of this, £113,346.24 was owed for deposits taken from creditors.