Wealthy play bankruptcy system to stay rich
Undercover probe shows they also flout firm directorship ban
CROOKS and businessmen are exploiting weaknesses in the bankruptcy system to keep hold of their cash, it has been claimed.
A BBC programme found former millionaires enjoying lavish lifestyles, seemingly untouched by insolvency.
Convicted fraudster Barry Hughes declared himself bankrupt in 2014 owing £10million and claiming he had no assets. But the ex-boxing promoter was seen driving a line of luxury cars worth £500,000.
Ex-mining tycoon Graham Gillespie failed to disclose assets during his £12.8million bankruptcy. One asset being sought was private registration plate GG1, worth £180,000, which he said he had sold to pay a gambling debt.
But just months ago, the BBC filmed him at Gleneagles Hotel, Perthshire, driving a new Bentley – with GG1 plate. The men refused to comment. BBC Scotland Investigates: Millionaire Bankrupts Exposed, which screens on BBC1 tonight at 8.30pm, also found weaknesses in the system designed to punish those who try to hide assets.
A bankrupt can be given a Bankruptcy Restriction Order.
Under the order, which can last 15 years, they are banned from being a company director or giving the impression of being one.
Malcolm Scott, a former treasurer of the Conservative Party in Scotland, was given a BRO in 2015. He is under the restrictions until 2021. The BBC team had heard Scott was running a property company in breach of his BRO.
Scott told an undercover reporter Sandnewco One Ltd were run by himself and Alexander Duncan – their registered director – who was a “silent partner”.
They also found Scott had formed a property company called Northside Residential Ltd, another breach of his BRO.
Richard Dennis, chief executive of Scotland’s Accountant in Bankruptcy, who give out BROs, admitted no one “proactively” monitored BROs.
Scott denied acting as a director of any company.