Advice firm director banned for ‘unacceptable’ record-keeping

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The director of two financial services companies including a Chelmsford advice firm has been disqualified for eight years due to poor record keeping.

James Lau was director of WFM Management Services, a financial advice firm, and GG Blue Sky, a derivatives trading business.

Both companies were placed into liquidation in September 2013, with an estimated £7.8m in Blue Sky assets and £26,000 in WFM assets owed to shareholders and creditors.

An Insolvency Service investigation found Lau failed to maintain the books and records of both companies or deliver them up to the liquidator.

According to the Insolvency Service, the records could not account for more than £4m of income and expenditure from Blue Sky and £500,000 of income and expenditure from WFM over a period of less than two years.

Much of those funds were allegedly related to client pensions and investments but the Insolvency Service says it is not possible to explain who the funds belonged to or where they went, which has left clients out of pocket.

The records also do not explain what happened to properties bought for more than £600,000 and £41,300 of payments to an internet gambling site.

Insolvent Investigations North group leader Rob Clarke says: “This failure to maintain, preserve or deliver up records is totally unacceptable, especially where creditors and shareholders are owed substantial amounts, and potential assets were not preserved or disclosed for realisation by the liquidator. The Insolvency Service has ensured that such behaviour will not be tolerated and that robust action will be taken against directors where misconduct is found.”