A director caused more than a £¼m of stock to be transferred from a failing Huddersfield company to another business of which he was also a director.
The move, by Christopher Lister, of GMS Stone Supplies Ltd, meant creditors, including the HMRC, who were owed more than £170,000, lost out when the company was liquidated.
Mr Lister, 51, has now been disqualified from being a company director for three and a half years for causing a preference transaction to a connected company, following a Disqualification Order by Leeds County Court.
It prevents him from becoming involved in the promotion, formation or management of a company until July 2019.
The Insolvency Service said while Mr Lister was a director of GMS Stone Supplies Limited and less than a month before it was liquidated, an invoice for the sale of stock for £268,762 inclusive of VAT, was raised to a connected company, which was also a creditor of GMS.
GMS, which traded as a stone supplier from Lindley Moor Road, Huddersfield. transferred the stock but did not receive full payment for its value, to the detriment of its creditors.
The Insolvency Service said the ‘preference transaction’ had the effect of giving one creditor a ‘preference’ in the insolvency to the prejudice of the general body of creditors.
Robert Clarke, group leader with Insolvent Investigations North, of the Insolvency Service, said: “The Insolvency Service and the Department for Business will take firm action against those directors who act with a disregard for company creditors, causing them loss and who are unfit to manage a company, to protect the public and the business community.”
GMS went into Creditors Voluntary Liquidation in February 2013 with an estimated deficiency of £260,700.