Payday loan company directors diverted cash from a pension liberation scheme destined for borrowers to pay off their business debts instead.
The firm, Speed-e-Loans received £1.2 million from brokers as an investment from the pension liberation scheme.
The money was supposed to go to the firm’s customer as loans, but instead directors Philip Miller, his son Daniel Miller, and Robert Davies spent the money on repaying the loan company’s own debts.
The firm’s financial secrets were revealed in a BBC documentary in May 2013.
Speed-e-Loans went into administration the following month.
Directors banned
After an investigation by the government’s Insolvency Service, the Phillip Miller and Davies agreed to serve a ban on holding a directorship for six years. David Miller agreed a five-year ban.
The Insolvency service found that they had breached their fiduciary duties and the duties of care, skill and diligence.
The disqualification means none can hold a management role in a limited company until the ban has expired.
Cheryl Lambert, Chief Investigator at the Insolvency Service, said: The directors were collectively, and at the kindest interpretation, recklessly negligent in their desperation to save the company. None of them asked simple, obvious questions when it should have been clear to them the brokers were taking nearly 50% in fees, nor the type of scheme they had become involved with and the individuals who were pushing the scheme.
“Philip Miller, the proposer and principal character, stood to gain financially from individual the transactions through a commission and so his actions demand the harshest criticism.”
Guaranteed returns
The investigation found that the directors had allowed their company to receive funds from private investors via pension liberation schemes when the business was not solvent and had ceased lending to new clients.
Speed-e-Loans traded as a pay-day loan provider from February 2010 until July 2012, when the then managing director was suspended. A new managing director was appointed, but the company ceased lending to new clients by August 2012,
Phillip Miller proposed the company should receive money from a pension liberation scheme set up by third party brokers.
Speed-e-Loans was to be the investment through which investors derived guaranteed annual dividend payments of 5% and a guaranteed return of the whole of their investment in 10 years.
However, instead of lending the money to borrowers, the directors paid their own business bills.
