A group of financial services directors have been banned after causing the company to take money from clients and make self-serving payments while being insolvent
Paul Rossi was a director of Independent Derivative Traders Ltd, which traded as Futex and provided access to a financial markets trading platform for sub-contracted independent traders.
The company was jointly managed by Rossi’s brother Mark Rossi and Daniel Goldberg.
Independent Derivative Traders was incorporated in March 1995 but 11 years later in February 2016, the company was insolvent due to difficult trading conditions and increased running costs, which meant it could not meet all of its liabilities.
The directors received professional advice that all of Independent Derivative Traders’ creditors should be treated equally and the directors had an obligation to look after its creditors’ interests and not to worsen their position.
However, despite Independent Derivative Traders being insolvent, the company obtained deposits from two new traders totalling £75,000, which were then used in general trading, while also paying-out over £79,000 to Paul and another director, as well as to an associated company. This was contrary to the advice given and detrimental to their creditors.
The company went into liquidation in November 2016 and the secretary of state has since accepted disqualifications undertakings from Mark Rossi (eight years), Paul Rossi (six years) and Goldberg (three and a half years) for their various roles in causing or allowing the company to take money from clients and make personal payments while being insolvent.
Goldberg’s ban started on 11 September 2018, while the Rossis’ disqualifications were effective in February 2019 and their disqualifications mean the directors are banned from directly or indirectly becoming involved, without the permission of the court, in the promotion, formation or management of a company.
David Brooks, chief investigator at the Insolvency Service, said: ‘When the company became insolvent, the directors were specifically instructed not to do anything that was detrimental to creditors. However, they decided to completely disregard that advice, putting their creditors at risk.
‘These disqualifications should serve to further underline that such behaviour is unacceptable and we will seek disqualifications against those directors that do not uphold their duties.’