Five companies shut down for fraud

In a significant crackdown on corporate fraud, the Insolvency Service has shut down five companies that filed false accounts indicating substantial financial success. Automarket Europe Limited, Integra Group Limited, Maxell Limited, Montana & Montana Limited, and Supermarket Plus Ltd, all linked through shared office addresses in South London and Croydon, falsely claimed to have turnovers exceeding £642 million while lacking any genuine business operations. These companies not only misrepresented their financial standings but also falsely cited reputable accountants as auditors, further complicating the integrity of their submissions.

Investigations by the Insolvency Service were initiated following referrals from Companies House, part of the ongoing enforcement of the Economic Crime and Corporate Transparency Act 2023 aimed at enhancing corporate accountability. The Act has granted Companies House the authority to eliminate any false or misleading information present in company registers, thereby bolstering the collaboration between agencies to deter the misuse of UK corporate structures.

The five offending companies found themselves in the High Court in Manchester, where they were wound up on 31 July. Dave Magrath, Director of Investigation and Enforcement Services at the Insolvency Service, articulated concerns surrounding the potential exploitation of their inaccurate accounts, remarking that "there was a genuine risk that these wildly inaccurate accounts could have been used to mislead potential customers and suppliers." He emphasised the necessity of preserving the integrity of the Companies House register, noting that "UK businesses rely on this information to make informed decisions about who they trade with, lend to, and invest in."

Each of the companies submitted accounts containing glaring discrepancies, including implausible jumps in reported assets without any explanatory context. For instance, Automarket Europe Limited declared a staggering turnover of £327 million alongside profits of £198 million for the year 2022, while claiming that its assets surged from £629,220 in 2021 to £84 million the following year. Integra Group Limited and Maxell Limited presented similarly outrageous claims, with the latter reporting a purported turnover of £440 million and £229 million in profits, along with assets purportedly expanding from £618,496 to £422 million in a single year.

Montana & Montana Limited made headlines for claiming to have engaged PricewaterhouseCoopers (PWC) as auditors for multiple years, despite PWC confirming they had never worked for the company and requesting the removal of such accounts. Supermarket Plus Ltd topped the figures, reporting £642 million in turnover and £330 million profit for 2022, with asset values supposedly increasing from £402,431 to £410 million, yet lacking tangible proof of actual trading activity.

The investigation revealed that all five companies failed to cooperate with the Insolvency Service's inquiries and did not submit accurate accounting records. The accounts of Automarket Europe Limited, Maxell Limited, and Supermarket Plus Ltd were subsequently removed from Companies House after being deemed "factually inaccurate and forged." Adrian Landeg, Head of Integrity, Compliance & Enforcement at Companies House, expressed satisfaction at the capacity to enact decisive measures against corporate misinformation through the new powers provided by the Economic Crime and Corporate Transparency Act, reinforcing that they "support economic growth."

The Official Receiver has been appointed as the liquidator for all involved companies, marking a pivotal step in ensuring the integrity of the corporate sector in the UK.

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