Press release: Lengthy bans for carbon credit company directors
World Future sold voluntary emission reduction carbon credits (VERs) at highly inflated prices to members of the public as an investment. The credits had no investment potential.
In January Edward George Lee became the last of the four to agree to a disqualification with the Secretary of State for Business, Energy and Industrial Strategy. Mr Lee, 71, of Woodford Green, Essex accepted a four year, six month disqualification which commenced on 6 February 2017.
In 2015 and 2016 his fellow directors, James Laurence Ward, 31, of London E18; Hollie Emily Chapman, 31, of Loughton, Essex and Julie Margaret Sellers, 55, of Croydon, had earlier accepted disqualifications of between 12 and 14 years.
The disqualifications follow an investigation by the Official Receiver, whose involvement commenced with the winding up of the company in the public interest. The winding up order was initiated following a Company Investigations probe into the affairs of the company.
The Official Receiver’s investigation uncovered that between June 2011 and March 2012 World Future sold VERs to members of the public as an investment and netted at least £2,484,500.
VERs are fundamentally different from the licences to pollute (such as CERs) that can be readily traded in the compliance carbon market established under the Kyoto protocol. VERs are intended to be retired by businesses or individuals to offset their carbon footprints. Unlike with CERs, there is no readily accessible market where customers can sell on their VERs in the hope of being able to make a profit.
Ward acted as a director of World Future throughout its trading life without being formally appointed and caused it to trade with a lack of commercial probity by selling VERs as investments that had no potential to show a return to investors. He was only formally appointed as a director after the trading had ceased.
Chapman, Sellers and Lee were appointed at various times to be directors, but took no part in the day to day trading of World Future. Their inaction facilitated Ward and another individual to control World Future and cause it to trade with a lack of commercial probity while concealing their involvement. The other individual is already subject to a 14 year disqualification for action as a director in another company.
Commenting on this case Anthony Hannon, Official Receiver in the Public Interest Unit, said:
This company held itself out as having extensive expertise in the carbon credit market and made bold claims about the potential returns available when investing in carbon credits.
The directors and salespeople had no such trading experience and were only able to make sales on the basis of systematic misrepresentations about the VERs they sold. The truth is that the VERs were impossible to resell, making them worthless as investments. The company was run entirely for the benefit of those running it, at substantial cost to the investors who had been misled.
The lengthy periods of disqualification in this case show that this kind of behaviour will not be tolerated by the Insolvency Service.
Notes to Editors
World Future Ltd (CRN: 07662439) was incorporated on 8 June 2011. The trading address shown on its literature was Level 37, 1 Canada Square, Canary wharf, London E14 5AA, but this was an accommodation address where the company had no physical presence. The company’s actual trading address was at Docklands Business Centre, 10 – 16 Tiller Road, London E14 8PX.
The petition to wind up the company was presented in the public interest by the Secretary of State for Business, Innovation and Skills following an investigation conducted by Company Investigations (Live), another specialist unit within the Insolvency Service which uses powers under the Companies Act 1985 (as amended) to conduct confidential enquiries into the activities of live limited companies in the UK on behalf of the Secretary of State.
The winding up order against World Future Ltd was made on 6 March 2013.
The company had previously entered creditors voluntary liquidation on 7 June 2012.
On 14 May 2015 the Secretary of State accepted a disqualification undertaking from James Laurence Ward for a period of 14 years. The period of disqualification commenced on 4 June 2015.
On 13 November 2015 the Secretary of State accepted a disqualification undertaking from Julie Margaret Sellers for a period of 12 years. The period of disqualification commenced on 4 December 2015.
On 8 March 2016 the Secretary of State accepted a disqualification undertaking from Hollie Emily Chapman for a period of 12 years. The period of disqualification commenced on 29 March 2016.
On 16 January 2017 the Secretary of State accepted a disqualification undertaking from Edward George Lee for a period of 4 years and 6 months. The period of disqualification will commence on 6 February 2017.
A disqualification order has the effect that without specific permission of a court, a person with a disqualification cannot:
- act as a director of a company
- take part, directly or indirectly, in the promotion, formation or management of a company or limited liability partnership
- be a receiver of a company’s property
Disqualification undertakings are the administrative equivalent of a disqualification order but do not involve court proceedings. Persons subject to a disqualification order are bound by a range of other restrictions.
The Insolvency Service, an executive agency sponsored by the Department for Business, Energy and Industrial Strategy (BEIS), administers the insolvency regime, and aims to deliver and promote a range of investigation and enforcement activities both civil and criminal in nature, to support fair and open markets. We do this by effectively enforcing the statutory company and insolvency regimes, maintaining public confidence in those regimes and reducing the harm caused to victims of fraudulent activity and to the business community, including dealing with the disqualification of directors in corporate failures.
BEIS’ mission is to build a dynamic and competitive UK economy that works for all, in particular by creating the conditions for business success and promoting an open global economy. The Criminal Investigations and Prosecutions team contributes to this aim by taking action to deter fraud and to regulate the market. They investigate and prosecute a range of offences, primarily relating to personal or company insolvencies.
The agency also authorises and regulates the insolvency profession, assesses and pays statutory entitlement to redundancy payments when an employer cannot or will not pay employees, provides banking and investment services for bankruptcy and liquidation estate funds and advises ministers and other government departments on insolvency law and practice. Further information about the work of the Insolvency Service, and how to complain about financial misconduct, is available.
All public enquiries concerning the affairs of the company should be made to: The Official Receiver, Public Interest Unit (South), The Insolvency Service, 2nd Floor, 4 Abbey Orchard Street, London SW1P 2HT. Tel: 020 7637 6578 Email: piu.or@insolvency.gsi.gov.uk.
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