Bed Company Director gets Rude Awakening

Small Business News

A director of a bed company whose dealings cost creditors almost £200,000 has been sentenced to a 12 week suspended prison sentence and 150 hours of community service at Bishop Auckland Magistrates Court. He was also handed a three year blanket ban from operating as a director.

This follows a prosecution by the Department for Business under the Insolvency Act 1986.

Paul Edward Raine, of Windermere Court, Darlington pleaded guilty to the charge of acting as a director of a company known by a prohibited name.

In February 2007 Mr Raine's company Furntex Ltd entered voluntary liquidation, owing over £500,000 to creditors. Raine however tried to hide this under the mattress; illegally resurrecting the company under the name of Dreamsleeper Ltd. Raine's "new" venture failed and was placed into liquidation in August 2008. Creditors lost an estimated £195,198.

In passing sentence, Magistrates expressed the view that this was a serious and deliberate breach of Section 216 of the Insolvency Act.