Payday loan company executives have diverted money from a retirement relief plan for borrowers to pay off business debts instead.
The Speed-e-Loans company has received £ 1.2million from brokers as a pension relief scheme investment.
The money was supposed to go to the company’s client in the form of loans, but instead directors Philip Miller, his son Daniel Miller, and Robert Davies spent the money to pay off the loan company’s own debts.
The company’s financial secrets were revealed in a BBC documentary in May 2013.
Speed-e-Loans went into administration the following month.
After an investigation by the government’s insolvency department, Phillip Miller and Davies agreed to serve a six-year ban on directorships. David Miller accepted a five-year ban.
The Insolvency Service found that they had breached their fiduciary duties and their duties of care, skill and diligence.
Disqualification means that no one can take a managerial position in a public limited company until the ban expires.
Cheryl Lambert, Chief Insolvency Investigator, said: The directors have been collectively, and by the kindest interpretation, recklessly neglectful in their desperation to save the business. None of them asked simple and obvious questions when it should have been clear to them that brokers were taking almost 50% in fees, nor what kind of scheme they got involved in and who which pushed the stratagem.
“Philip Miller, the author and the main character, could financially win individual transactions through a commission and his actions therefore demand the most severe criticism.”
The investigation found that the directors had allowed their company to receive funds from private investors through pension relief schemes after the company was not creditworthy and had stopped lending to new clients.
Speed-e-Loans negotiated as a payday loan provider from February 2010 until July 2012, when the then CEO was suspended. A new managing director was appointed, but the company stopped lending to new clients in August 2012,
Phillip Miller has proposed that the company receive money from a pension relief plan put in place by third-party brokers.
Speed-e-Loans was to be the investment through which investors received guaranteed annual dividend payments of 5% and a guaranteed return on their entire investment in 10 years.
However, instead of lending money to borrowers, administrators paid their own business bills.