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A scheme that has helped the directors of more than 1,000 struggling companies to drop debts worth tens of millions of pounds is still running despite government attempts to shut it down.
The Insolvency Service closed seven companies that were part of a group that allegedly “deliberately undermined the insolvency regime” in September but The Times has established that the contentious scheme is still operational.
A group called Atherton marketed what it said was a “legal alternative to using insolvency practitioners” but a government investigation concluded that it “encouraged directors to dispose of all their assets”, potentially depriving creditors of millions of pounds.
The government said that Atherton encouraged directors struggling with company debts to “sell their businesses and avoid liquidation” via a scheme that attempts to allow people running struggling companies to distance themselves from company failure.
It claimed that Atherton had misled struggling directors “by telling them they could keep their company’s assets, continue to trade the business through a new company and avoid any responsibility for debts”.
According to an analysis by Tax Policy Associates, an independent think tank, for The Times, directors have passed on debts running into tens of millions of pounds at least to Atherton, including money owed to HMRC. Atherton installed new directors and waited for companies to be dissolved or fall into insolvency.
It is understood that the Insolvency Service is considering whether to pursue directors who have used the Atherton scheme.
One of the directors who takes over clients of Atherton is called Neville Taylor. For a man who has been a director of hundreds of businesses, Taylor has a surprisingly low profile.
At Companies House, his name can be found against everything from a developer of satellite technology to children’s nurseries to farmland, yet there are few other online traces of him. Creditors and insolvency practitioners who have tried to track him down in person have reported difficulties doing so.
Taylor’s identity and stewardship of businesses has sometimes baffled insolvency practitioners appointed at his companies. Some have questioned whether he exists at all. His involvement in a company often culminates in insolvency or dissolution.
Filings show that the scheme’s users include companies previously controlled by Piers Adam, the hospitality entrepreneur who owned the Mahiki and Whisky Mist nightclubs; Mat Feakins, a former Tory chairman of Monmouthshire county council; and Paul Wildes, a hotel, restaurant and spa entrepreneur who once owned Port Vale football club.
It works like this: a director pays a fee (typically thousands of pounds) to Atherton and then sells them their company for £1. Atherton installs Taylor or others as figurehead directors.
No attempt is made to trade or repair the business, recover money for creditors, sell assets or run the company in any conventional sense. If no creditor takes action — a common occurrence if it is decided that recovery might cost more than the outstanding sum — the company will eventually be dissolved. That would be a good outcome as far as users of the service and its operators are concerned, but less so for creditors, as no attempt would have been made to recover debts.
When an insolvency practitioner has been appointed to a company where Taylor is a director, frequently there are complaints that they haven’t been able to track Taylor down nor locate the company’s books and records. For example, the administrator of Lodent Precision, an engineering business of which Taylor was a director, complained that the company “appeared not to have anyone who knew the business in executive control”. At winding-up petitions, companies that have gone through the scheme have often been left unrepresented in court.
The scheme has apparently been promoted as a way for struggling companies to drop liabilities while allowing directors to retain assets that should have remained available to repay creditors.
Filings appear to show that some users immediately set up new “phoenix” companies to carry on in the same trade they were in before minus the debts they had built up, which were passed to Atherton. Some of the individual companies sold to Atherton had debts running to millions of pounds.
Marketing emails sent to business owners by the service, seen by The Times, tell directors that the scheme can “protect the cash in bank, any assets and also your debtor list” and “you can keep trading”.
National Company Rescue, an organisation that promotes the Atherton scheme, sold it as an alternative to a formal insolvency, which it said meant directors would “lose control of any money, stock and assets”. It said the Atherton service was “unlike” insolvency, in which assets of the company may be sold to repay creditors.
As well as arranging for “any assets to be retained by” clients, customers avoid the “reputational damage” of being recorded as the “director of a company in” insolvency, according to National Company Rescue marketing.
Mike Hartley, managing partner at Global Corporate Solutions, an insolvency and debt collection firm based in North Wales, has had one client facing losses from two separate companies whose directors used the Atherton service, both of which were taken over by Taylor. Both of the businesses appear to have been quickly replaced with “phoenix” companies.
Hartley alleges: “This is just a way for delinquent directors to dump millions of pounds worth of debt and start again without scrutiny. The Insolvency Service should consider whether any directors who have used this service have breached their fiduciary and statutory duties.”
Despite the Insolvency Service action, National Company Rescue is still marketing the scheme. The man behind Atherton, John Irvin, 57, confirmed that new companies had been set up to keep the service operational.
Irvin said: “This is a legitimate company sale service. We acknowledge that the Insolvency Service doesn’t like aspects. We have modified our approach and we are very clear that we do not give any advice to directors.”
He said that none of the directors paid by Atherton to be directors of the companies had been pursued for disqualification by the Insolvency Service. He added that the directors it installed cooperated with queries from insolvency practitioners and creditors.
Irvin said he was not aware that National Company Rescue, which he described as a separate entity that marketed the Atherton scheme, was marketing the service as allowing people to keep company assets, bank accounts and debtor books, and said this was not a feature of the service.
National Company Rescue is described on LinkedIn as a “trading name for Atherton Corporate Partners LLP”, of which Irvin was a director from its inception in 2017 until a day after an Insolvency Service statement on the scheme was published.
National Company Rescue’s former owner, Ross Thomson, was a director used by the Atherton service to take over client companies. Thomson and Barrie Jones, National Company Rescue’s current owner, could not be reached for comment.
Adam, who was best man at Guy Ritchie’s wedding to Madonna in 2000, controlled Craigellachie Hotel Trading between September 2016 and October 2018. In its final set of accounts it listed £3.5 million of creditors due within one year. Adam stepped down as a director in 2018 and was replaced by Thomson, the original owner of National Company Rescue. It was wound up by the court the following year and is now in liquidation. Adam did not respond to requests for comment about his apparent use of the Atherton scheme. The hotel itself is still trading.
A spokeswoman for Taylor said that he cooperated with insolvency practitioners, replied to queries from creditors, and wrote to creditors “within 12 months of appointment”. She said that Taylor was paid between £500 and £1,000 for each appointment, “considerably less” than the operators of the scheme .
She said that Taylor had been interviewed 49 times by Insolvency Service officials in relation to companies he ran and had “not had any proceedings launched against him”.
Taylor reminded directors of their duties, she said, including where redundancies followed his appointment. However, she alleged that there were cases where directors had paid Atherton in an attempt to “avoid their duties”, so did not always cooperate with Taylor.
Stephen Hunt, partner at Griffins, a specialist insolvency firm and an expert in insolvency rules, alleged that the scheme’s operators and users had put themselves at risk of breaching “multiple” insolvency laws. “Directors could face the consequences for years, while I fear the organisers of these schemes will melt away.”
Irvin said the scheme was legal.
The Insolvency Service is understood to be aware that the scheme is still operational and is considering whether to pursue directors who have used it. It declined to comment on Taylor.
Adam and Wildes did not respond to invitations to comment on the service.
Feakins could not be reached.
HMRC declined to comment.
The Times attempted to reach several directors who used the Atherton service. Most did not want to talk about it. One claimed that their use of the service was being investigated by HM Revenue & Customs.
Another said, on condition of anonymity: “I can’t explain to you how many problems this has caused me.” He said he was being pursued by the Insolvency Service. “I know other people who have been pitched the Atherton service and I’ve told them to go nowhere near it. It’s bad for creditors and risky for directors — the only winners are Atherton.”
Piers Adam, a serial hospitality entrepreneur who was best man at Guy Ritchie’s wedding to Madonna in 2000, controlled Craigellachie Hotel Trading between September 2016 and October 2018. In its final set of accounts it listed £3.5 million of debts due within one year.
Adam bought The Craigellachie Hotel in Scotland in 2014. Craigellachie Hotel Trading appears to have been the trading arm of the hotel. Adam stepped down as a director in 2018 and was replaced by Ross Thomson, original owner of National Company Rescue. In 2019 the company, by then known as Skyfall Ventures, was wound up by the court; it is in liquidation. Adam did not respond to requests for comment. The hotel itself is still trading.
Paul Wildes, a former owner of Port Vale FC, runs the Wildes Group, which has spas, restaurants and hotels.
He resigned as a director of Kings Gap Trading, which ran a Merseyside hotel of the same name, in January 2023 and was replaced by Neville Taylor. The company was about to be struck off but an objection was filed in June last year. Wildes said his group “sold this hotel two years ago” but did not respond to invitations to comment about the sale to Taylor or any dealings with Atherton or National Company Rescue.
Liquidators of Woden Park, a solar farm company previously owned by Mat Feakins, former mayor of Monmouth, commented last month on its transfer to Taylor’s control in 2023.
The company failed after £366,000 of legal costs were awarded against it, liquidators said. Five months before its liquidation Feakins sold its assets to Atherton and purportedly paid them £3,000. Atherton then appointed Taylor.
Liquidators said that Feakins “may now be residing in Kosovo” and that they had written to him and Taylor but had no response. They are considering issuing a claim against Feakins for £325,892. Feakins could not be reached. A spokeswoman for Taylor said documents requested by liquidators had been provided.