Allegations made by Secretary of State for Business Innovation and Skills

Taken from Skeleton Argument – THE SECRETARY OF STATE FOR BUSINESS INNOVATION AND SKILLS

Unfairpak would like to point out that these are allegations only and all persons named are innocent unless proven otherwise!!!!

5. The allegations of unfit conduct are, in very broad form, as follows:

5.1. Causing or permitting EHR to trade at the unreasonable risk of its creditors for the period from November 2005 (all defendants other than Mr Fowler) to the collapse in October 2006 and for the period from January 2005 to the collapse in October 2006 (Mr Fowler, who only became a director of FFG and EHR in January 2006) and, in the same periods, failing to ensure that that the FFG board was functioning adequately;

5.2. Causing or permitting FFG to trade at the unreasonable risk of its creditors for the period from November 2005 (Mr Rollason and Mr Gilodi-Johnson) to the collapse in October 2006 and for the period from January 2005 to the collapse in October 2006 (Mr Fowler, who only became a director of FFG and EHR in January 2006);

5.3. From 14 November 2005 (Mr Rollason and Mr Gilodi-Johnson) and from 1 January 2006 (Mr Fowler) seeking to mislead, alternatively failing to take adequate steps to inform, the boards of each of FFG and EHR of the developing financial situation in relation to a forecast inability of EHR to put FFG in funds to pay its major supplier at the end of January 2006;

5.4. In February 2006, failing to give any or any adequate consideration to (a) matters set out in a letter of representation provided to the auditors of FFG; (b) whether the financial statements for FFG for the period ending 28 April 2005 gave a true and fair view including by reference to any material post balance sheet events and (c) whether FFG’s auditors should have been informed of an inability of FFG to pay £5.6m due to its major supplier at the end of January 2006 and/or the collapse of such major supplier thereafter (Mr Rollason and Mr Fowler) and, in the case of Mr Rollason, permitting financial statements for FFG for the April 2005 year end to state that they had been approved by the board of FFG when the board had not met and had not approved the same;

5.5. From February 2006, failing to take adequate steps to inform the boards of EHR and FFG of the developing financial situation (Mr Rollason, Mr Fowler and Mr Gilodi-Johnson);

5.6. Seeking to mislead investigators appointed under s447 of the Companies Act 1985 as to the reasons for the failure of FFG, and its financial inability, to pay its major supplier at the end of January 2006 (Mr Rollason and Mr Fowler).