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Cornwall bankrupt jailed for defrauding creditors

02 March 2012 12:40

Insolvency Service

Edward Stephen Clive Ellery, a bankrupt from Wadebridge, Cornwall was handed a suspended 12 month prison sentence for making a fraudulent transfer by Truro Crown Court, following an initial investigation by The Insolvency Service and a full criminal investigation and Prosecution by the Department for Business, Innovation and Skills (BIS).

Mr Ellery pleaded guilty to one count of fraudulently transferring property, following a plea and case management hearing. His sentence was suspended for 12 months and he was ordered to do 160 hours of community work.

The court heard that in July 2008, in the face of numerous court orders and ongoing litigation, Mr Ellery sold a property for over £135,000 and transferred the majority of this sum to his wife instead of paying his creditors.

The money was then withdrawn from his wife’s account in separate transactions in August 2008 preventing his creditors from getting any of it. Had he not made the fraudulent transfer, he could have paid all of his legitimate creditors and retained a surplus.

Less than four months later, Mr Ellery was made bankrupt owing an estimated £109,000.

Commenting on the case, Deputy Chief Investigating Officer Liam Mannall from the Department for Business, Innovation and Skills said:

“Mr Ellery had debts, which is not uncommon, but he also had sufficient monies to settle his debts. He made a decision to deliberately divert funds which should have been available to his creditors in an attempt to put the money out of reach.

He now has a criminal conviction as a result of his actions. The Department for Business, Innovation and Skills will conduct criminal investigations and prosecute individuals who resort to such dishonest conduct. This case should act as a deterrent to others who think they might get away with it.”

Ends

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Notes to Editors

1. Mr Edward Stephen Clive Ellery – of Wadebridge, Cornwall was made bankrupt on a creditor’s petition on 29 November 2009.

2. Mr Ellery was convicted of making a fraudulent transfer contrary to section 357(1) of the Insolvency Act 1986. This provision makes it an offence to transfer property, within the five years prior to a bankruptcy order, with the intention to defraud or conceal the state of your affairs.

3. On 1 July 2008, Mr Ellery transferred £133,500 from his account to his wife’s account. This money was then passed to the couple’s joint account before being transferred back to Mrs Ellery’s account. It was then withdrawn on two separate occasions on 14 and 28 August 2008 meaning the funds could no longer be traced.

4. Offences:

Edward Stephen Clive Ellery, on 1 July 2008, in the period of five years ending with the bankruptcy order made against him on 26 November 2009, made or caused to be made a gift or transfer of his property, namely the sum of £133,500 contrary to Section 357(1) and 350(6) of the Insolvency Act 1986

5. The Insolvency Service administers the insolvency regime investigating all compulsory liquidations and individual insolvencies (bankruptcies) through the Official Receiver to establish why they became insolvent. The Service also authorises and regulates the insolvency profession, deals with disqualification of directors in corporate failures, 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 is available from www.bis.gov.uk/insolvency

6. BIS’ mission is to build a dynamic and competitive UK economy, 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. We investigate and prosecute a range of offences, primarily relating to personal or company insolvencies. Further information about the work of the Criminal Investigations and Prosecutions team is available at http://www.bis.gov.uk/policies/business-law/criminal-investigations

7. Media Enquiries should be directed to:

Kathryn Montague, Media Relations Manager, Telephone 020 7674 6910 or

Ade Daramy, Press Officer on 020 7596 6187

Ins/Coms/013

Contact Information

Ade Daramy
Name
Ade Daramy
Job Title
Mr
Division
Insolvency Service
Phone
020 7596 6187
Fax
Mobile
Email
ade.daramy@insolvency.gsi.gov.uk