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High Court orders further sham online recruitment companies into liquidation

18 January 2012 12:45

Insolvency Service

Two Leamington Spa based companies, Online Staffing Limited and Recruitment Web Solutions Limited, have been ordered into liquidation in the High Court on grounds of public interest following an investigation by Company Investigations of the Insolvency Service.

Both companies described their business as recruitment specialists in advertising the latest job opportunities in nursing, healthcare and education, using the links below:

The investigation found there was no legitimate business carried on by either company.

At court Ms Registrar Barber, who made the liquidation order, said:

“The information obtained by the investigator suggests that the companies have been used as vehicles for fraud by passing themselves off as reputable recruitment advertising organisations in a bid to procure contracts with the advertiser and subsequently seek payment for their purported services.

Welcoming the Court’s judgment (see Note 6 below), Company Investigations Supervisor Chris Mayhew said:

“The action we have taken against these and similar companies sends a clear and simple message that The Insolvency Service is determined to clamp down on unscrupulous companies and ensure that those who run companies in this way do not get away with it”.

Ends

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Notes to Editors

1. Online Staffing Limited was incorporated as a private company on 19 April 2011. The registered office of the company was at 3 Crabtree Grove, Leamington Spa, CV31 1QS. The sole recorded director of the company was Mrs Sharon Downes. The company had no recorded secretary.

2. Recruitment Web Solutions Limited was also incorporated on 19 April 2011. The registered office of the company was also at 3 Crabtree Grove, Leamington Spa, CV3 1QS. The sole recorded director of the company was also Mrs Sharon Downes. The company had no recorded secretary.

3. The petitions to wind up both companies were presented in the High Court on 22 November 2011 under the provisions of section 124A of the Insolvency Act 1986. On the application of the Secretary of State the Official Receiver was appointed as provisional liquidator of the companies on 24 November 2011 – see news release “Two Leamington Spa online staff recruitment companies now offline” (http://nds.coi.gov.uk/clientmicrosite/Content/Detail.aspx?ClientId=95&NewsAreaId=2&ReleaseID=422252&SubjectId=36) issued on 25 November 2011.

4. The petitions were presented following confidential enquiries carried out by Company Investigations under section 447 of the Companies Act 1985, as amended.

5. The grounds in the petitions found by the Court for winding up the companies were false and misleading statements and objectionable trading practices; failure to co-operate; and failure to maintain and/or deliver up adequate accounting records.

6. In ordering the companies into liquidation on 11 January 2012, Ms Registrar Barber said:

“These are the petitions of the Secretary of State for Business, Innovation and Skills seeking the winding up of Online Staffing Limited and Recruitment Web Solutions Limited in the public interest. The companies were placed into provisional liquidation on 24 November 2011 by order of Mr Justice Norris. No evidence has been filed in response to these petitions or any indication that the companies contest the matter. In summary, the information obtained by the investigator Mr Grant suggests that the companies have been used as vehicles for fraud by passing themselves off as reputable recruitment advertising organisations in a bid to procure contracts with the advertiser and subsequently seek payment for their purported services. There have been a number of companies that have been found to have operated the fraud throughout the course of 2010 and 2011.

The companies have targeted public sector organsisations including schools and medical centres. These organisations had placed a job advertisement on the websites of reputable advertising publishers such as the RCN, the Times Educational Supplement or Times Higher Education Supplement. Around the time that the reputable advertisement was scheduled to appear the companies would send a fax with what was intended to appear as a proof copy of the advert on which was requested a signature on a ‘booking form’. In certain instances the fax was preceded by a telephone call to the target organisation in which the companies would pass themselves off as the reputable publisher. The companies objective was to mislead the organisation into entering into a contract with the companies for their advertising ‘services’ by unwittingly signing the booking form on the misunderstanding that it was a document sent by the reputable publisher. Upon an organisation signing the booking form, the companies would paste a word for word copy of the genuine advert onto their own websites. The companies would then chase for payment for providing their ‘services’

I am satisfied on the basis of the uncontested evidence before me, and having regard to all of the circumstances outlined, that the companies should be wound up in the public interest and I do so order”.

7. For winding up action against other such companies on grounds of public interest see news release “High Court orders sham internet recruitment company into liquidation” (http://nds.coi.gov.uk/clientmicrosite/Content/Detail.aspx?ClientId=95&NewsAreaId=2&ReleaseID=421706&SubjectId=36) issued on 21 October 2011.

8. Company Investigations, part of the Insolvency Service, carries out confidential enquiries on behalf of the Secretary of State for Business, Innovation & Skills (BIS).

9. 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

10. All public enquiries concerning the affairs of the company should be made to: The Official Receiver, Public Interest Unit , 2nd Floor, 3 Piccadilly Place, London Road, Manchester, M1 3BN Telephone: 0161 234 8531 Email: piu.north@insolvency.gsi.gov.uk

11. Media Enquiries should be directed to:

Kathryn Montague, Media Relations Manager, Telephone 020 7674 6010 or
Ade Daramy, Press Officer on 020 7596 6187

Ins12/Coms/002

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