The Department for Business, Energy & Industrial Strategy (‘DBEIS’) brought a criminal prosecution against their client who had run an initially successful company, which then went into liquidation, owing creditors in the region of £2.9m.

The DBEIS is the Government department responsible for economic growth, incorporating business, industrial strategy, science, innovation, energy, and climate change.  Since January 2017, criminal prosecutions have been conducted by the Insolvency Service, an executive agency of DBEIS.

The prosecution in this case, brought proceedings under the Insolvency Act 1986 alleging 1) the falsification of company books and 2) misconduct during the course of the winding-up of the company.

The Insolvency Service criminal enforcement team identifies and prosecutes fraud in companies by prosecuting breaches of Insolvency and Company Law.

Once DBEIS accept a complaint about alleged criminality by a bankrupt or relating to the affairs of a limited company, Investigating Officers will conduct a criminal investigation – gathering evidence and taking witness statements – or may refer the case to other regulatory agencies for enforcement.

Individuals under investigation will usually be invited to an interview under caution. They are entitled to legal representation.

A DBEIS lawyer then applies the Code for Crown Prosecutors and assess whether there is enough evidence against the individual to provide a realistic prospect of conviction, and, if so, whether it is in the public interest for the prosecution to be brought.

If DBEIS is successful, save for exceptional circumstances, a confiscation order (under the Proceeds of Crime Act 2002) and a director’s disqualification order (under the Company Directors Disqualification Act 1986) will usually follow a conviction.

Public scrutiny of government agencies’ apparent ‘light-touch’ regulation of white-collar offending means there is an increasing pressure on government agencies to bring criminal prosecutions. According to DBEIS’s figures, 97 individuals were successfully prosecuted between April 2016 and March 2017, with 63 of those receiving custodial sentences.