A network of phantom companies set up specifically to steal from construction product suppliers has been liquidated by the High Court this month (March). 

The winding-up orders on six companies follow petitions presented by the Secretary of State for Business, Innovation & Skills, issued following confidential enquiries by Company Investigations, part of the Insolvency Service.

The Court heard that all bar one of the companies were incorporated by Jade Evans (who has not been located) and her company, ABN Company Formations Ltd (now dissolved). The Court heard that more than 50 other companies had been formed by Jade Evans and used as part of an extensive network of companies engaged in systematic fraud.

The investigation showed how the six companies before the Court had common features such as inexplicable and dramatic increases in their share capital, the appointment of fictitious officers, identity theft, the filing of false accounts reporting significant assets and trading, providing one another with favourable trade references, ordering goods whatever the price quoted by the supplier, creating websites with content usually taken from other genuine sites, all to give the impression of a bona fide business. The companies nevertheless had no presence at their registered offices.

The companies targeted building trade suppliers, depriving them of more than £300,000 of goods comprising cable and other electrical goods, steel and reinforcing rods, ceramic tiles, paint, flooring, artificial grass and computer and office supplies.

The goods fraudulently obtained were delivered to common addresses, one in Milton Keynes and two in Essex.

Welcoming the Court’s winding up decisions, Chris Mayhew, Company Investigations Supervisor at the Insolvency Service, said: "The accounts and information presented by these companies reporting them as substantial and credit-worthy businesses trading profitably for a number of years was as false as the artificial grass supplied to one of them.

"Each company was part of an organised operation and the goods delivered to them without payment were swiftly collected and put beyond reach for the benefit of those behind the companies and those who ultimately utilised the goods stolen.

"Typically this type of fraud can inflict losses on legitimate business of hundreds of thousands of pounds and in this instance nearly caused a small supplier to go out of business himself because of the loss inflicted.

"We work closely with a number of partners, such as Companies House, to prevent the abuse of the corporate regime by such lack of transparency and the Insolvency Service will investigate and bring to a halt companies harming or about to harm legitimate business by operating in this way."

The companies liquidated:

Battle Business Services Ltd (company registration number 08529432) was incorporated on 15 May 2013. The registered office of the company is Unit 9B Office 6, Ellough Industrial Estate, Ellough, Beccles, Suffolk, NR34 7TD. The present sole recorded director is a Sonny Wilson (described as a company director). No accounts have been filed and are overdue since 15 February 2015.

The company was used as a trade referee for ostensibly unrelated companies seeking credit.

Hydro Serv Ltd (company registration number 08408299) was incorporated on 18 February 2013. The registered office of the company is 20-22 Wenlock Road, London, N1 7GU (changed on 9 December 2014 from Unit 9B Office 6, Ellough Industrial Estate, Ellough, Beccles, Suffolk, NR34 7TD). The present sole recorded director is a Lucy Mary Masters (described as a company director).

The company’s share capital on incorporation was £1. It was subsequently increased to £80,001 comprising 80,001 ordinary £1 shares all shown to be held by a Wayne Hulmes.

The company’s filed accounts purport to show total assets as at 28 February 2015 of £1,800,914 (including cash of £187,113) and accumulated profits since incorporation of £1,137,802.

The company sought credit from suppliers and obtained goods of at least £11,108 comprising cabling and other electrical supplies.

Neither company had permission to use the Ellough Industrial Estate as their address.

A further company, Creative Communications (UK) Ltd (company registration number 04834649), also shown to be based at Ellough Industrial Estate (without permission and whose sole recorded director from 04 June 2013 was once more shown to be a Sonny Wilson), was ordered into liquidation on 29 June 2015 on the petition of HMRC in respect of returned and assessed VAT and interest totalling £115,403.

According to the accounts of Creative Communications (UK) Ltd, filed after the appointment of the person calling himself Sonny Wilson, the company’s total assets as at 31 July 2013 were reportedly £834,282 (previous year £nil) including cash of £146,753 with a profit for the year of £219,853.

A further company, Midas People Ltd (company registration number 08380698), also shown to be based at Ellough Industrial Estate without permission, was ordered into liquidation on 11 May 2015 on the petition of an invoice financing company.

According to the accounts of Midas People Ltd, filed at a time when the company had no recorded officers, the company’s total assets as at 31 January 2014 were reportedly £1,387,854 (including cash of £155,330) with a profit for the year of £1,008,498.

Midas People Ltd sought credit from suppliers and obtained goods of at least £132,717 comprising cabling and other electrical supplies, flooring, ceramic tiles, steel and wire rods.

Winnington Marketing Ltd (company registration number 08369009) was incorporated on 21 January 2013. The registered office of the company is 1 Royal Exchange, Royal Exchange Avenue, London, EC3V 3LT. The present sole recorded director is a Patricia Williams (described as retired).

The company’s share capital on incorporation was £1. It was subsequently increased to £250,000 comprising 250,000 ordinary £1 shares all shown to be held by an Amie Mock.

The company’s filed accounts purport to show total assets as at 31 January 2014 of £2,942,962 (including cash £231,000) and a profit for the year of £2,942,962.

The company operated a website: www.winnington-marketing.com

The company sought credit from suppliers and obtained goods of at least £42,405 comprising cabling and other electrical supplies, paint and timber.

Unique Wholesale Ltd (company registration number 08378144) was incorporated on 28 January 2013. The registered office of the company is 145-157 St Johns Street, London, WC1V 4PW. The present sole recorded director is a Graham Flemming (described as a company director).

The company’s share capital on incorporation was £2. It was subsequently increased to £49,000 comprising 49,000 ordinary £1 shares all shown to be held by the person calling himself Mr Flemming.

The company’s filed accounts purport to show total assets as at 31 January 2014 of £1,459,136 (including cash of £279,123) and a reported turnover of £3,658,301 and profit of £745,832.

The company sought credit from suppliers and obtained goods of at least £40,562 for the supply of artificial grass and ceramic tiles.

Zen IT Ltd (company registration number 08409473) was incorporated on 19 February 2013. The registered office of the company is Unit 9B Office 6, Ellough Industrial Estate, Ellough, Beccles, Suffolk, NR34 7TD. Again, the company did not have permission to use this address.

The company’s share capital on incorporation was £1. It was subsequently increased to £75,000 divided into 75,000 ordinary shares of £1 each all shown to be held by a Lester Phillip.

The present sole recorded directors are a Tommy McAvoy (described as a company director) and a Lester Philip (described as a sales director).

The company’s filed accounts purport to show total assets as at 31 August 2014 of £1,380,374 (up from £221,200 as at 28 February 2014), including cash of £289,657 and accumulated profits since incorporation of £893,819.

The company operated a website: www.zen-it-ltd.com

The company sought credit from suppliers and obtained goods of at least £27,141 for the supply of computer equipment and office supplies.

3D Media Ltd (company registration number 08378872) was incorporated on 29 January 2013. The registered office of the company is 20-22 Wenlock Road, London, N1 7GU (changed on 28 October 2015 from Unit 21, Nobel Square, Burnt Mills, Basildon, Essex, SS13 1DY). The present sole recorded director is a Nigel Weekes (described as a company director).

The company’s share capital on incorporation was £1. It was subsequently increased to £10,000 comprising 10,000 ordinary shares of £1 each all shown to be held by a Hardev Singh Degan.

The company’s filed accounts purport to show total assets as at 30 June 2015 of £3,415,689 (including cash £360,100) and a reported turnover since incorporation of £8,492,978 with accumulated profits of £2,507,926.

The company operated a website: www.3d-media-uk.com

The company sought credit from suppliers and obtained goods of at least £49,089 for the supply of cable and other electrical supplies.

The petitions to wind up the 6 companies in the public interest were each presented on 5 November 2015. The petition issued against Unique Wholesale Ltd was supported by a supplier of artificial grass owed £31,034.

The public interest ground for winding up the 6 companies was primarily that they were being used as vehicles for the commission of fraud.