Two debt management company bosses have been banned after transferring £500,000 out of their firms – a sum investigators suspect included client funds meant to repay creditors.
The two were disqualified for a combined total of 23 years after a Financial Conduct Authority (FCA) investigation found serious malpractice in how the companies were run.
The FCA said that Andrew Brooke, 45, and Gary Gregson, 38, who have been disqualified for 13 and 10 years respectively, were “more interested in lining their own pockets” than helping vulnerable people get out of debt.
Both are now banned from acting, directly or indirectly, as directors of companies.
Gregson was the main director of Gregson and Brooke Financial Services Ltd (GBFS) and One Tick Ltd (OT). The companies provided debt management services, operating through various different trading names, including Expert Money Solutions.
Together GBFS and OT received payments from customers into debt payment plans and offered a ‘credit resolve’ product, which challenged the enforceability of credit agreements signed by their clients, as well as reclaiming PPI payments.
Although this was a legitimate service, GBFS and OT would pay minimal contributions to the credit providers from their clients’ debt payment plans, while keeping a significant portion of their clients’ money to go towards ‘service fees’.
Some customers complained to the Financial Ombudsman that their debts had increased, despite having paid money into their debt payment plans.
The FCA visited the offices of GBFS and OT in July 2014 and as a result the firm agreed to stop accepting new customers. The regulator also warned Gregson that the companies could be closed down after they were unable to provide adequate records of how much money was being held on behalf of their clients.
Gregson agreed not to withdraw fees, other than to pay staff, but then transferred £210,006 from GBFS and OT to himself and third parties he was connected to, before resigning his directorships.
The firms then came under the stewardship of Brooke, who was reappointed as a director of the companies on August 20 2014. Still concerned, the FCA issued supervisory notices to GBFS and OT on 29 August 2014.
But Brooke then transferred £442,000 to another company he was a director of before both GBFS and OT entered into administration in October 2014.
Following both companies’ demise, the Insolvency Service investigated the directors’ conduct after being warned by the firms’ administrators.
Gregson was disqualified by the court for 10 years, beginning on March 7 2018, for a lack of commercial probity and failing to ensure the debt management companies, including another failed company, Gregson and Brooke Ltd (GAB), adhered to guidance.
Brooke was disqualified at an earlier hearing for 13 years, beginning on July 7 2017, for the same charges.
At the same time that Brooke was disqualified, his wife Shalles Fee Onido, 43, also known as Shalles Brooke, and Nova Espoltero, 33, were disqualified for four years each having allowed Brooke to authorise £442,000 worth of transfers from GBFS and OT.
"Brooke and Gregson clearly put their own interests ahead of their clients"
Robert Clarke, head of insolvent investigations north for the Insolvency Service, said: “The real victims here are Brooke and Gregson’s clients who sought genuine assistance to help manage their debts but many received little or no benefit at all from instructing the companies to act on their behalf.
“Brooke and Gregson clearly put their own interests ahead of their clients. The vast amount of money they transferred out of their companies and their timing as the net was closing in from the FCA showed a cynical disregard for the needs of their customers.”
Jonathan Davidson, director of supervision – retail and authorisations at the FCA, said: “These individuals were more interested in lining their own pockets than helping potentially vulnerable people get out of debt. This case shows what can be achieved when we work with partners, like the Insolvency Service, to ensure people face the consequences of their actions.
“We are pleased that as result of our partnership it will be years before they have any involvement in the business community again as directors.”