PRESS RELEASE : 10-year ban for Thomas Whyte, boss of Fortress Restructuring Ltd after wrongly claiming £50,000 loan [February 2023]

The press release issued by HM Treasury on 13 February 2023.

Thomas Whyte claimed £50,000 Bounce Back Loan for dormant Scottish restructuring business, and withdrew cash before firm was wound up.

Thomas Whyte, 76, from Carluke, was the sole director and shareholder of Fortress Restructuring Ltd until it was wound up following an Insolvency Service investigation in February 2021.

In May 2020, Whyte applied for a £50,000 Bounce Back Loan for the company, stating on the application that its turnover was £250,000.

In October 2020 representatives of Fortress Restructuring Ltd advised the Insolvency Service that it had no trading address, had never traded and was not currently trading.

Following the liquidation, investigators discovered that up to the end of April 2019, accounts filed with Companies House showed that Fortress Restructuring Ltd was dormant, and the company’s only asset was £100 share capital.

On the day Whyte applied for the loan, the company in fact had just £203 in its bank account, and less than £1,000 had been received into it over the preceding year.

The Secretary of State for Business petitioned for the company to be wound up in the public interest, and the petition was presented at the Court of Session and issued publicly in the Gazette on 1 February 2021, with a copy emailed to Whyte four days later.

Thomas Whyte denied to the Insolvency Service that he had received the petition until late February, although he acknowledged receipt of the email on 5 February 2021, and between 5 and 16 February the balance on the company bank account reduced from £28,150 to a little over £1,590 with payments made to Whyte, the company accountant and others.

The Secretary of State accepted a disqualification undertaking from Thomas Whyte on 7 February 2023 after he did not dispute he had applied for a Bounce Back Loan for his company to which it was not entitled, and had disposed of substantial funds when he knew, or ought to have known, the company was being wound up.

His ban begins on 28 February 2023 and lasts for 10 years. The disqualification prevents him from directly or indirectly becoming involved in the promotion, formation or management of a company, without the permission of the court. The Insolvency Service investigation did not find evidence that warranted any disqualification action against any other individuals in relation to Fortress Restructuring Ltd.

The company’s liquidator has recovered £37,500 from Whyte towards the £50,000 owed.

Rob Clarke, Chief Investigator at the Insolvency Service, said:

Bounce Back Loans were for trading companies adversely affected by the pandemic and to be spent on legitimate business expenses.

The fact that Fortress had filed dormant accounts, and only £949 had passed through its bank account should have made it abundantly clear to Thomas Whyte that his company was not entitled to a £50,000 loan, yet he took it anyway and used the majority of that money for his own benefit.

We thank the liquidator for their efforts which have seen £37,500 recovered, and repeat that we will not hesitate to take action against directors who have abused Covid-19 financial support in this manner.