The debt bosses’ failure results in a £ 7.6 million shortfall
Darren Dean Varden, 54, of Bury, Lancashire, and Philip Andrew Nuttall, 58, of Congleton, Cheshire, were Directors of Varden Nuttall Limited, a debt solutions provider based in Bury.
Philip Nuttall was licensed as a liquidator to act in relation to bankrupt individuals and companies. Together with a small team at Varden Nuttall, he managed Individual Voluntary Arrangements (IVAs) – formal agreements between a debtor and his creditors to repay money owed.
At its peak, the company processed over 3,000 IVAs, but neither Philip Nuttall nor Darren Varden were properly performing their duties as directors because they did not properly oversee the bank accounts in which the IVA funds were held.
A significant accounting mismatch was identified in August 2015 and an internal investigation found an estimated deficit of £ 6.6million.
Philip Nuttall was required to notify his regulator and after assessing his conduct, the regulator decided in early March 2016 to revoke Philip Nuttall’s license.
Varden Nuttall Limited joined the administration shortly thereafter. After realizing the extent of the financial deficit, the appointed administrators filed civil lawsuits against the two directors in May 2017.
Darren Varden took personal liability for the shortfall and entered an IVA instead of filing for bankruptcy.
However, Philip Nuttall denied the allegations and the matter was brought to trial in May 2018. As a result of the lawsuit, he was also personally held liable for the £ 7.6 million shortfall found by the court.
Varden Nuttall’s trustees had also filed a report on the conduct of the directors with the bankruptcy service, which sparked an investigation in September 2016.
Upon closer inspection, the investigators discovered further misconduct by the couple.
Varden Nuttall was one of several companies owned by Release Money Group (RMG) Limited, an umbrella company of which both men were also directors. Although Philip Nuttall and Darren Varden knew there was a potential underfunding at Varden Nuttall and Group assets could be required to settle due to a bonded guarantee held by the bank, Philip Nuttall and Darren Varden removed assets from RMG as of October 2015.
They recycled funds with other management companies through an elaborate escrow program to pay off two director loans totaling more than £ 1.6 million that they had raised through RMG. These assets would likely have been used to reduce the deficit at Varden Nuttall.
The Secretary of State has since accepted disqualification obligations from Phillip Nuttall and Darren Varden for 9 and 7 years respectively. The couple are excluded from direct or indirect involvement in starting, promoting or running a business without the consent of the court.
Anthea Simpson, Senior Investigator for the Bankruptcy Service, said:
Philip Nuttall and Darren Varden abused the trust of their customers suffering from debt problems by failing to adequately monitor the company’s financial transactions. That alone would have justified their disqualification in this case, but they made the problem worse when they used an intricate escrow system to repay loans that would otherwise have been assets under management.
This behavior has resulted in Philip Nuttall and Darren Varden being prevented from serving as directors again for an extended period of time.
Notes for editors
Philip Andrew Nuttall was born in Congleton, Cheshire (formerly New Mills, Derbyshire) in February 1961. His suspension with effect from July 17, 2019 lasts 9 years. His approval as an insolvency administrator was withdrawn by the ICAEW with effect from April 1, 2016.
Darren Dean Varden is from Bury, Greater Manchester and his date of birth is June 1965. His suspension effective April 11, 2019 is 7 years.
Varden Nuttall Limited (company number 04669168).
Release Money Group (RMG) Limited (company number 07154076).
Other companies that made up the Release Money Group were:
- Debt Release Direct Ltd (Company Reg no. 04730443), which was incorporated on April 10, 2003 and went into administration on March 24, 2017
- Your Claim Refunded Ltd (Company Reg no. 07398617), which was founded on October 6th, 2010 and went into administration on October 25th, 2016
More information on individual voluntary agreements (IVA).
A disqualification order or obligation to disqualify has the consequence that a person with a disqualification will not:
- act as a director of a company
- participate directly or indirectly in the promotion, establishment or management of a company or limited partnership
- be a recipient of company property
Disqualification obligations are the administrative equivalent of disqualification orders, but do not involve legal proceedings. Persons affected by a disqualification are subject to a number of other restrictions.
Further information on the work of the insolvency service and complaints in the event of financial misconduct.
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