Case details for Josephine Lester BROADSTOCK

Name: Josephine Lester BROADSTOCK

Name: SMOOTH FINANCIAL CONSULTANTS LIMITED

Date of Birth: 2 / 3 / 1985

Date Order Starts: 29 / 8 / 2018

Disqualification Length: 8 Years 0 Month(s)

CRO Number: 05346052

Last Known Address: 24 Claydon Gardens,, Rixton,, , , WARRINGTON,, WA3 6FA

Conduct: Between at least 12 February 2013 and 02 August 2013, in breach of trust and her fiduciary duty to Smooth Financial Consultants Ltd (“Smooth”), guidance issued by the Office of Fair Trading (“OFT”) dated March 2012, and Smooth’s own Terms and Conditions, Josephine Lester Broadstock (“Mrs Broadstock”) failed to ensure that Smooth, a debt management company, made all payments due to clients’ creditors, and caused or allowed transfers to be made from Smooth’s bank Client Account to Smooth’s bank Current Account and to a connected company, in excess of fees due to Smooth, at a time when Smooth was unable to repay these sums, to the detriment of Smooth’s clients and to her benefit and third parties connected to her, in that:

  • Smooth operated as a debt management company under a Consumer Credit Licence which was renewed by the OFT on 17 March 2010 for an indefinite period. During May 2011, she attended a meeting at which the accountant for Smooth states he advised me there was a shortfall of client funds, due to over payments to the Company Account in excess of fees, which, following reconciliation of the client accounts was found to be a maximum of £188,400. By 12 February 2013 her co–directors were discussing via email a shortfall of client funds of £450,000 as at 31 January 2013. Her having raised the issue of non-payment of clients’ creditors with her co-director on 07 November 2012.
  • Within Smooth’s records delivered up to the Joint Administrators was a document issued by the OFT dated March 2012, entitled ‘Debt management (and credit repair services) guidance’, (“the OFT guidance”) and a document dated 22 February 2012, entitled ‘Smooth Financial Consultants Limited – Terms and Conditions of Trading’ (“Terms and Conditions”). Both of these documents stated that payments to a client’s creditors should be made within 5 working days from receipt of cleared funds from the client.
  • The OFT guidance stated ‘It is unlawful for a licensee to spend consumer client’s money on its own account since it is held on trust on behalf of the consumer client and is not the licensee’s to spend.’ Smooth’s Terms and Conditions stated ‘funds held for distribution to your Creditors will be retained for that purpose only.’
  • Between at least 12 February 2013 and 19 July 2013 the Joint Administrators’ analysis indicates that Smooth raised cheques on the bank Client Account to an estimated value of £572,001 which were not either presented to the company’s bank for payment, or returned unpaid by the bank. This sum included cheques to a value of £146,056 printed between these dates, which were in a box delivered to the Joint Administrators. This caused Smooth’s clients to suffer detriment in that funds supposedly paid to Smooth to settle debt liabilities were not paid over to their creditors as required leaving client debts outstanding.
  • Notwithstanding that the company failed to make all payments due to clients’ creditors, Smooth informed some clients that payments to their creditors had been made.
  • Amounts transferred from Smooth’s bank Client Account to Smooth’s bank Current Account in excess of fees due to Smooth were used, to the detriment of the company’s clients, for the ongoing costs of running Smooth’s business and to her own benefit; her co–director received dividends totalling £27,250 and she, received dividends totalling £11,150 out of total gross payments to the directors in the period of £115,992.
  • Between 25 March 2013 and 19 July 2013 transactions totalling at least £14,677 were made through Smooth’s company credit card for her personal benefit or third parties connected to her, comprising £4,000 in respect of a legal dispute, £4,247 in respect of holiday and airline tickets; £5,330 in respect of the first instalment of a payment plan to purchase 4 season tickets in an executive lounge of a premier league football club; and £1,100 in respect of an anniversary party.
  • Between 19 July 2013 and 26 July 2013, when there was an outstanding Winding up Petition against Smooth, a total of £109,511 was transferred directly from Smooth’s Client Account to a connected company, with only £49,677 subsequently being available to transfer to the Joint Administrators of Smooth. None of the funds transferred by Smooth and retained by Contingence Ltd, totalling £59,834, were used for the benefit of Smooth’s clients, with a total of £10,735 being transferred to her co-director and £2,604 being transferred to her.
  • At the date of Administration the Joint Administrators of Smooth calculated that the company had liabilities totalling £1,459,069, of which the Joint Administrators calculated £848,690 was owed to clients of Smooth; and that Smooth had assets of £1,366,979 of which £158,150 is owed to Smooth by the directors and £591,825 is owed to Smooth by associated companies of which she and/or her co – director were directors. 

    This information is correct as at 8 / 3 / 2019


    Name: Robert Mark JONES

    Name: SMOOTH FINANCIAL CONSULTANTS LIMITED

    Date of Birth: 20 / 11 / 1978

    Date Order Starts: 29 / 8 / 2018

    Disqualification Length: 7 Years 0 Month(s)

    CRO Number: 05346052

    Last Known Address: 14 Huxley Drive,, Bramhall,, , , STOCKPORT,, SK7 2PH

    Conduct: 1. Between at least 12 February 2013 and 15 May 2013, in breach of trust and his fiduciary duty to Smooth Financial Consultants Ltd (“Smooth”), guidance issued by the Office of Fair Trading (“OFT”) dated March 2012, and Smooth’s own Terms and Conditions, Robert Mark Jones (“Mr Jones”) failed to ensure that Smooth, a debt management company, made all payments due to clients’ creditors, and caused or allowed transfers to be made from Smooth’s bank Client Account to Smooth’s bank Current Account in excess of fees due to Smooth, at a time when Smooth was unable to repay these sums, to the detriment of Smooth’s clients and to the benefit of himself, in that: I. Smooth operated as a debt management company under a Consumer Credit Licence which was renewed by the OFT on 17 March 2010 for an indefinite period. During August 2011 at the latest, the accountant for Smooth had advised him that there was a shortfall of clients’ funds, due to over payments to the Company Account in excess of fees, which, following reconciliation of the client accounts was found to be a maximum of £188,400. By 12 February 2013 his co-director and he were discussing via email a shortfall of client funds of £450,000 as at 31 January 2013. II. Within Smooth’s records delivered up to the Joint Administrators was a document issued by the OFT dated March 2012, entitled ‘Debt management (and credit repair services) guidance’ (“the OFT guidance”), and a document dated 22 February 2012 entitled ‘Smooth Financial Consultants Limited – Terms and Conditions of Trading’ (“Terms and Conditions”). Both of these documents stated that payments to a client’s creditors should be made within 5 working days from receipt of cleared funds from the client. III. The OFT guidance stated ‘It is unlawful for a licensee to spend consumer client’s money on its own account since it is held on trust on behalf of the consumer client and is not the licensee’s to spend.’ Smooth’s Terms and Conditions stated ‘funds held for distribution to your creditors will be retained for that purpose only.’ IV. Between at least 12 February 2013 and 15 May 2013 the Joint Administrators’ analysis indicates that Smooth raised cheques on the bank Client Account to an estimated value of £69,223 which were not either presented to the company’s bank for payment, or returned unpaid by the bank. This sum included cheques to a value of £12,490 printed between these dates, which were in a box delivered to the Joint Administrators. This contributed to the detriment that Smooth’s clients suffered in that funds supposedly paid to Smooth to settle debt liabilities were not paid over to their creditors as required leaving client debts outstanding. V. Notwithstanding that the company failed to make all payments due to clients’ creditors, Smooth informed some clients that payments to their creditors had been made. VI. Amounts transferred from Smooth’s bank Client Account to Smooth’s bank Current Account in excess of fees due to Smooth were used, to the detriment of the company’s clients, for the ongoing costs of running Smooth’s business and to his own benefit; he received dividends totalling £8,750 between 12 February 2013 and 15 May 2013 (being £2,917 per month), as part of his gross income of £10,000 per month out of total gross payments to the directors of £115,992 to Administration. VII. By the time he had left the company in May 2013 the shortfall of client funds had increased to £670,076 according to an email he had sent to his co-director at that time. At the date of Administration the Joint Administrators of Smooth calculated that the company had liabilities totalling £1,459,069, of which the Joint Administrators calculated £848,690 was owed to clients of Smooth; and that Smooth had assets of £1,366,979 of which £158,150 is owed to Smooth by the directors and £591,825 is owed to Smooth by associated companies of which he had been a director between 31 January 2012 and 28 June 2013. 

    This information is correct as at 8 / 3 / 2019



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