London-based dealer Smart Tek has been given a winding up order by Manchester High Court after being found to have traded irresponsibly on cashback deals.
The company was deemed to have traded in a manner contrary to the public interest and the Insolvency Service has estimated it owes £410,000 to creditors.
The dealer offered customers cashback, but made no provision to pay it and failed to keep adequate accounting records, meaning a final figure of its liabilities has yet to be reached.
The investigation found Smart Tek’s business model was unsustainable, customers’ data had been misused in breach of the Data Protection Act and funds had been misused.
A Insolvency Service spokesperson said: “It is our statutory duty to interview the directors. If there has been any wrong doing we can ask for them to be disqualified from being a company director.
“Given the severity and amount of findings it would be very unusual if we did not bring disqualification proceedings.”