The former boss of a claims management company has been ordered to pay more than £25,000 after he could not show where the business’s money had gone.

Haroon Karim, who ran several CMCs handling personal injury claims, was investigated after one of his businesses entered into creditors voluntary liquidation in August 2016.

Karim, 35, failed to deliver the records of the failed company, ACA Accident Claims Assistant Ltd, despite repeated requests from the Insolvency Service, and later told investigators he had delivered the documents to another party.

The service said further enquiries uncovered bank records showing that Karim spent company money on unnecessary expenses despite his company’s debts, including buying a suit worth £1,000 to attend an awards ceremony.

A criminal investigation resulted in Karim being charged on three counts, including: failing to deliver up books and records to the liquidator; failing to cause ACA Accident Claims Assistant Ltd to keep accounting records and failing to preserve company accounting records.

Nottingham Magistrates Court

Nottingham Magistrates Court: Karim pleaded guilty to failing to preserve company accounting records

Source: Alamy

Karim, from Bramcote in Nottingham, pleaded guilty at Nottingham Magistrates Court to failing to preserve company accounting records. He was fined £20,000 and ordered to pay costs of £5,715. He was also disqualified from running companies for two years, to run concurrently with a seven-year ban he received in 2018.

Julie Barnes, chief investigator for the Insolvency Service, said: ‘Haroon Karim was evasive throughout our enquiries and with a lack of company records was unable to explain exactly what happened to the company assets – something we’ll never know. But the court recognised the severity of the claims management boss’ misconduct and have not only extended his ban from running limited companies but ordered Haroon Karim to pay a substantial fine.’

In a separate trial, Karim was sentenced to six months for contempt of court. This was in connection with a claim brought by an insurance company in 2017 after Karim had forged a claimant’s signature without their knowledge to start compensation proceedings.