Annual Report 2024 Case Studies

Subject to certain exceptions, company law requires that each year (and not more than 15 months apart), a company must hold an Annual General Meeting (AGM) of the company. The AGM is a meeting of the company’s members/shareholders, at which the financial statements and audit report (where applicable) must be presented to the members/shareholders and where, if applicable, director elections take place. The AGM is therefore a key accountability mechanism from the company’s shareholders’/members’ perspective. 

The notice of an AGM, which must be sent to all members, typically 21 days in advance, will normally include the agenda and the financial statements including copies of the directors’ and auditor’s reports (where applicable, i.e., where the company has not availed of audit exemption).

A complaint was received from a member of the public alleging that a company had failed to convene and hold its AGM. Following CEA intervention, an AGM was called with notices issued to the company’s members. However, the notice which issued was defective as it did not include the documents required to accompany it. Following further engagement, the company issued amended notices providing the required documents to the company’s members. As a result of the CEA’s intervention, the AGM took place in compliance with company law, thereby vindicating the members’ rights.

The CEA conducts routine checks of directors who are subject to restriction or disqualification orders to ensure they have taken the necessary steps to either resign as a company director and/or secretary (disqualification) or to ensure that they are only directors of companies which satisfy the necessary capitalisation requirements (restriction).

An individual who had consented to a disqualification undertaking failed to resign from 7 companies of which they were a director. As there was no evidence to suggest that the individual had actually acted as a director following their disqualification, the CEA wrote to the individual, informing them of the possible consequences of breaching a disqualification order. 

Following engagement with the CEA the individual resigned from all their directorships. Through this administrative action, the CEA promoted the protection of the public by ensuring that a disqualified individual resigned all company directorships.

Section 50 of the Companies Act 2014 requires all Irish companies to have a registered address in the State which must be recorded with the CRO.

The CEA received a complaint from a member of the public who was receiving company post to their residential address. The individual had no prior involvement with the company in question and was distressed by the unsolicited correspondence they were receiving. A CEA case officer obtained contact information for the company’s directors. When contacted by the CEA, the directors took immediate steps to update the company’s registered office address details with the CRO. Once the case officer confirmed that the necessary filings had been made, they informed the complainant. The company was brought into compliance with the Companies Act 2014 and the unsolicited mail to the complainant’s residence ceased. 

Section 50(3) of the Companies Act 2014 allows a period of 14 days from the date of a change in a company’s registered office for the matter to be notified to the CRO. Failure to comply is a category 4 offence. 

The CEA received a complaint from an individual experiencing difficulty serving papers on a company relating to a workplace dispute as the company’s registered address was not up to date on the public register. 

An initial attempt by the directors to update the company details was rejected by the CRO. The case officer continued to engage with the directors to ensure the necessary returns were amended and resubmitted in a timely manner. A subsequent submission was accepted by the CRO bringing the company back into compliance with the Companies Acts. The complainant was notified that a new registered address had been recorded with the CRO.

Section 333 of the Companies Act 2014 requires that a company’s financial statements must be audited by a statutory auditor unless the company is entitled to, and chooses to avail of audit exemption. 

A person is not entitled to act, describe themselves as, or hold themselves out to be a statutory auditor unless they can comply with the provisions of S.I. No. 220/2010 - European Communities (Statutory Audits) (Directive 2006/43/EC) Regulations 2010. Any individual acting as a statutory auditor in Ireland must be a member of a recognised accountancy body and hold the necessary qualifications. 

The CEA was notified that an individual, acting through a company, was advertising the provision of audit services on the company’s website while not entitled to do so. The complainant provided the website details in support of their complaint. Following a review of the Register of Auditors maintained by the CRO the case officer confirmed that the individual listed on the website was not permitted to act as a statutory auditor. A review of CRO submissions established that the individual had not yet acted as a statutory auditor. 

A CEA case officer instructed the company to make necessary amendments to its website and social media accounts to remove all reference to the provision of audit services which they were not qualified to provide. Through this action, the CEA furthered the protection of the public from the risk of engaging audit services from an individual not qualified to provide same

A CEA case officer writes to each process advisor following their appointment reminding them of their reporting obligations. In each instance the case officer confirms that that the appointee holds the necessary qualifications and are not prohibited from acting under the Act. 

During routine searches a CEA case officer identified an individual, who was not qualified to act as a process advisor as they were also a company director, had submitted a ‘Notice of Appointment of Process Advisor’ to the CRO.

Following engagement with the CEA the individual resigned the appointment. No rescue plan had been devised for the company and company creditors were unaffected by the appointment. 

Having developed a rescue plan, process advisors are required to furnish the CEA with a copy of their final report. Each report is considered by a CEA case officer who performs certain checks to confirm that the company has complied with the terms of the rescue plan, particularly in relation to changes to directors, shareholdings, etc. Where changes do not appear to have taken effect, the CEA will engage with the company in the first instance. 

In one instance a CEA case officer noted that the directors had given an undertaking to resign and facilitate the appointment of new directors to secure funding for the company. As this had not occurred, a CEA case officer contacted the company. Following engagement with the CEA the directors resigned, and new directors were appointed. 

The CEA received a complaint that a business was purporting to be a company on its website. A review of the website confirmed the use of the term ‘registered company’ to describe its business. Upon further investigation, a case officer established that the name was that of a registered business name rather than company. 

Following engagement with the business owner, inappropriate and misleading references to a registered company were removed from the website, thereby protecting the public from misleading information. 

The role of a company director is a significant one and brings with it many responsibilities which can be quite onerous. With this in mind, section 142 of the Companies Act 2014 prohibits any individual from holding more than 25 company directorships at one time. However certain exceptions do apply including:

• public limited companies, which are omitted from the cap,
• group companies, which are only counted as one if the person is also a 
  director of the holding company, and
• where the company has lodged a notice with the CRO that the 
  company falls within the excluded categories for the purposes of 
  determining the number of companies of which a person is a director. 

A newspaper article published during 2024 suggested that 151 individuals were in breach of the requirement to hold no more than 25 directorships. A review of the Register of Companies by a CEA case officer identified 480 individuals who held more than 25 directorships. Following a review of approximately 18,000 companies, and applying the various exemptions, it was established that 18 individuals were in breach of section 142 of the Companies Acts. 13 individuals brought themselves back into compliance by the end of the year following engagement with the CEA. Case officers continue to engage with the remaining individuals, with most now in compliance, thereby ensuring that this important provision of company law is being respected.

A company is obliged to deliver an annual return at least once in every year to the CRO. The return must be filed within 56 days of the company’s Annual Return Date. If a company fails to comply, the company, and any officer of it who is in default, shall be guilty of a category 3 offence.

On foot of several complaints relating to charities that were not filing their annual returns, the CEA conducted a review of outstanding returns on the part of all charities registered with the CRO. It was established from that review that 497 annual returns, relating to 92 companies, had not been filed. Following further reviews, CEA case officers contacted all of the charities. Arising from the CEA’s work, a total of 41 charities achieved compliance by submitting all outstanding annual returns by the end of the year. A further 31 companies brought their filings up to date shortly after the year end. The CEA continues to progress the matter with the remaining 20 charities.

In addition to filing an annual return with the CRO, incorporated charities are also required to file an annual report with the Charities Regulator. The CEA conducted a review to identify charities where the directors’ details filed with the CRO did not match the trustee details filed with the Charities Regulator. 

Following its review of 293 charities, the CEA identified 13 companies where incorrect information was held by the CRO. In the remaining 280 instances, it was suspected that up to date information may not have been submitted to the Charities Regulator. 

By the year end, following engagement with the CEA, 10 of the companies had made the necessary filings to bring the companies into compliance. A further 2 achieved compliance shortly after the year end.

Section 137 of the Companies Act 2014 requires a company to have at least one EEA resident director unless the company avails of certain exemptions i.e. submits a bond to the CRO or obtains a certificate of real and continuous links from the CRO. Where the exemptions are availed of the company must have a director, but they are not required to be EEA resident. 

Where a company director notifies a company of their resignation, but the company fails to make the necessary submission to the CRO within 21 days, the individual may notify the CRO directly of their resignation by making the necessary submission. 

A review undertaken by the CEA identified 519 companies left without a director after individuals had notified the CRO directly of their resignation. It is impossible for a company to comply with its various obligations under the Companies Acts without a director. The CEA provided the CRO with a list of affected companies as they may be suitable for strike-off under the CRO’s strike-off regime. 

An examination of the Register of Companies disclosed that BGHL had failed to file Annual Returns in accordance with section 343(2) of the Act of 2014 for the years 2021-2023 inclusive. 

On 6 March 2024, the CEA issued a section 797 Notice addressed to both BGHL and its director, Mr. David O’Shea, requiring the lodgement of annual returns and accompanying financial statements with the CRO for three separate years.

Similarly, an examination of the Register of Companies disclosed that CQC II had also failed to file Annual Returns in accordance with Section 343(2) of the Act of 2014 for the years 2020 – 2023 inclusive. On 6 March 2024, the CEA also issued a statutory Notice to CQC II seeking delivery of Annual Returns for four separate years.

Both companies were advised that failure to comply with their obligations within the timeframe specified in the Notices, would result in an application to the High Court pursuant to Section 797(4) of the Companies Act 2014 for Orders to compel such compliance, together with Orders for the costs. 

Both companies were part of a larger group and argued that they needed time to access relevant material to comply with their obligations. The CEA facilitated those requests, albeit pointing out that the default had existed for some time.

Notwithstanding the latitude given to the companies, they failed to comply with the Notices within the time allowed. The CEA brought motions against both companies, which came before the High Court on 29 July 2024. On that date the companies consented to Orders being made against them, including Orders for costs.

The Orders of the High Court stipulated a period within which compliance should occur and, there being no compliance, the CEA considered penal enforcement. Both companies have subsequently gone into liquidation.

The liquidator of an insolvent company is obliged to provide a statutory report to the CEA under section 682(2) of the Companies Act 2014 (the Act), which sets out the reasons for the insolvency of the company, and the liquidator’s assessment of the conduct of its directors. Such reports assist the CEA in carrying out its functions. A liquidator is required to file a first section 682 report within 6 months of appointment, and at intervals as requested by the CEA thereafter until the conclusion of a liquidation. 

Failure to submit the section 682 report on time is a Category 3 offence and, accordingly, exposes such a liquidator to potential criminal liability.Mr. Patric Black was appointed liquidator of six companies and was obliged to submit reports under section 682 to the CEA in respect of each company. He failed to comply with this obligation. In spite of repeated requests, which included warnings of the consequences of his failure to submit the reports, the reports were not received.

Notices were issued to Mr. Black requiring him to file the reports within 14 days and advising him that failure to do so would result in the CEA applying to the High Court for Orders directing him to comply with his statutory obligations. The notices also indicated that the CEA would seek an Order that all costs of, and incidental to, the application would be borne by Mr. Black personally.

As Mr. Black failed to comply with the notices issued by the CEA, an application was made to the High Court pursuant to section 797 of the 2014 Act. The matter came before Mr Justice Brian Cregan on 11 November 2024, who made the Orders compelling Mr Black to deliver the outstanding reports to the CEA, together with Orders for costs in the CEA’s favour. The reports have now been duly filed by Mr. Black

SDM Emerald Green Exports Limited was incorporated in December 2013 and ceased trading only a year later in December 2014, owing substantial liabilities to creditors. The company was liquidated in April 2015 on the application of a creditor who petitioned the High Court to wind up the company. 

The liquidator reported that no adequate explanation was forthcoming from the directors as to how such a large deficit of €687,923 as per the Estimated Statement of Affairs couldhave built up in such a short period of time. The directors also failed to have accounts or financial statements prepared from the date of incorporation up to the date of liquidation and, accordingly, it was not possible to determine the full extent of the company’s assets and liabilities. A Revenue audit did establish a substantial VAT liability which, together with interest and penalties, totalled €793,573.

Arising from his investigations, the liquidator formed the opinion that Mr. Sean Mitchell was a shadow director of the company, and the main driver who was responsible for the management of the company’s affairs. The liquidator’s investigations were severely hampered by a lack of cooperation from the directors and the paucity of books and records. The liquidator took the view that certain of the directors had not acted honestly and responsibly and did not seek relief from his obligations to seek their restriction.

Following its review of the liquidator’s reports, the CEA offered restriction undertakings to both Mr. Sean Mitchell and Mr. Daniel Mitchell, who consented to restriction for a period of 5 years. Relief was granted in respect of the remaining directors, who were found to have acted honestly and responsibly.

Boxer Logistics Limited was incorporated on 18 October 2017 and traded for a period of approximately 4.5 years. It operated as a home delivery and freight transport business providing services to established businesses throughout Ireland and the UK. The directors at the time of appointment were Mr. Stewart Alexander and Mr. Bill Henry.

Two personal bank accounts were used to facilitate the misappropriation of company funds by the directors and their associates, including the facilitation of large-scale tax evasion, fraudulent claims under the Temporary COVID-19 Wage Subsidy (TWSS) Scheme and Employment Wage Subsidy Scheme (EWSS). These accounts were also used to facilitate fraudulent and reckless trading.

The directors’ estimated statement of affairs failed to account for vehicles that were company assets used by officers of the company. The directors sold 5 motor cars belonging to the company with a value of €353,700 in the week leading up to the creditors meeting on 24 March 2022. 

The company’s statement of affairs showed a net liability of approximately €245,756 owing to the Revenue Commissioners. Following their review of the company accounts, the joint liquidators formed the view that the company was not eligible to participate in the EWSS scheme, under which it had received approximately €1.93m. A number of substantial transactions to employees, as well as various sales transactions, were not recorded correctly in the accounting systems of the company, leading to an estimated Revenue liability of approximately €6m. 

The directors of the company managed the business and finances through one account in the company’s name and two other accounts in the name of Mr. Stewart Alexander. This was done to conceal the true position in respect of the company’s income and payments to employees and contractors in order to minimise its obligations to Revenue.

The Company did not maintain proper books and records and the directors were found to have placed their own interests ahead of the interests of the company’s creditors. The liquidators also obtained a judgment of €12.4 million against Mr. Bill Henry and Mr. Stewart Alexander.

Following its examination of the joint liquidators’ reports, relief was not granted by the CEA in respect of Mr. Stewart and Mr. Henry. Disqualification undertakings were not offered, as the CEA took the view that the directors’ conduct was so serious that the High Court should be afforded the opportunity to consider the matter and to determine, if appropriate, the suitable length of any disqualification(s). Following an application by the joint liquidators, the High Court imposed a 14 year disqualification on both directors.

The company was incorporated on the 25 April 1996 and went into liquidation in April 2014. The principal business of the company was the wholesale of fruit and vegetables and related products.

The directors were also directors of related companies Haupt Distribution Limited (trading as Bestway), and Bestwell Limited (trading as Cash and Carry Direct). The liquidator, through the investigation found that the business of the company was transferred to Haupt Distribution Limited, which continued to operate as a ‘phoenix’ company after Swan Fruit Limited went into liquidation. In March 2014, employees of the company were informed by the directors that it had ceased to trade and that they were now employees of Haupt Distribution Limited.

Due to the lack of accuracy of the financial statements, the liquidator was unable to determine if inter-company trading existed between the Company and Haupt Distribution Limited and Bestwell Limited. The Statement of Affairs presented to the creditors’ meeting failed to give accurate valuations of book debts, did not record certain unsecured non-preferential creditors and failed to take into consideration the transfer of goodwill to Haupt Distribution Limited. The Revenue Commissioners were owed preferential debts of almost €820,000, approximately €740,000 of which was VAT. The company’s liabilities tounsecured creditors were almost €1.8 million.

In 2019, the liquidator commenced proceedings against the directors and an Order was made on the 29 July 2024 disqualifying one of the directors and restricting the other two directors for a period of five years each.

The company was incorporated on 13 August 2012 and traded for seven years, providing services to the Child and Family Agency and the Health Service Executive respectively in connection with the care of highly vulnerable teenagers and young adults.  The company went into liquidation in 2019 with an estimated deficit of €623k recorded in the Statement of Affairs.  

The liquidator attributed the reasons for the company’s insolvency to the misappropriation of company funds by the director and a former manager of the company, which was facilitated by a failure to maintain a proper system of controls.

A former manager of the company had been found to have diverted petty cash funds from the company.  The director, Bernard Morrin, had originally highlighted this fact in the winding up application, stating that the amount was €215,000. The liquidator determined that a total of €354,029 had in fact been diverted by the manager for his personal use and took proceedings against this individual for the recovery of these funds.

The liquidator identified large unexplained withdrawals and payments in favour of the director, Mr. Bernard Morrin, and his family, of approximately €500,000 over a four-year period. PAYE/PRSI was not declared on most of those withdrawals.  

The directors failed to discharge taxes over a sustained period with liabilities of €524,000 due to Revenue at the time of liquidation. The liquidator also identified serious deficiencies in the company’s management and human resource practices and identified significant failures relating to compliance with employment law.  

The director had indicated to the liquidator that he would be prepared to submit to a disqualification undertaking, and be disqualified for a period of 5 years. However following its review of the case, the CEA declined to make such an offer. The CEA took the view that the director’s conduct, and the misuse of monies expended by the State to deliver a critical public service, was sufficiently grave as would justify the imposition of a disqualification period significantly in excess of 5 years. The liquidator was advised by the CEA that he was obliged to bring High Court proceedings seeking to have the director disqualified. 

When the matter first came before the Court on 13 January 2025, Mr. Morrin indicated that he was prepared to consent to a disqualification for a period to be determined. The Court determined that the appropriate period in this case was a 12 year disqualification. 

Mr. Simon Kelly was a director of 27 companies which were involuntarily struck off the Register of Companies for failing to file annual returns. The companies were profiled by the CEA and a number of them, namely Berlin Entertainment Limited, Independent Leisure Solutions Limited, Irish Italian Property Holdings Limited, Pressaro Limited, Kingswood Lane Developments & Investments Limited, Thedforde Trading Limited, Rexdale Limited, and Complete Business Solutions Limited were found to have had liabilities at the date on which they were struck off the Register.

A notice issued to Mr. Kelly pursuant to section 842(h) of the 2014 Act advising that, as he had allowed companies with debts on record to become involuntarily struck off, he was now liable to be disqualified. While the notice also advised that he could restore the companies to the Register as an alternative to disqualification, Mr. Kelly did not pursue that course of action.

Following significant engagement, Mr. Kelly was offered, and accepted, the opportunity to voluntarily submit to a disqualification undertaking. As a result, he was disqualified from acting as a company director for a period of four years commencing on 12 September 2024.

Following a CEA investigation, Mr. Ebenezer Oduntan, a Kildare-based pastor of the Redeemed Christian Church of God (RCCG) (City of David), was convicted of 9 company law offences (namely, providing false information), as well as 73 counts of theft, and 5 counts of deception. The aggregate amount involved in the theft charges exceeded €125,000.

Midway through the trial, Mr. Oduntan pleaded guilty to 4 counts of furnishing false information to the CRO contrary to section 242 of the Companies Act 1990, 5 counts of furnishing false information to the Companies Registration Office contrary to section 876 of the Companies Act 2014, 5 counts of deception contrary to section 6 of the Criminal Justice (Theft and Fraud Offences) Act 2001, and 19 counts of theft contrary to section 4 of the Criminal Justice (Theft and Fraud Offences) Act 2001. 

On 13 March 2024, the jury returned verdicts of guilty on all 54 outstanding counts on the indictment.Imposing a sentence of seven years’ imprisonment, with the final six months suspended, Judge Martina Baxter referred to the position of trust that Mr. Oduntan held as pastor of the Church. She referred to the ‘quite substantial amount of control that he had’ and observed that ‘no one ever questioned him. They trusted him, such was the esteem in which he was held at that point in time.’ Judge Baxter further stated that ‘clearly, it was a very prolonged, premeditated, and well-planned scheme on the part of Mr. Oduntan. As he created the financial structures, there was no oversight and no accountability.’ 

The aggravating factors identified by the Judge included the significant sums involved and the fact that there had been no attempt at restitution. She said that ‘this was a complex, sophisticated and pre-planned crime. He treated the Church funds as his own.’ Judge Baxter further stated that ‘serious wrongdoing requires a severe sentence to reflect the censure of society.’ She noted that, while Mr. Oduntan had pleaded guilty to some counts mid-trial, the pleas did not reduce the complexity of the trial: ‘When he pleaded, that evidence was already there.’ She concluded that his culpability was high, and that he had lost all available discounts on the sentence to be imposed.

Following a CEA investigation, Dr. Andrew Jordan, former Chairman and Secretary of the National Association of General Practitioners (NAGP), was fined €10,000 in respect of company law offences. Dr. Jordan pleaded guilty to two Category 1 company law offences of having failed to take all reasonable steps to secure the NAGP’s compliance with its accounting obligations. 

In addition to the fine imposed by the Court, Dr. Jordan was also automatically disqualified from acting as a director for a period of five years as a consequence of the conviction. During sentencing at Dublin Circuit Criminal Court, Judge Martin Nolan noted that the purpose of company law is ‘to make sure people behave appropriately and honestly in relation to company property, and so they do not expose creditors of the company to losses.’ He said that Dr. Jordan failed in his duties as a director and secretary.

Following a CEA investigation, Mr. Thomas Colton, a former director of Grá agus Solas Unlimited Company, pleaded guilty to the company law offence of acting as a company director while disqualified from doing so, an offence contrary to section 855 of the Companies Act 2014. 

On 7 April 2025 Mr Colton received a disqualification order prohibiting him from acting as a company director for 10 years. In addition, he received a 9 month prison sentence, which was fully suspended. During sentencing Judge Sinéad McMullan said, ‘there is a strong public interest in the regulation of companies.’ Judge McMullan also noted that it was the first prosecution of a person who had contravened an automatic disqualification arising from previous convictions for company law and other offences.