Taylor and wife given five-year ban as company directors

The founder of the collapsed Taylor group of five finance companies has claimed before the High Court that other directors of companies in the group, including television personality Eddie Hobbs, arranged for the sale of "significant investment products" to customers who were "not tax compliant".

The claims were made by Tony Taylor in affidavits read yesterday during a hearing which resulted in the court making orders, under Section 150 of the Companies Act, restricting both Mr Taylor and his wife Shirley from acting as company directors for five years.

Mr Justice Roderick Murphy said he had "no misgivings" about making the order against Mr Taylor and also believed a similar order should be made against Ms Taylor.

The fact Ms Taylor had said she was a homemaker who played no active part in the companies was not an issue the court could take into account, the judge said.

The emancipation of women had continued to a stage where, when women took on responsibilities as company directors, they must face the same disciplinary matters as their colleagues if such arose.

The judge noted that there had been no criminal proceedings against Ms Taylor and that she was not a director of Taylor Asset Managers, the main company in the group, but she was a director of three other group companies. The official liquidator Paddy McSwiney had not alleged that Ms Taylor had acted other than honestly and responsibly in relation to the companies' affairs, he added.

Rejecting claims of inordinate delay by the liquidator in bringing the Section 150 proceedings, the judge noted Mr Taylor had fled after the group's collapse in 1996 and did not return until 2000 after which he was jailed on pleading guilty to several charges, including three of company fraud.

The liquidator had also brought proceedings to have Mr Taylor made personally liable for the groups' debts and these were settled in 2004.

In those circumstances, there was a delay of some two years which was not inordinate, he ruled.

Earlier this week, the judge refused to make similar restriction orders against Mr Hobbs and two other directors of companies in the Taylor group - Tom Carroll, of Blackrock, Co Cork, and Tom Gerard Lynch, of Tivoli, Cork - after finding all three had acted responsibly in relation to those companies' affairs.

The three men had claimed financial information about the companies was controlled by Mr Taylor and was "blocked" to them and that they were unaware of the serious problems of fraud and misappropriation of clients' money.

Counsel for Mr Taylor had sought to have his affidavit opened in the proceedings relating to the other directors but Mr McSwiney said that he was not relying on that affidavit in the proceedings against the other directors.

The High Court ruled Mr Taylor's affidavit could only be used in the proceedings relating to Mr Taylor himself.

The Section 150 proceedings were brought by Mr McSwiney last July and arise from the collapse of the Taylor companies in 1996 with an estimated £1.73 million missing in client funds, which was never recovered.

Mr McSwiney has said there are insufficient monies in the liquidation for distribution to unsecured creditors. Funds available to him totalled €334,816 while his own fees and outlay in each liquidation were €248,761 and his side's legal fees were €266,200 in November 2004.

The liquidator is obliged to make a Section 150 application which is procedural even if he believes some directors acted fairly and honestly. Mr McSwiney said he has no evidence that Mr Hobbs, Mr Carroll, Mr Lynch and Ms Taylor had acted other than honestly and responsibly and also said he accepted that the person principally responsible for the state of affairs of the Taylor companies "was undoubtedly Mr Taylor".

In affidavits yesterday Mr Taylor said that contrary to the attitude adopted by the official liquidator, Mr Hobbs, Mr Lynch and Mr Carroll were "involved in the sale of significant investment products of the aforesaid type".

On claims that information was "locked out" by Mr Taylor from Mr Hobbs and Mr Carroll, Mr Taylor said that, from about May 1995, some 11 months before Mr Hobbs and Mr Carroll resigned from the companies, he became aware Mr Hobbs was leading a move to set up a business in competition with the Taylor group and, for that reason, he had "consciously limited" the access of the other directors to "sensitive information".