HC Deb 30 November 1979 vol 974 cc859-61W
Mr. Wigley

asked the Secretary of State for Trade (1) when he expects to publish the report of his Department's investigation into the affairs of the Gilgate group of companies;

(2) what steps he has taken to ensure that the delays in concluding the investi- gation into the Gilgate group of companies are not jeopardising the interests of the shareholders and creditors of the companies involved.

Mr. Eyre

There has been no delay.

The matters under investigation are complex and the inspectors have found it necessary to extend their inquiries into connected companies.

My officials continue to hold regular meetings with the inspectors to ensure prompt completion of the investigation.

The inspectors have submitted an interim report, as a result of which my right hon. Friend, the Secretary of State has presented petitions to wind up Gilgate Construction Limited, Gilgate Securities Limited, Orthomere Limited and South Bucks Properties Limited. A winding-up order has been made against Gilgate Construction Limited whilst the remaining petitions are opposed and have been adjourned. It would not be appropriate to publish the interim report pending the outcome of these petitions. The inspectors have not yet submitted a final report.

Following information received from the inspectors, two connected insurance companies were convicted on 26 October 1979 of making investments in the form of loans to Gilgate Securities Limited contrary to a requirement imposed by my right hon. Friend, the Secretary of State, under section 30 of the Insurance Companies Act 1974, and of furnishing information to the Department which they knew to be false in a material particular, and a director was convicted of consenting to or conniving at the commission of the offences. These convictions are under appeal.

My right hon. Friend has applied to the High Court for orders under section 28 of the Companies Act 1976 that three directors of the Gilgate group of companies be disqualified from being a director or acting in the management of a company for a period not exceeding five years, without the leave of the court. The application has not yet come to trial.

The foregoing action was taken in the interests of shareholders, creditors and the public. I must stress however that the appointment of inspectors does not relieve companies of their obligation to keep shareholders and creditors informed by holding annual general meetings and filing annual accounts and returns with the Registrar of Companies.