Frederick Bartlett and Clive Tayton – former directors of Bionova Recycling Ltd – were sentenced at Exeter Crown Court last Thursday (11 May) for conspiracy to commit fraud by false representation, dating back to 2013, in a case brought by the government’s Department for Business. They had resigned from the company in May 2014.
Additionally, another former director of the company, Aaron Custance was found not guilty of fraudulent trading after no evidence was offered by the prosecution.
The sentencing comes six months after the directors were disqualified from acting in the management of a company for 10 years by the Insolvency Service over the incident (see letsrecycle.com story).
History
Based in Okehampton, Bionova Recycling Ltd sold and installed digester equipment for converting food waste into biofuel. The firm went into administration in April 2014.
In 2013, the business received a £250,000 loan from the South West Cleantech Co-Investment Fund, which comprised public funds, on condition by the lender that the company had already put up the same amount in matched funding.
To create the evidence that they had invested this money, that the directors transferred £50,000 into the Bionova accounts from an associated account and passed it repeatedly through the company’s bank accounts before paying it back, it was claimed.
Directors at Bionova Recycling then used bank statements showing all the receipts but not the repayments to persuade the lender that the matched funding had been met – when in reality they had introduced no matched funding at all.
According to the prosecution, some of the money loaned to the company was used to satisfy existing debts, in contradiction to the terms of the loan.
The company went into administration in 2014, with the administrators receiving creditors’ claims of £970,000. The loan, which had already been made out by the lender, was not repaid, it was claimed.
At the sentencing hearing last week, Mr Bartlett was sentenced to 18 months in prison, and Mr Tayton received a 20 month sentence.
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