Pre-pack recruitment king McMurray folds seven firms owing 10m in two year
"Pre-pack" recruitment king McMurray folds seven firms owing £10m in two year
By Nick Sommerlad – Daily Mirror.
When a firm fails, it can be bad luck. Two failures might look careless. But seven in two years?
At an age when most people are just happy to still be here, 82-year-old Tom McMurray is hard at work as a .. well, a failed businessman.
We've found that he has folded seven employment agency firms in under two years, dumping over £10m in debts, before buying them back and carrying on trading.
McMurray is the master of the "pre-pack" administration, a controversial type of deal that allows an owner of an insolvent business to carry on under a new name without those owed money getting any say in it.
We'll start in December 2009, when Staffwise Holdings and two subsidiaries, with over 1,600 temporary workers on their books, went bust owing £5.3m, including £4.4m in unpaid taxes to HM Revenue and Customs.
Staffwise area manager Lorraine Turnbull, 40, from Chester le Street, was put on "gardening leave" weeks before Staffwise went bust. She had applied for £11,000 voluntary redundancy but was left claiming a fraction of that from the Government's redundancy scheme.
Under a pre-pack deal agreed with the administrators, another McMurray firm called Staffwise SW bought the assets of the two subsidiaries for £406,000.
But Staffwise SW fared no better, losing two major clients in early 2010, and it went into administration in June owing £2.3m to HMRC.
Meanwhile, sister firm Staffwise South, bought by McMurray the previous year, also went into administration at the same time owing £640,000 to HMRC.
Once again, McMurray was allowed to buy those two businesses back for £425,000 under the name Staffwise Nationwide. But only £90,000 was ever paid, as Nationwide "failed to keep to the agreed payment plans" and it "began to experience cashflow difficulties". It went into administration in January last year owing £1.3m.
Yet again, the administrators decided a pre-pack sale would be the best option.
That's because competitors could "cherry pick" the best staff and clients if it was known the firm was in trouble, leaving even less value in the company for creditors.
This time it was sold in for £105,000 to Alexander Maguire Limited, a firm run and owned by McMurray's daughter Nicola Crabtree. McMurray "confirmed he does not have any involvement with the purchaser", said the administrator.
But only £50,000 was ever paid as, within months, Alexander Maguire too began to "experience cashflow difficulties".
Meanwhile, yet another McMurray firm Revive Nationwide had gone under owing £610,000 to HMRC. It too was sold to Alexander Maguire for £35,000, which itself went bust eight months later, owing £820,000 to HMRC.
This time there was no pre-pack and Alexander Maguire staff were left owed £36,000. One missed out on nine years' redundancy pay, another was able to claim just £2,000 out of £5,000 owed from the administrators.
Gary Richards, from Bristol, was owed £1,000 in unpaid expenses and said: "I worked for them for three years and the name of the company changed half a dozen times. They shouldn't be allowed to get away with the damage they have done."
We've found that another McMurray recruitment firm, Dionisus, was shut down by the high court in 2010 owing £1.1m.
So that's nine firms gone belly up in under two years owing a grand total of over £12m, the vast majority to HMRC - that all of us who pay our taxes.
McMurray wouldn't comment on any of these firms as he was facing "ongoing court proceedings", adding it was "premature to draw any conclusions from insolvencies which have not yet concluded".
But we've found he's still at it.
In September he bought another agency called Capital Public Sector which, by the end of the year, was unable to pay its VAT bill. It went into administration last month.