Leeds businessman jailed for stealing £600k from doomed company

A court heard creditors were left owed one million pounds after Leeds-based Western Civil Engineers Ltd went into liquidation shortly after Trevor Gaughan began siphoning off money from the company as the credit crunch began to bite

Gaughan, who prosecutors said was acting as a ‘shadow director’, transferred huge sums from the company’s account to another company he helped set up called Western Civil Engineers (Recuitment).

Katherine Robinson, prosecuting, said the newly created company did not trade in its own right. The only money that went through its account was £612,000 in 12 different transactions during a five week period in late 2009.

The cash from that account was then “filtered” into other businesses with which Gaughan had direct links to. One firm, called Western Structures Ltd, was registered to his home address.

Leeds Crown Court heard Gaughan also invested more than £200,000 of the stolen money into other companies for his own benefit.

Gaughan, of Holly Way, Killingbeck, Leeds, was jailed for three years and seven months yesterday after he pleaded guilty to theft.

At the time of the illegal transactions, Gaughan, whose company T Gaughan Civil Engineers, based in Rothwell, Leeds, went bust in 2007 owing more than 800,000, was subject to a five-year disqualification from being a director or from being involved in the running of a company.

Miss Robinson said Western Civil Engineers began to suffer throughout 2009 as a result of the economic downturn.

The offences came to light in February 2010 when a company was called in to try and satisfy creditors.

Liquidators checked the firm’s accounts, which showed that it was £745,000 in credit on November 19 2009.

But by December 23 of the same year, accounts showed the company was £201,000 in the red.

The company was asked to provide invoices to prove the legitimacy of the expenditure but it is thought the documents eventually provided were false.

Jailing him, judge Penelope Belcher told Gaughan: “The claim that you did not do it for your sole benefit is one I find very hard to believe.”

Referring to the offending, she said: “It was deliberately calculated - significant sums of money - designed to ensure that you and yours were all right when others were not.

“You should have been man enough to face up to the possibility, as many others in this country have to, that you might have been out of work.

“You would still have had your freedom, your honesty, and your ability to work.

“As a result of what you have done, you have lost them.”

Jamie Hamilton, mitigating, handed the judge a large number of character references from friends, family, his current employers and the priest at his local church.

Mr Hamilton described his client as a hard-working family man. He said he was still working in the construction industry and was trusted by his employer.

The barrister said Gaughan had re-established his links with some of the creditors who lost money due to his offending. Mr Hamilton told the court he had given business to some of them but has so far not been in a position to recompense them.