Director bannedin charity adverts action

A YORKSHIRE businessman has been banned from being a company director for eight years after a crackdown on publishing companies which claim to be selling adverts to raise money for charity.

Carlo Abbonizio, 37, from Yeadon, was involved in two firms which raised large sums of money through the sale of advert space in their publications, but only donated a fraction of it to the good causes which they claimed to be representing.

The two companies, Yellow Partnership and MPH Direct, both went administration two years ago and were wound up in court last year for failing to comply with the Charities Act and for being involved in aggressive debt recovery.

Now an investigation by the Insolvency Service has resulted in three men, including Mr Abbonizio, being given bans from becoming company directors.

The inquiry found the two firms did not tell customers how much money was being given to charity, “improperly” retained details of customers’ credit cards, including their three-digit security codes – putting them at risk of fraud – and also employed another firm which use aggressive techniques to chase up their debts.

The Insolvency Service found that Yellow Partnership, which was based in Manchester but had a sales operation in Leeds, received at least 958,872 for adverts in its publications over an 11-month period during which it paid less than 50,000 to the good causes it claimed to be supporting.

In the same period from July 1, 2007 to August 31, 2008, investigators found evidence that MPH Direct received at least 444,253 from customers as payment for adverts in publications for registered charities. During this time MPH paid just 18,750 to charity and 53,948 to its directors.

The two firms obtained payments by cold calling small businesses and offering advert space in publications such as a history workbook and a wall planner.

Insolvency Service investigators found the firms did not comply with the Charities Act as they did not inform customers how much money would be paid to charity and did not inform customers of the relationship between the business and the good causes for which they claimed to be raising money.

As a result some customers made payments believing Yellow Partnership was a charity.

The Insolvency Service also found that “improper methods” were used to collect debts on behalf of Yellow Partnership, MPH and a third company with which Mr Abbonizio was not involved with called Strawberry Educational.

Another firm, McEwan Kingston Bailey, was presented to customers as an independent debt collecting agency so people were not aware that it was in fact controlled by the publishing companies it claimed to be merely acting on behalf of.

An Insolvency Service statement said: “They used aggressive techniques including threatening court action; collected or attempted to collect solicitor’s fees and court fees from clients when it had not incurred such costs of around 50 and collected or attempted to collect late payment charges of between 40 and 70 when it was not entitled to make such charges.”

David Anthony Horan of Droylesden, Manchester, and Paul Kristian Percival, of Bideford, North Devon, were also given eight-year bans from being company directors as a result of the Insolvency Service investigation into the four companies.

Comment: Page 12.