More than 1,000 company directors disqualified last year

In a stark warning to UK boardrooms: a newly released government report has revealed that over 1,000 company directors were disqualified in the last financial year.

The Insolvency Service’s latest annual enforcement figures show that, between 2024-25, 1,036 people were banned from being a company director. The majority of cases, 736, were due to COVID loan abuse. 

In this article, we’ll dig deeper into the findings and outline what it means to be disqualified. 

From boardroom to ban

Company directors are legally responsible for overseeing the operations of a limited company and ensuring compliance with all relevant legal obligations. Directors act on behalf of shareholders, holding full accountability for a company’s performance.

According to the latest figures from the Insolvency Service, 1,036 directors were disqualified in 2024-25, highlighting a significant crackdown on misconduct. Of those disqualified, 736 were found guilty of abusing COVID Bounce Back loans.

The Bounce Back Loan Scheme was introduced to help SMEs survive the pandemic by providing low-interest loans between £2,000 and £50,000. However, the scheme came with strict conditions:

• Loans to be repaid within 10 years, with the first payment due at 12 months
• Directors could not dissolve their companies to avoid repayment
• The loans could not be used for personal expenses

Sadly, many directors took advantage of the system, leading to their disqualification.

What happens if you’re disqualified?

As a company director, you can be disqualified if you don’t meet the legal obligations of running your business.

Disqualification is essentially a ban. You won’t be able to be involved in another company’s formation, promotion, and management until the ban is lifted.

The penalties can remain in place for up to 15 years – although the Insolvency Service’s report states that the average length ban was eight years. 

It can happen to anyone. Television personality and adventurer Ant Middleton was recently banned as a director after his company failed to pay more than £1m in tax.

In severe cases, you may also receive a criminal conviction if found guilty of committing loan fraud. That’s what happened to Mehmet Akyuz, the owner of a Sussex cafe.

Akyuz fraudulently applied for three Bounce Back Loans, totalling £150,000, for his dormant businesses. Despite not trading, Akyuz received the loans and was later convicted of fraud by false representation following an investigation by the Insolvency Service.

How else can you be disqualified from being a director?

Along with misusing COVID loans, you can be disqualified as a company director if your conduct is deemed to be ‘unfit’. That could involve:

• Continuing business operations when you can’t pay your debts
• Failing to maintain proper accounting records
• Not sending accounts and returns to Companies House
• Paying tax incorrectly
• Misusing company money or assets, such as for personal use
• Breaching prior disqualification terms

UK company directors should heed the latest Insolvency Service’s report as a warning to ensure they follow the rulebook to the letter.

Dave Magrath, Director of Investigation and Enforcement Services at the Insolvency Service, says the new figures are “a reminder to all businesses to operate appropriately, within the law, and help to protect the public from rogue business and their directors.”