DP’s Promotion to Director - dodgy company

[MelonBuffet]

My DP has worked at this company for many years and has just been offered a director role. It’s something he’s wanted for a long time, for the prestige, responsibility and extra money.

My problem is that this company are not hugely respected within their industry, and have been carrying out some seriously dodgy practices - possibly even fraudulent - over recent years. DP has put his concerns about these activities in writing to try to correct things and to protect himself.

He has recently taken advice from a solicitor who apparently said that he has covered himself for these past misdemeanours and wouldn’t be expected to whistle-blow in this circumstance. However I’m not sure he’s giving me the full story, as he wants to stay here so much and he knows I’m against it, so I know he wouldn’t want to tell me if the solicitor had expressed any doubt.

The previous directors are now called CEO, CFO etc so DP’s director title is more in name than an actual legal thing, he isn’t a shareholder etc so not a director as I understood it to be.

If this company continues to act fraudulently (leopards don’t change their spots) as a ‘director’ will DP be implicated in their dodgy dealings and as such, could our home be at risk if the company is taken to court?

Ideally I know he should leave - he was in fact planning to leave when they offered him this promotion to convince him to stay. I cried when he told me he was staying there .

The actual directors are a bunch of narcissists and bullies, cheat on their wives and have treated him pretty shabbily over the years too. I know you get those types everywhere, but I really wish he had left and not stuck with ‘the devil he knows’ for fear of the devil he doesn’t. If he stays, how bad is it?

It really depends what the directorship entails and the contract he signs. If he is very proficient, perhaps now is the time to look for another job.
In the meantime this link might be interesting.
united-kingdom.taylorwessing.com/synapse/duties_personal_liabilities.html

Thanks Faerie, that’s all really useful. I will certainly get him to have his solicitor look over his new contract. I really wish he had taken the other job he was offered, but he is he type who doesn’t like change and was obviously so relieved when he was offered the new role without having to move. I’m gutted.

It is a real directorship? My company has a level of management called ‘Director’ but it is just a grade and not a director in the legal sense.

Whether he is a shareholder or not is completely irrelevant to whether he is a statutory director.

A lot of companies have people called Director of this that and the next thing and that's all it is - a job title. They don't sit on the Board of Directors and don't have any liability.

Taking a broader view though, should the shit hit the fan with dodgy dealings, senior managers will be implicated. Agree with getting contract checked over and looking for another job.

Good link posted above the directors responsibilities.
As per last post, will he be a statutory director? (Recorded with Companies House.)
Also is it a regulated industry? And as such answerable to a statutory body and associated legislation. Many regulators have underpinning legislation which includes criminal liability offences, that should certainly be a consideration.

Whether he is a statutory director is relevant, rather than it just being a job title.

But also, if the company is known in the industry to be dodgy, his personal reputation will suffer by association if he is a director of such a company, and he may struggle to move elsewhere.

It does sound like it’s a grade above his previous manager title, rather than anything more far reaching - almost as a way to convince customers they are speaking to someone with some clout, more than to give him any real say in how the business is run.

But I had read things that said he would still be considered a Director because of his title. I have been director of my own company in the past and I think he was taking my concerns as some kind of “I know better than you” when in fact it was so long ago that I don’t know if things have changed since then? The solicitor (apparently) said otherwise, but I wondered if another opinion would be helpful.

if the company is known in the industry to be dodgy, his personal reputation will suffer by association if he is a director of such a company. Absolutely - another reason I was keen for him to leave.
I will ask him to talk to me before signing anything so that I can share these points, thank you all.

I think you're right to be worried - this story came to mind immediately

www.fnlondon.com/articles/bell-pottinger-partners-face-1m-tax-loss-20171016

Google "companies house beta" and do a search of the company. If he's a director it will say so there.

I find using the Companies House site to be very useful in my job.

Thanks Collaborate. It only happened last week so I don’t think he’ll be on there yet. Will get him to double check. I do think it’s more of an unofficial title than any legal role, but I had read that this could still cause issues if he’s ‘presenting himself’ as a representative of the company.

The thing with that story (thanks for the link Flo) is that it specifically mentions partners, which he won’t be.

It just seems odd that the word partner has apparently changed from meaning something very specific to just another word for senior manager.

Sorry, I mean the word director - confusing myself now!