{"id":37383,"date":"2020-09-29T14:30:07","date_gmt":"2020-09-29T14:30:07","guid":{"rendered":"https:\/\/www.threatshub.org\/blog\/director-of-nuisance-calls-company-ordered-to-cough-up-114k-after-ignoring-40k-fine-from-uk-data-watchdog\/"},"modified":"2020-09-29T14:30:07","modified_gmt":"2020-09-29T14:30:07","slug":"director-of-nuisance-calls-company-ordered-to-cough-up-114k-after-ignoring-40k-fine-from-uk-data-watchdog","status":"publish","type":"post","link":"https:\/\/www.threatshub.org\/blog\/director-of-nuisance-calls-company-ordered-to-cough-up-114k-after-ignoring-40k-fine-from-uk-data-watchdog\/","title":{"rendered":"Director of nuisance-calls company ordered to cough up \u00a3114k after ignoring \u00a340k fine from UK data watchdog"},"content":{"rendered":"
<\/div>\n

A director of a company fined \u00a340,000 by the Information Commissioner’s Office has himself been ordered to pay out more than \u00a3100,000 as part of a long-running collection saga.<\/p>\n

When the ICO handed IT Protect Ltd a “monetary penalty notice” back in 2017 for making nuisance sales phone calls, it appears few were expecting the chain of events set off by the fine.<\/p>\n

Insolvency and Companies Court Judge Sally Barber ordered Warren Pye to repay a total of \u00a3114,508, revealing in a detailed judgment handed down on 25 September how Bognor Regis-based IT Protect Ltd simply ignored its 2017 fine and continued funnelling cash to its director, his partner, and his brother even after the ICO secured a winding-up order against the firm.<\/p>\n

IT Protect was set up in 2013 by Pye, described by the judge as “a bricklayer who left school at 16”, after his brother Steven Montague “had a good idea for a new business”. Montague’s plan was to buy lists of phone numbers and, ironically, ring them to sell call-blocking devices. He asked Pye to be the new company’s registered director because of his own “bad credit history”.<\/p>\n

People receiving those calls complained \u2013 with many telling the ICO they were registered with the Telephone Preference Service, which is supposed to filter out unsolicited calls. After 157 complaints were registered against IT Protect between April 2015 and May 2016, with 69 of those being ignored when regulators forwarded them to IT Protect, the ICO stepped in and issued its \u00a340,000 fine in January 2017.<\/p>\n

IT Protect appealed against the fine<\/a>, issued under the EU-derived Privacy and Electronic Communications Regulations, and lost. By March 2017 it had ceased trading, though cash continued to flow into its bank account until November. At the end of that month the ICO served a winding-up petition<\/a> against IT Protect, which was successful. The company then entered liquidation.<\/p>\n

“At the date of winding up, the Company had nil known assets and its only creditor was the ICO, owed \u00a340,000,” said Judge Barber, noting that when the winding-up was completed in February 2018 “all [other] creditors of the Company (including employees) had been paid except the ICO”.<\/p>\n

Clawing back the cash<\/span>
\n<\/h3>\n

In an email shown to the court, IT Protect directors \u2013 Pye, Montague, and his sister Dawn \u2013 told the liquidators: “The ICO penalty was not paid due to having to pay other creditors including hmrc and as far as we where [sic]<\/i> concerned this was completely unjust! As all information was sent to them.”<\/p>\n

Meanwhile, \u00a322,240 was withdrawn in cash from IT Protect’s bank account between February and December 2017. Pye was “sole signatory of the Company’s bank account”, as the judge found. A further \u00a341,668.50 was paid out to various other people and companies, including \u00a33,700 on “bakery\/catering equipment” (Dawn Montague worked in “catering”), and \u00a38,682 in “extra salary payments” after IT Protect ceased trading.<\/p>\n

As all this money was flowing out, the ICO’s liquidators were racking up bills. A progress report<\/a> filed with Companies House in May this year revealed accounting firm Mazars LLP had run up costs of \u00a340,050.50 while Chiron Recovery Ltd ran up “time costs” of \u00a345,742.75.<\/p>\n

The total cost of the liquidation between FY2018\/19 and FY2019\/20 was given as \u00a3137,980.95. IT Protect’s \u00a340,000 fine has therefore cost more than three times its value to enforce \u2013 and so far not a penny has been recovered towards the fine.<\/p>\n

In the winding-up report, dated May and covering the period to March 2020, Mazars’ Adam Harris wrote that “the outcome for creditors is currently uncertain and so I am unable to estimate the likely return”. The ICO is an unsecured creditor of IT Protect Ltd.<\/p>\n

Doing the right thing \u2013 at what cost?<\/span>
\n<\/h3>\n

An ICO spokeswoman told The Register<\/i>: “It is important that we rigorously pursue payment of our monetary penalty notices to ensure we protect the public from individuals and companies who repeatedly break the rules. In taking this action we are ensuring that non-compliant directors are disrupted and obstructed from further non-compliance with the legislation.”<\/p>\n

The data regulator declined to answer our questions about who would be paying the bills for the liquidation, though it did point us to its Regulatory Action Policy (PDF<\/a>), which says:<\/p>\n

Warren Pye has been disqualified<\/a> from acting as a company director until 2025. Dawn Montague was found by the High Court not to have acted as a de facto director of IT Protect, in the same case where Pye was ordered to pay \u00a3114,000. Steven Montague, Judge Barber said, “suffered from alcoholism and mental health problems” and was in “too fragile a state to give evidence” to the court.<\/p>\n

While the ICO’s actions are correct \u2013 people who set out to break the law shouldn’t go unpunished or be able to evade the consequences of their actions \u2013 the high cost of pursuing IT Protect may raise eyebrows among fans of strong enforcement. \u00ae<\/p>\n

READ MORE HERE<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

Cost of enforcing IT Protect Ltd’s initial penalty more than treble its value… no money yet collected A director of a company fined \u00a340,000 by the Information Commissioner’s Office has himself been ordered to pay out more than \u00a3100,000 as part of a long-running collection saga.\u2026 READ MORE HERE…<\/p>\n","protected":false},"author":2,"featured_media":37384,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"colormag_page_layout":"default_layout","footnotes":""},"categories":[63],"tags":[],"class_list":["post-37383","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-the-register"],"yoast_head":"\nDirector of nuisance-calls company ordered to cough up \u00a3114k after ignoring \u00a340k fine from UK data watchdog 2026 | ThreatsHub Cybersecurity News<\/title>\n<meta name=\"description\" content=\"ThreatsHub Cybersecurity News | ThreatsHub.org | Cloud Security & Cyber Threats 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