Two rogue timeshare claims specialists have been shut down for failing to deliver advertised services following court action by the Insolvency Service.
Chester-based Meredith Pritchard Claims Consultants (MPCC) and First Law Solutions (FLS) were wound-up at the High Court in Manchester.
The Official Receiver has been appointed liquidator of the companies.
The court heard that MPCC and FLS offered timeshare claims management services, helping clients get out of their existing timeshare contracts and pursue compensation claims against providers.
MPCC traded between October 2016 and August 2017, before FLS continued MPCC’s activities.
Investigators carrying out confidential enquiries found that between the two companies approximately 113 clients had typically paid either £1,950 or £5,950 dependent on the services being purchased.
In return, customers expected that lawyers based abroad would be instructed on their behalf to relinquish their timeshare and in some cases seek compensation.
But investigators established that while lawyers may have been instructed in some cases, MPCC and FLS were unable to demonstrate any significant evidence of clients having their contracts relinquished or of compensation being paid.
Investigators also discovered that MPCC received income of more than £440,000 and that FLS received £110,000.
Despite this, investigators were unable to identify any payments made by MPCC to overseas lawyers, while FLS only made payments to overseas lawyers totalling £13,000 during the period of the investigation.
The Insolvency Service presented petitions to the court on the grounds that both companies traded with a lack of commercial probity by failing to provide contracted services in a timely manner or at all.
This included accepting payments in respect of non-viable claims, charging excessive fees, and using misleading and aggressive sales techniques.
It was also alleged that MPCC and FLS did not maintain, preserve and/or deliver up full accounting records and that they were remiss in complying with statutory obligations to file annual accounts and confirmation statements.
In the case of MPCC only, it was alleged that the director had failed to fully co-operate with the investigation.
Insolvency Service chief investigator David Hope said: “People genuinely sought out these companies for help to get them out of difficult situations concerning their timeshares.
“However, many customers did not receive the services they were led to expect, despite paying over significant fees.
“Securing winding-up orders through the courts will protect any more people from being duped by MPCC and FLS and the Insolvency Service will continue to protect consumers by closing down rogue companies that operate in this way.”