Nozomi restaurant boss throws in the towel at court and gets extended director ban

The Insolvency Service

December 16
16:07 2015

The disqualification follows an investigation by the Insolvency Service and occurred on the second day of a scheduled 7 day High Court trial in November. After legal arguments over the first two days by Mr Georgallides legal counsel had failed, he offered an undertaking to the Secretary of State for Business not to be a director of or be involved in the running of a limited company for 12 years from on 9 December. The undertaking was signed in court and has the same legal effect and force as a court order.

On his disqualification, Mr Georgallides became the second director of the company to face a directorship ban. The Insolvency Service investigation found Eastzest Ltd took over the trading of the Knightsbridge Japanese restaurant, Nozomi, in July 2009 with Marcello Santese as its only recorded director, Georgallides having resigned as a director in March 2009. However, the overwhelming evidence showed he remained in control as a director throughout its trading until liquidation on 8 June 2011.

Mr Georgallides had previously been disqualified as a director for 6 years in February 2010 but retained ownership through various family trusts and remained a signatory to the bank account until March 2011, when the bank discovered his disqualification. During that period, Mr Georgallides signed over 1200 cheques.

At liquidation, the company owed nearly 1.3m to HMRC in relation to arrears of VAT, PAYE and National Insurance Contributions having only paid 111,500 of the debt due during trading. During its trading period, the company issued cheques and direct debit payments which were not met on 1065 occasions with a total value of 1,018,068, incurring 29,700 in bank charges.

The Secretary of State for Business, Innovation and Skills also brought proceedings against Mr Santese, and accepted an undertaking for 5 years from him on 16 November 2015, the day before the trial.

The disqualification means that neither Mr Georgallides nor Mr Santese shall be a director of a company whether directly or indirectly, or be involved in the management of a company in any way for the duration of his disqualification unless he has permission from Court.

Commenting on the disqualification, Mark Bruce, Chief Investigator with the Insolvency Service said:

Mr Georgallides effectively ignored his first disqualification and carried on as the main director of this prestigious restaurant. He must have realised during the trial, that the weight of evidence was heavily against him and threw in the towel.

I was involved in the investigation of his previous companies and Mr Georgallides has a repeated history of non-payment of his various companies crown debts and abuse of the banking facilities. He displays exactly the sort of behaviour that gives some directors a bad name and a 12 year ban reflects how serious the Insolvency Service views his attitude to business.

Mr Georgallides co-director Mr Santese, bears some responsibility for the failure but was clearly the second fiddle and his 5 year disqualification is adequate recompense for the trading public.

Notes to editors

Eastzest Limited (CRO No. 06261252) was incorporated on 29 May 2007 and was placed in creditors voluntary liquidation on 8 June 2011.One of the main purposes of the Company Directors Disqualification Act is to ensure that proper standards of conduct of company directors is maintained and to raise those standards where appropriate.
A disqualification order has the effect that without specific permission of a court, a person with a disqualification cannot:

  • act as a director of a company
  • take part, directly or indirectly, in the promotion, formation or management of a company or limited liability partnership
  • be a receiver of a companys property

In addition that person cannot act as an insolvency practitioner and there are many other restrictions are placed on disqualified directors by other regulations.

Disqualification undertakings are the administrative equivalent of a disqualification order but do not involve court proceedings. Further information on director disqualifications and restrictions is available.

The Insolvency Service administers the insolvency regime, investigating all compulsory liquidations and individual insolvencies (bankruptcies) through the Official Receiver to establish why they became insolvent. It may also use powers under the Companies Act 1985 to conduct confidential fact-finding investigations into the activities of live limited companies in the UK. In addition, the agency authorises and regulates the insolvency profession, deals with disqualification of directors in corporate failures, assesses and pays statutory entitlement to redundancy payments when an employer cannot or will not pay employees, provides banking and investment services for bankruptcy and liquidation estate funds and advises ministers and other government departments on insolvency law and practice.

Further information about the work of the Insolvency Service, and how to complain about financial misconduct, is available.

Contact Press Office

Media enquiries for this press release 020 7674 6910 or 020 7596 6187

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