A FINANCE boss from East Lancashire has been banned from being a company director for 10 years following the collapse of a right-to-buy loans firm.

Insolvency investigators have criticised Tony Bennett, 55, of Cherry Drive, Brockhall Village, over the behaviour of himself and two fellow directors of London-based Tarn Insurance Services.

Bennett, along with Stephen Kirby and Stephen Hirst, were the ‘de facto’ directors of Tarn, first incorporated in October 2005.

Loans were made by another company, Euro Holdings Limited Partnership, to people wanting to purchase their own council houses, and Tarn received a fee from each householder, for acting as an intermediary in such deals.

But it later transpired that a substantial proportion of these deals never materalised, leaving around £3.1mllion repayable to Euro, which forced Tarn, based in Southampton Buildings, Holborn Gate, into administration.

An inquiry was also carried out by the Insolvency Service into Tarn’s affairs, which has just released its official findings.

Payments totalling £3.13million were paid out from Tarn to Mr Bennett, Mr Kirby and Mr Hirst, or companies which they controlled, the investigators found.

While Tarn was in business, from October 2006 to November 2007, cash totalling £1.21million was made to the trio, and another £1.91million to companies which they were responsible for.

Administrators determined that Tarn was insolvent from an early point in its trading life, and this situation became worse before it went out of business.

As far back as September 2006, the assets of Tarn were said to have been exceeded by around £263,000 and the problems moun-ted month by month.

An Insolvency Services spokesman said in a final report on Tarn: “The payments to him (Bennett), his co-directors and their companies were made by Tarn out of monies received from its principal funder, and they deprived Tarn of funds to meet its liabilities.”

Under the terms of the director disqualification, which came into force on August 18, Bennett is barred from being involved in the promotion, management or estab-lishment of a limited company.

Lengthy legal battles have also been mounted by Tarn’s administrators in an effort to recoup money from Bennett, Kirby and Hirst.