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Adult Service’s firm ‘Escorted’ in to Liquidation

Adult Service’s firm ‘Escorted’ in to Liquidation

Two companies which charged advance fees to prospective clients for jobs in adult films or escort services but failed to deliver, have been wound up by the High Court in London on grounds of public interest, following an investigation by the Insolvency Service.

R.C.M.H. Limited (‘RCMH’) and C&W Pictures Limited (‘C&W’) were wound up on 4 September 2013, following petitions from the Secretary of State for Business, Innovation and Skills (BIS).

The investigation found that R.C.M.H. Limited (‘RCMH’) traded as an escort agency using a number of trading styles including ‘Class & Whisper’ and/or ‘Client Connections’. Its newspaper and website adverts offered ‘potential escorts work’.

However, on contacting the company, clients were told they had to pay advance fees to be registered for such introductions. One client paid £40,000 in the expectation of getting escort work with the company’s ‘elite’, ‘VIP’ and ‘aristocrat’ customers. In total RCMH received over of £440,000 into its bank account.

The investigation also found that C&W appeared to have traded under the name ‘Madam Extras’ as a producer of adult films. The company acted in a similar manner to RCMH and placed adverts on its website and in newspapers looking for individuals wishing to appear in adult films.

As was the case with RCMH, people contacting C&W were asked to pay various advance fees in the expectation of obtaining such work and associated earnings and royalties. The fees were variously described as ‘production costs’ and ‘insurance’.

C&W’s bank account received almost £400,000 into itand payments of the same amount were made out of the account between 9 December 2011 to 27 September 2012, over half of which was withdrawn in cash.

Clients of RCMH contacted by the investigators said that the promised work rarely, if ever, materialised and that no refunds were available, while clients of C&W said no work ever materialised and no refunds were given.

In both cases, investigators could not find any records to show the origins and use of the income in the bank accounts, although considerable sums were withdrawn in cash. The companies ensured that contacts were always by phone and no documents or contracts were ever seen by the clients.

Both RCMH and C&W appear to have ceased trading in September 2012 but had not gone into liquidation.

In the absence of adequate accounting records or adequate responses from those involved with the companies, the investigators were unable to fully investigate the companies’ affairs.

The Official Receiver has been appointed liquidator and will now conduct further investigations into both companies.

Company Investigations Supervisor at the Insolvency Service, Geoff Hanna, said:

“The public needs to be on their guard against the activities of companies which encourage people to part with cash on vague promises of work or other services that may well not materialise. People need to do their own diligent research into such companies and examine critically any claims made in adverts and on websites offering introductions and other work. The Insolvency Service will continue to clamp down on companies which deliberately mislead, often quite vulnerable people, in this way.”

About The Author

Mark Hodgson is the Managing Director of Tremark Associates, one of the UK’s leading providers of investigative services. Mark has 30 years experience in private Investigations and the commercial debt recovery industries. He is Vice President of the Association of British Investigators, a member of the World Association of Detectives, The Institute of Credit Management and an associate member of R3 -The Association of Business Recovery Profession.