Insolvency Service Bans Sisters for 7 Years Each Over £67m Creditor Exposure
Two sisters have received a director disqualification ban of seven years each, as reported by the Insolvency Service, after enabling a corporate rescue scheme that undermined the UK’s insolvency framework and left creditors exposed to losses exceeding £67 million.
Karen Mortimer, 67, and Joanna Seawright, 54, were central figures in the Atherton Corporate UK (Ltd) and Atherton Corporate Rescue Limited scheme, which encouraged distressed company directors to transfer ownership rather than enter formal insolvency proceedings.
Between June 2023 and June 2024, Mortimer became the sole director of 138 companies acquired by GPA KLM Ltd. Seawright took control of 31 companies via Summers & May Ltd, all of which were later transferred to GPA KLM Ltd. None of the companies traded post-acquisition, and all were presented as insolvent and asset-free.
However, the Insolvency Service found that Mortimer and Seawright failed to verify the financial positions of the companies they acquired. They did not investigate the location or disposal of over £42 million in assets, relying solely on information provided by Atherton and the former directors.
The companies were left to be struck off or liquidated, with creditors, including HMRC, suppliers, and contractors, bearing the financial fallout.
“We have now reported on a further development, where four more companies linked to the Atherton scheme have been shut down.”
Director Disqualification Undertakings Accepted
The Secretary of State for Business and Trade accepted director disqualification undertakings from both Mortimer and Seawright, effective from 21 October 2025. The bans prevent them from promoting, forming, or managing any company without court permission.
Dave Magrath, Director of Investigation and Enforcement Services at the Insolvency Service, commented:
“Karen Mortimer and Joanna Seawright deliberately frustrated insolvency legislation, playing a vital role in the smooth running of the Atherton scheme… We will not tolerate conduct that undermines this vital framework or that seeks to enable phoenixism.”
Atherton Corporate UK (Ltd) and Atherton Corporate Rescue Limited were shut down in 2024 following investigations. GPA KLM Ltd and Summers & May Ltd were wound up by the High Court at the same time.
Another key enabler of the scheme, Neville Taylor, was banned for nine years in January 2025 after being listed as a director of more than 400 companies.
NDP Commentary by Neil Davies
This case highlights the risks of participating in so-called “rescue” schemes that purport to offer a way out of insolvency without formal proceedings. The disqualifications of Mortimer and Seawright reinforce the principle that directors cannot abdicate their statutory duties, even when acting on referral or instruction.
At NDP, we regularly advise directors who have been approached by third-party firms offering to take over distressed companies. While some arrangements may be legitimate, others, like the Atherton scheme, can expose directors to serious regulatory consequences, including lengthy bans.
The key failing here was the absence of independent due diligence. Directors must not rely solely on assurances from intermediaries or former directors. If a company is insolvent, the duties of directors shift to protecting creditors’ interests. That duty cannot be outsourced.
Contact our Director Disqualification specialists
If you have been approached to participate in a corporate rescue scheme or are concerned about your conduct as a director of a distressed company, speak to us today.
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FAQ: What Is the Atherton Corporate Rescue Scheme?
The Atherton scheme was marketed as a “legal alternative to using insolvency practitioners.” It involved directors of struggling companies paying a fee to Atherton Corporate UK (Ltd) or Atherton Corporate Rescue Limited, then selling their company, often for a nominal sum such as £1, to a third party. The directors were incorrectly told they would have no further responsibility for the company or its debts.
In reality, the scheme allowed assets to be retained or diverted while debts were abandoned, undermining the insolvency regime and exposing creditors to significant losses. The Insolvency Service has since shut down the Atherton companies and disqualified multiple individuals involved.
