The boss of a Manchester spare parts company has been disqualified after he spent money from company's bank account using funds that were dishonestly obtained.

Modussur Khan, 32, from Oldham, was the sole director of Manchester Autospares (MAL) throughout the life of the company. The company was incorporated in December 2011 and sold scrap parts for the motor industry from premises in Failsworth, Manchester.

The company ceased trading on May 3, 2016, and went into liquidation on May 18, 2016, owing creditors £61,374.

An Insolvency Service investigation, which followed the company’s liquidation, found that MAL operated a merchant services account whereby it received card payments from customers.

However, the company took unauthorised payments from customers’ cards between April 5 and April 25 2016 totalling at least £72,887. The payments were not related to genuine purchases and led to increased receipts into the company’s bank account.

Then between April 8 and April 22 2016, the company made payments totalling at least £71,816 from its bank account using the fraudulently obtained funds, which Khan used to make personal purchases, a bureau de change withdrawal and other cash withdrawals.

Furthermore, MAL’s customers applied for refunds to the merchant services provider as they had not authorised payments to MAL. This led the merchant services provider to suffer a total loss of £56,791.

On May 31, the Secretary of State accepted a disqualification undertaking from Modussur Khan, in which he did not dispute making payments of £71,816 from the company’s bank account when he knew or ought to have known that at least some of these funds were obtained fraudulently.

His disqualification became effective from June 21 and lasts for 12 years, where he is banned from directly or indirectly becoming involved in the management of a company without the permission of the court.

Robert Clarke, group leader of Insolvent Investigations North at The Insolvency Service, said: "This is a serious case of misconduct by the director. The disqualification of Modussur Khan sends out a clear message that where a corporate vehicle is used to facilitate actual or potential fraudulent activity, action will be taken to remove the directors from the corporate arena for a lengthy period of time."