Monday 23rd Apr 2018 - Logistics Manager

Haulage boss banned after using red diesel

The director of a Scottish freight transport firm has been banned from acting as a director for nine years after he illegally used red diesel to fuel his fleet.

Scott McClung was the sole director of SDS Logistics (Bonnybridge) Limited, which went into liquidation in August 2016 owing some £1.9 million.

An investigation by the Insolvency Service following the liquidation found that between May 2014 and April 2017, SDS Logistics used almost 1.7 million litres of red diesel in its road vehicles.

Red diesel is taxed at a lower rate that normal fuel but can only used for non-road applications such as farming or construction. It is illegal to use it in vehicles registered for and used on public roads.

SDS Logistics’ misuse of the fuel was first detected in April 2016 when HMRC officials found four vehicles had been filled with red diesel.

HMRC levied an excise duty of £790,456 and a penalty of £553,210 but SDS Logistics failed to pay, leading to its liquidation.

Robert Clarke, investigations group leader at the Insolvency Service, said: “The substantial period of this disqualification reflects the fact this director put his financial interests above all else in taking advantage of this subsidised fuel. The majority of similar businesses pay the proper duty on the fuel they use, and carry that legitimate cost within their trading strategy.”