Yet another Manchester publishing company closed down

Who is behind this multi-million pound operation?

Costello Limited, based in Trafford Park, Manchester carried on business nationally selling advertising space in publications and on websites purporting to promote awareness in child safety, road safety and crime prevention.

There are at least a dozen of these companies wound up every year - all centred around Manchester and Lancashire. 

The enquiry, by the Insolvency Service’s Companies Investigation Branch (CIB) found that, between February 2008 and July 2009 the company achieved income in excess of £600,000, from cold-calling potential advertisers, usually small businesses, and offering them advertising space based on misleading representations. Alleged misconduct included;

·        Issuing invoices when it knew, or ought to have known, that its advertising services were not wanted

·        Acting with the intention of misleading customers into believing that a legitimate advert had been placed

·        Refusing to allow customers to cancel an advert and;

·        Falsely claiming that part of the monies paid by customers would be used to make charitable donations

The enquiry also found that there was little or no of commercial benefit to customers from placing adverts in the publications and that there was no evidence to support claimed distribution figures. Additionally, the company pursued its customers for payment in an aggressive, threatening and intimidating manner in circumstances when it knew or ought to have known that the a significant number of advertisers either did not want the advert or had not requested it.

 CIB Investigations Supervisor Alex Deane said;

“This case serves as another reminder to businesses to be wary of anyone who cold-calls asking potential customers to place advertisements in wall-planners, diaries, children’s fun books and similar publications. Anyone who has any doubts or feels that they are being intimidated into paying for such unsolicited or unwanted advertising should consult the Insolvency Service website http://www.insolvency.gov.uk and follow the link to Companies Investigation Branch where there are more details concerning this type of publishing scam” .