The director of a car dealership has been disqualified from running a company until 2027 after scamming members of the public out of nearly £1 million.

Gwyn Merion Roberts, director of Menai Vehicle Solutions Limited, a car dealership in Bangor, North Wales, has been disqualified for 10 years after his company took money from customers but then failed to provide the vehicles that had been paid for. It also failed to pay customers for vehicles sold on their behalf.

Roberts gave an undertaking to the Secretary of State for Business, Energy and Industrial Strategy, which prevents him from becoming directly or indirectly involved in the promotion, formation or management of a company for 10 years, beginning from September 5 2017.

Menai went into liquidation in October 2015 owing at least £1,250,000 to customers and other creditors.

The Insolvency Service’s investigation concluded that Menai operated a practice whereby it sold new vehicles to members of the public for less than the cost incurred by Menai in purchasing them from dealers. This encouraged new custom but inevitably resulted in Menai becoming unable to meet its liabilities, resulting in new customer deposits being used to finance the purchase of vehicles for older customers.

The business model was unsustainable and Menai either failed to provide vehicles to customers after having taken payment for the vehicles or failed to forward funds to customers after selling vehicles on their behalves.

This resulted in losses to at least 40 members of the public totalling at least £969,011.

In several instances, Roberts provided banking documents to customers, showing payments had been instructed to car dealers for the purchase of the vehicle they had ordered, only to subsequently revoke the instruction.

Robert Clarke, chief investigator at the Insolvency Service, said: "This is an unfortunate case in which members of the public suffered significant losses as a consequence of the inexcusable financial practices adopted by Mr Roberts.

"The lengthy period of disqualification is testament to how seriously the Insolvency Service views this misconduct.

"The Insolvency Service will not hesitate to act where members of the public have lost out as a result of malpractice leading to insolvency."