The taxman and small businesses face losing out on millions of pounds after clothing retailer Blue Inc used a controversial insolvency procedure to close loss-making stores.
HMRC could lose £3m and suppliers £31.6m after Blue Inc, which also owns the Officers Club, used a pre-pack administration to get rid of 76 stores and cut 500 jobs.
The store closures represent roughly a third of Blue Incs estate and the retailer, which used to be chaired by former M&S boss Sir Stuart Rose, can now rebuild without its debts.
Blue Inc placed the subsidiary that owned and operated the sores leases into administration and then immediately bought back the healthiest parts of the business.
New documents filed by Leonard Curtis, the administrator, sh…