A gangmaster with a £1m unpaid tax bill was banned from hiring workers after failing to pay staff the minimum wage.

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The Gangmasters Licensing Authority (GLA) stripped recruitment firm SFC Personnel of its licence after it scored three times the number of penalty points needed to ban a gangmaster.

The firm, based in Meridian Way, off Yarmouth Road, Norwich, went into liquidation owing almost £1m to the taxman, according to publicly available records.

The administrator’s report showed SFC owed £999,702 to HMRC, including £589,429 in unpaid VAT, in December.

But a spokesman for administrators P&A Partnership told the EDP the amount the company owed the taxman was yet to be agreed.

The licence-holder was declared “not a fit and proper” person to hold a licence by the GLA after misleading the watchdog about homes rented to workers, which put staff wages below the minimum wage, and failing a “competency test”.

The company hired out around 40 staff to 10 firms.

Paul Cunningham, the GLA’s head of operations in the East of England, said: “This demonstrates the ongoing work of the GLA in this area.

“We are pro-active and will take all necessary steps in order to prevent exploitation of workers.

“If that means closing a company down, so be it.”

GLA officers also found the licence-holder had little knowledge of the company’s finances, breaching a third regulation.

The firm was one of the first in the country to be granted a licence by the GLA, which was set up to curb the exploitation of workers following the Morecambe Bay cockle-picking disaster in which 23 Chinese cockle-pickers died.

A former director of the firm declined to comment.

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