INVESTIGATION - Poetic licence

IT reseller Desmond Johnson has a succession of failed businesses behind him. His latest venture, Regitech Data Systems, is under investigation by Trading Standards and he owes creditors up to #400,000. But business is just his 'hobby' - poetry is his profession.

When it comes to business, Desmond Johnson, director of Croydon-basedind him. His latest venture, Regitech Data Systems, is under investigation by Trading Standards and he owes creditors up to #400,000. But business is just his 'hobby' - poetry is his profession. Regitech Data Systems Ltd (RDSL), is not poetry in motion. He has a string of dissolved companies behind him, two of which have been forced into compulsory liquidation, and is by his own admission in debt to creditors to the tune of up to #400,000. His current operation is under investigation by the Trading Standards Authority (TSA).

A two-month PC Dealer investigation was sparked by customer outrage over poor supply and delivery of machines. Last month, PC Dealer visited RDSL's premises, to find that while telephones in the office were ringing, staff were lounging about ignoring the tones. Computer shells, components and the boxes they came in littered the floor. Sandip Shah, RDSL customer services manager, told PC Dealer: 'I'm not going to talk to any customers over the phone. We have about 12 machines that are three months late from order. Some customers have instructed their credit card companies not to pay us. We will take those banks to court.'

Almost 100 customers have complained to various TSA offices about the company - all want their machines delivered or their money back. Shah shrugs this off and claims that about a month ago he 'sent out 900 letters to customers (asking what their problems were)'. He adds: 'As soon as I get returns back, I will start dispatching machines.' He says upset customers will get their machines, but one month later, none of the dozens of customers PC Dealer has spoken to has received either the letter or the machines.

RDSL was set up in Trocoll House, in Barking, Essex in January. It shifted to Croydon in August, telling customers it needed 'more room for our expanding business'. Shah now tells PC Dealer a decision on its expansion is on hold. No more machines will be sold by RDSL until customer complaints are solved, then a decision on a fresh direction for the company will be taken. But Shah and Johnson say they are in the process of setting up a new reseller business in RDSL's old Barking offices under the name Infratech. Infratech is not yet registered at Companies House. Shah says he and Johnson plan to sell PCs in exactly the same way as RDSL - just without the problems that RDSL has experienced.

RDSL moved again last week, according to TSA at Croydon, but this time the company appears to have vanished. TSA staff were given a City address by RDSL, but the landlord of the property says no one is moving in this year. The TSA was also told all customer complaints had been solved. It telephoned each of the complainants and found they are still waiting to hear from the company.

When we saw Shah, he did not seem concerned about either the complaints against the company or its debts. 'Regitech does not owe money to anyone - just some debts of #100,000. It's nothing in the world of computing,' he said. Creditors include Karma UK, MegaBytes and Real Times Distributors.

None of these companies are taking action against RDSL.

According to Shah, the possible maximum of #400,000 debt is 'not much' money compared with the total value of the industry.

The debt is also 'insignificant' to his boss Johnson, who describes himself to Companies House as Desmond 'Chubby' Johnson. Now on his 10th company, he told PC Dealer that business is a 'hobby' and that in his opinion, the debts of his failed businesses were small. Johnson says: 'About #30,000 to #40,000 is the maximum debt for any of the companies. Any operation I have ever run has been a tiny, insignificant operation.'

He adds: 'I'm a poet, not a businessman. Business is my hobby, poetry is my profession.' Johnson describes himself as 'poor' and 'struggling', a 'campaigner against racism' and occasional librarian.

He avoids meetings and gives contact phone numbers which don't work.

PC Dealer tried a dozen times to meet with Johnson, from south London, across the east and to north London. We were given three different cellphone numbers by his staff and another three by Johnson. None worked. Johnson also refused to supply a photograph of himself, although his staff have offered to sell one to PC Dealer for #5,000. We declined.

Johnson is facing inquiries from the TSA and the Advertising Standards Authority (ASA) about the way RDSL has been operating in the few short months it has been in existence. He admits to PC Dealer that the company has also been visited by the police, following complaints by customers.

'I have had Trading Standards, I have had CID, I have had many police visits because of our customer services,' he said. No criminal charges have been brought against the company.

When PC Dealer did manage to contact Johnson during this investigation, he blamed the company's difficulties on the IT industry, arguing it promoted 'racism' and conspired to destroy minority business opportunities. He commented: 'The white people of this country must understand that black people in this country who want to get into computers suffer from stumbling blocks of racism.'

Johnson's assumed role as a campaigner for equality spans eight years, back to his first identifiable business - Pucko Shop, which he renamed Multi Ethnic Services. The business was dissolved on 5 July 1994, according to Companies House documents.

Johnson launched into the IT market in the early 90s. Since then, he has had five companies dissolved - Cybernet UK, DCJ Computer Resellers, DCJ Computers, PC Import and Export and Global Internet Consultants. Two other companies of Johnson's - Ultiputer and Computer Distribution - have been forced into compulsory liquidation by creditors. The fate of Johnson's partnership DCJ is unknown because partnerships are not required to file documents open to public search. Many of these companies have judgments against their names at county courts across the country - the most recent was lodged three months ago in Cheltenham, against RDSL, for #1,221.

Johnson aims at the almost bottomless market of users who want a top PC without having to pay top prices. Advertisements for RDSL, currently under investigation by the ASA, boast: 'Save 50 per cent on PCs, components and accessories.'

Johnson says: 'We believe there is a significant market for high-specification, low-price product.'

PC Dealer has spoken to users who have paid up to #1,500 to get a cheap deal on a top line PC. Many want their cash back.

One customer, Stephen Jeanette, told PC Dealer: 'I ordered a #599 system in a full tower case with an additional CD drive. The agreed price was #670.54 inclusive. On 9 July, the company charged my Visa #682.54. After 40 phone calls, six emails and countless conversations with its staff, I finally received a machine 21 days later. There was no extra CD drive, the modem was DOA, there were no speakers, mouse or keyboard and, worst of all, the IBM P266 chip was mounted in a Tekram board which, according to Tekram, can't run this chip.

The machine had been thrown together. When powered up it didn't even boot.

'The company has not returned calls. Now its phones are just ringing out. Needless to say, the machine is being returned tomorrow via courier and my credit card company is pursuing it.'

Another customer upset by the company says: 'The systems are put together in an office in Barking. I have been there and seen them being assembled.

While I was there, three people turned up to complain about systems built by RDSL. One chap had driven from Manchester to Barking because he had been waiting two months for delivery.'

Commenting on RDSL, Johnson says: 'It's had a lot of flak and I think that has been fair. But I haven't done anything major or harmful to anyone. If we fail we fail, but I won't cry. Most of us have not been professional businessmen and we get out of our depth.'

Johnson says he hired Shah to take control of the business because he had realised: 'I can't myself give total commitment to it.' Shah says he has been involved in the IT sales business for the past 10 years.

RDSL advertised on the Asia-based Kwanghwa Market in January. 'Regitech Data Systems Limited Wanted to Buy: Computer Systems and Components. 17in, 19in, 21in Colour Monitors (0.39mm, 0.28mm, 0.26mm).'

Shah told PC Dealer kit was sourced from Taiwan, the US, Europe and the UK: 'Money talks - people don't say no to money.'

One RDSL supplier, Karma UK, says it will now say no to RDSL's money after PC Dealer told it Desmond Johnson was behind the company. Ron Golan, managing director of Karma UK, says the supplier was left #18,000 short by Ultiputer, another company of Johnson's, when it was forced into liquidation a year ago. 'It is his profession - to open companies and close companies.

They open up a company, build up confidence with suppliers, then close it down. The suppliers do not have a trade organisation that watches these serial directors.'

RDSL is being investigated by at least four branches of the TSA. Matthew Golledge, a TSA investigator, says a large number of complaints have been received, mainly about the non-delivery of goods. He says a file on the company is being distributed in the UK and information on Johnson will be passed to a Department of Trade and Industry unit that deals with directors involved in high numbers of dissolved or liquidated companies. Monica Carly, another investigator at the TSA Croydon office, says: 'It seems every second call we get is about Regitech.'

But none of this seems to bother Johnson, who says of himself: 'The bloke keeps trying and we pray he can succeed one day.' He claims he is more interested in literary pursuits: 'I still write full-time. I do poetry residencies at schools and universities, but I have always tried to get involved in business. I just haven't been very successful.'

While Johnson's IT industry 'hobby' is subject to substantial investigation, his poetry appears to enjoy much less scrutiny. Attempts by PC Dealer to obtain copies of his work turned up nothing.

Martin Holroyd, editor of Poetry Monthly, told PC Dealer: 'He certainly is not listed on my database. I can't say I have heard of him. I am not aware of any UK school or university having a poet in residence.'

Despite a track record of business failure and an extensive list of creditors left to pick up the pieces, Johnson refuses to call it a day. He is bullish about the future of his business activities. He says: 'It takes a long time to be like (Yorkshire-based mail-order company) Time - these are the guys we will be pushing in the future.'

IF AT FIRST YOU DON'T SUCCEED

Johnson falls into the quarter of the UK's three million company directors with at least one failed company behind them, according to information service provider Experian (PC Dealer, 1 July).

The law leaves it wide open for directors to set up companies in the wake of one or more failed businesses. They can be disqualified, but it's a complicated process and someone has to foot the bill.

The government has reaffirmed the necessity for companies to file the home addresses of directors and company secretaries at Companies House.

Now that the Trading Standards Authority is passing information to the Companies House compliance agency about Johnson, investigators will discover he has avoided this requirement by using his business addresses.

They will also find that few of the documents legally required by Companies House have been filed for many of Johnson's companies.

Johnson & Co

Dissolved by Companies House

- Cybernet UK

- DCJ Computer Resellers

- DCJ Computers

- PC Import and Export Multi Ethnic Services

Compulsory liquidation

- Ultiputer Computer Distribution

Current

- Regitech Data Systems

- Global Internet Consultants

Status unknown

- DCJ

They were only taking orders

Desmond Johnson and his business manager Sandip Shah blame heavy demand for the problems Regitech Data Systems Ltd is suffering. But they have different views of the volume of demand.

Shah told PC Dealer the business took off after advertisements in computer magazines attracted a massive response: 'We have had no problems, except for a July month when we expected orders of 140 and had orders for 340.'

Johnson remembers differently: 'We had a normal response of three or four computers a week, then after advertising we had 10 to 12 a week.

Then we had a backlog.'

The pair will not suffer a similar problem in new ventures - the magazines they used have told PC Dealer no further ads will be accepted until RDSL pays its bills. They include PC Advisor, PC Direct and Micromart.