Deep Purple accountant rocked by ban
The former accountant of legendary rock band Deep Purple has been banned from serving as a director for 11 years by the Insolvency Service.
An investigation found that Dipak Rao, who acted as Deep Purple’s accountant for more than 20 years, misappropriated at least £2m from companies responsible for controlling the copyright for many of the band’s hits.
The Insolvency Service discovered that between 2008 and 2014 Rao had made numerous payments from Deep Purple (Overseas) Ltd and HEC Enterprises Ltd into his personal accounts.
Rao hid these transactions by excluding them from the financial accounts and restricting access to the companies’ bank statements.
Both entities were established in the 1970s to manage the copyright of the band’s hits, but also became responsible for the rights of Rainbow and Whitesnake, bands formed by former Deep Purple members Ritchie Blackmore and David Coverdale.
Rao admitted to “borrowing” at least £2.27m, but according to the Insolvency Service only £477,000 has so far been recovered. He resigned as director of both firms in November 2014, and in early 2016 they both went into administration.
His scheme came to light when Richie Blackmore, the band's former guitarist, launched a lawsuit against the group's management companies last year, demanding £750,000 in unpaid royalties.
After concluding their investigation, which an insider told the Guardian was ‘as clear as it was damning’, Rao has been disqualified from managing or controlling a company without leave of the court until 2028.
“Rao misappropriated company funds,” said Insolvency Service chief investigator Sue Macleod, “causing detriment to the company and its creditors, to his own personal benefit.”
“Company directors should note from this enforcement result that actions of this kind will lead to serious censure.
“This disqualification is a reminder to others tempted to do the same that the Insolvency Service will rigorously pursue enforcement action and seek to remove from them for a lengthy period.”
In an ongoing case separate to the Insolvency Service investigation the Times reported in January that several members of the band, including lead singer, Ian Gillan, are suing Rao in the high court for a reported £4m over his management of their financial affairs.
Deep Purple’s relationship with Rao is far removed from their former accountant, the late Bill Reid. According to Gillan’s 1998 autobiography, the band’s first accountant was “an anchor” for the band, after they found him by marching into the reception of a “major London firm” and demanding to see one of their partners.