All washed out? Rita Rusk, stylist to stars chased by taxman

RITA Rusk, once dubbed Scotland's First Lady of hairdressing and stylist to the stars, yesterday faced the possibility of being pursued for trading while insolvent after running up huge losses and being chased through the courts by the taxman.

Under the name Rita Rusk International she soared from humble beginnings in Glasgow's Castlemilk area to millionaire trendsetter, with celebrity clients including the Duchess of Kent and actress Greta Scacchi.

But after running up more than 200,000 in trading losses in three years, Rusk was forced by HM Revenue and Customs to wind up the company. The Hamilton salon, together with the trading name, has been acquired by local couple Yvonne and Jim Thomson.

Rusk said last night she did not know how much she owed the taxman and denied trading wrongfully. "I have been well advised on that," she said. Rusk and her husband, corporate lawyer Brian Dorman, still have a salon in Glasgow's Great Western Road, which trades as a separate business.

At a creditors' meeting on Friday, interim liquidator Colin Hastings was replaced by Irene Harbottle of WD Robb. According to Mr Hastings' report to the meeting, Rusk, known for her flamboyant style, ran up losses for three years to December 2008 and the company had been insolvent "for many years".

Rita Rusk International's turnover once stood at 1.5 million and financed a luxury lifestyle. But Rusk gave up the lease on the premises in West Nile Street, Glasgow, where Sharleen Spiteri of the pop band Texas had once been a trainee.

Last November, HM Revenue and Customs presented a petition to Glasgow Sheriff Court asking for Rita Rusk International to be wound up and a liquidator appointed. Mr Hastings' report shows the company made combined trading losses for the three years to the end of 2008 of 223,623.

It said "the company was continuously insolvent and that insolvency increased dramatically over the three-year period". He added: "I can confirm that the company has been insolvent for many years prior to the period of review. There are a number of matters which will require to be considered by the liquidator … one of which will be any potential liability of the directors for wrongful trading in terms of the … Insolvency Act 1986.

"This company has been heavily insolvent for many years and the directors should have sought appropriate professional advice … I am unaware whether such advice was sought."

Mr Hastings attributed the financial situation in part to the poor response to one of Rusk's product inventions, the Wire, which works like a brush to create volume in hair but has spirals instead of bristles.

Rusk admitted yesterday that the Wire had lost "a quarter of a million pounds". But she insisted that she and her husband were victims of difficult times and each had lost a fortune. "We are both owed money that we will never see again, but we are trading fine," she said.