Cattles, the stricken doorstep and subprime lender, today cleared out its boardroom and sacked seven senior directors after an investigation into accounting irregularities.

Chief executive David Postings and chairman Norman Broadhurst will leave the company immediately after lawyers finish their probe.

Seven directors — six of whom were suspended in March — have been fired, including finance director James Corr and Ian Cummine, the chief operating officer of Cattles and chairman of its subsidiary Welcome Financial Services.

Mark Collins, treasury & risk director, has also been sacked. Cattles said that none of the ousted directors will receive a pay-off. Another 12 employees — mostly from Welcome — now face disciplinary action.

The crisis, which blew a £700 million hole in its finances, was caused by its bad debts policies being applied incorrectly.

In a breach of corporate governance guidelines, Margaret Young, a non-executive director who previously worked at Credit Suisse, will be executive chairman and replace both Postings and Broadhurst.

Laura Barlow, a chartered accountant at turnaround firm AlixPartners, becomes executive chairman of Welcome. Barlow runs restructuring programmes for businesses in deep financial trouble.

Cattles, which lends to those unable to get mainstream credit, is locked in talks with its creditors. It said last month it has asked for a standstill agreement over a £500 million loan.