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A limited company is a firewall through which debt can't pass. How is what he did any more unethical than any other limited company?

(Or are you implying that limited companies are in principle unethical?)

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It's just that it generally doesn't work this way, the moral hazard would be insane. Lenders are smart enough to have debt personally guaranteed by someone at the corporation when the company has no assets of its own to use as collateral.

Maybe debt firewalls (i.e. limited companies) should be two-way, i.e. if a limited compan doesn't have to pay its debts, nor do its debtors.

I don't see how anyone could disagree with this on fairness grounds. I'm not sure whether it would have good or bad economic effects.

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