Dickson of Erskine, which has been in business since 1992, has been disqualified from operating indefinitely following a Transport Scotland fraud probe.
Suspicions were aroused in September 2010 while the agency was carrying out a routine audit of reimbursement claims. Bus companies are entitled to claim back from the public purse the cost of all journeys taken by concessionary card holders, who travel for free.
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However, auditors noticed that a single bus pass was being used to generate more than 20 journeys a day, all on routes operated on Dickson of Erskine.
The company operated only two bus services - the number 520 starting and ending at Bishopton train station, and the number 521 starting at Bishopton station and ending at Bridgewater shopping centre, Erskine.
The card was traced to employee Donald Rennie and had been used for 1282 journeys for the firm, generating a reimbursement claim of £17,323.94.
Mr Rennie admitted using the card while on duty and appeared at Paisley Sheriff Court in August last year.
However, Joan Aitken, Traffic Commissioner for Scotland, yesterday criticised company boss Stewart Dickson who, she said, was not open, transparent or co-operative during the Transport Scotland investigation.
She also noted that Mr Dickson had already been called to appear before two public inquiries in Edinburgh, in 2004 and in 2009, after concerns were raised over his vehicles' roadworthiness.
This resulted in a formal warning and a condition being attached to his operating licence in 2009.
In August last year, a government vehicle examiner identified shortcomings in relation to maintenance, record keeping and defect reporting.
In particular, the examiner highlighted the operator's high annual test fail rate which showed that, over the previous two years, eight vehicles had failed a test, none had passed and three were issued with minor repair notices.
Ruling on the case, Miss Aitken said "the successful operation of the [Concessionary Fares] scheme depends on the honesty of operators and their employees".
She added that, while Mr Dickson's failing were "by no means at the worst end of the spectrum of non-compliance", they had "fallen below the standards... required".
She concluded: "I consider that the appropriate period is an indefinite one for that would give Mr Dickson the opportunity to make an application to me at any time to remove the order of disqualification and give evidence to me."