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Carillion: Legal bid launched to ban former directors

Carillion: Legal bid launched to ban former directors
Business
Action brought by the new business secretary could see eight ex-directors banned from taking up senior management roles for up to 15 years.

Kwasi Kwarteng launched the legal proceedings "in the public interest", the Insolvency Service said.

The move comes three years after Carillion crashed into administration.

Carillion was wound up in January 2018, and the Official Receiver submitted a report about the conduct of each director.

Thousands of jobs were lost following the collapse of the construction giant, which was one of the biggest corporate failures in the UK.

Mr Kwarteng has decided it would be in the public interest for a court to make an order disqualifying the directors on the grounds of their conduct.

A spokesperson for the Insolvency Service, which handles corporate collapses, said: "We can confirm that on 12 January the Secretary of State issued company director disqualification proceedings in the public interest against eight directors and former directors of Carillion."

image captionKwasi Kwarteng recently succeeded Alok Sharma as Business Secretary

The court proceedings name eight individuals, including former chairman Philip Green, former chief executive Richard Howson and ex-company director Keith Cochrane, who led the firm in the final months before its collapse.

Two ex-finance directors and three boardroom non-executives are also named.They could be banned for between two and 15 years from being directors of firms based in the UK, or from forming or promoting a company in the UK or with connections to it.

Around the time of the Carillion s collapse, unions led criticism of the company s executives and auditors, and of the handling of public sector contracts by private companies.

found its business model had been defined by a "relentless dash for cash, driven by acquisitions, rising debt, expansion into new markets and exploitation of suppliers".

When it was liquidated with debts of £1.5bn in January 2018 , the firm had about 420 UK public sector contracts, according to the National Audit Office.

Almost all services provided by Carillion, which also included providing school meals and maintaining prisons, continued uninterrupted after the firm s collapse, although work on some construction projects stopped.
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