UK Insolvency Service seeks up to 15-year director ban for Lex Greensill
The UK government has initiated legal action against Lex Greensill, founder of the Greensill financial group, seeking to disqualify him from running companies for up to 15 years. This move follows an investigation into the conduct of directors at Greensill Capital, a firm specializing in supply chain finance, which collapsed in March 2021.
The company facilitated short-term loans for companies to pay suppliers. Despite securing significant funding from banks like Credit Suisse, the firm faced a spectacular downfall. This event also sparked a major lobbying scandal in the UK.
Former Prime Minister David Cameron, who later became Foreign Secretary, reportedly lobbied ministers and officials on behalf of Greensill during the height of the COVID-19 pandemic in 2020. Cameron, who had joined Greensill as an advisor after leaving office, allegedly sent numerous messages advocating for the struggling firm’s inclusion in the government’s coronavirus loan scheme.
The Treasury Select Committee subsequently criticized Cameron’s actions, finding him to have exercised “significant lack of judgment” in his attempts to aid Greensill, a company he was financially invested in. While Cameron maintained his good faith efforts and claimed unawareness of Greensill’s impending collapse until late 2020, the episode cast a shadow on government-business relations.
The Insolvency Service, a government agency, has now taken action against Greensill himself. Citing the Company Directors Disqualification Act of 1986, they seek a court order barring him from holding company director positions for a period of up to 15 years. Court records confirm the disqualification proceedings against him, with the government represented by Howes Percival law firm and Greensill by Ellerman.
Interestingly, the founder has also launched a counter-claim against the Department for Business and Trade, alleging “misuse of private information.” Details of this case remain undisclosed.
The potential disqualification, if successful, would significantly hinder his ability to hold leadership roles in companies for a substantial period. This development comes amidst ongoing investigations into the Greensill Capital collapse and its wider ramifications.
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