Former Carillion directors face 15-year boardroom bans
The UK Government has launched new legal action against eight former directors of failed contractor Carillion which could see them banned from running businesses for up to 15 years.
Business secretary Kwasi Kwarteng has initiated proceedings against Philip Green (chairman), Richard Howson (chief executive until shortly before the collapse), Keith Cochrane (who took over from Howson), former finance directors Richard Adam and Zafar Khan, and non-executives Andrew Dougal, Alison Horner and Ceri Powell.
Former Weir Group chief executive Keith Cochrane was senior non-executive director for two years eight months up until July 2017 and then interim chief executive for seven months until January 2018.
He is currently chief executive of Schenck Process headquartered in Darmstadt in Germany.
A spokesman for the Insolvency Service said: “We can confirm that the Secretary of State issued company director disqualification proceedings in the public interest against eight directors and former directors of Carillion.”
Anyone subject to disqualification orders could be bound by a range of restrictions including not being allowed to be a director of any UK-registered company or any overseas firm which has connections with the UK.
The filing comes days before the third anniversary of the collapse of Carillion, which caused the loss of thousands of jobs, after which time it would be too late for action to be taken.
A Financial Conduct Authority investigation into the failure has proposed a public censure for the collapsed contractor and has found its directors to have been knowingly reckless in their reporting of the company’s performance.
Unite assistant general secretary Gail Cartmail said: “Carillion’s collapse was not a victimless white-collar crime as thousands of workers lost their jobs. If executives and directors had reported honestly on Carillion’s financial predicament, many of those job losses could have been avoided.
“We would like to see those responsible for the Carillion debacle to be charged and appear in court. Without a doubt Carillion had been trading while insolvent for some time before its collapse.
“The events behind the Carillion collapse demonstrated everything that is wrong with corporate law in the UK; a failure to act before a company collapses and very slow investigations.
“New business secretary Kwasi Kwarteng has injected a much-needed impetus into the Carillion affair, but needs to cast his net wider to clean up the culture of ‘bandit capitalism’ across the UK corporate environment with a strong system of regulation and enforcement.
“Only by taking much more robust action can shareholders, employees, customers and, more widely, the general public be reassured that collapses such as Carillion won’t be repeated. It was a stain on the UK’s corporate reputation.”