Carillion Bosses Face New Inquiry from Insolvency Service

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    According to reports, the former bosses of Carillion were brought in front of the investigators of Insolvency Service at the start of the month to answer some questions regarding the collapse of the company.

    The chairman of the firm when it went bust last mid-January, Philip Green, and Richard Howson, Carillion’s former chief executive, could potentially face bans from taking boardroom positions for a maximum of 15 years, the longest period wherein a company director can be banned from taking a boardroom position.

    Yesterday, Sky News said that the Insolvency Service was talking to hundreds of people as part of its probe into the demise of the firm.

    Howson was the one in charge between the period of 2011 and 2017, however, in July of last year, he stepped down from his position when the firm ran into some serious financial difficulty and the short sellers moved in.

    Carillion is considered the second largest construction company in the United Kingdom when it collapsed. It held 450 government contracts, and placed approximately 45,000 jobs on the line when it went into administration.

    A joint probe that was conducted by the Business, Energy and Industrial Strategy Committee and the Work and Pensions Committee discovered that it had liabilities that amounted to almost £7 billion when it went under, including £2.6 billion in pensions liabilities and £2 billion that is owed to 30,000 suppliers, subcontractors and other short-term creditors.

    The chair of the Work and Pensions Committee, Frank Field, said that Carillion exhibited an “utter contempt” for suppliers, who it utilised as “a line of credit to shore up its fragile balance sheet.”

    The collapse of the firm threw a cloud over the whole sector, with Interserve, a rival outsourcer, repeatedly facing financial difficulty this year that forced its lenders to bail it out at the end of the year.

    The Official Receiver said that it was set to speak to the directors of Carillion “to assist with the investigation.”