Banks’ advice to Carillion probed
THE role of heavyweight City banks and law firms in the collapse of Carillion has come under scrutiny by MPs investigating the construction giant’s demise.
Parliament’s Business and Pensions Committees have written to investment banking giants Morgan Stanley and Lazard, as well as Magic Circle law firm Slaughter & May, as part of their current joint inquiry into the debacle.
The Square Mile companies have been asked to provide information regarding advice they gave to Carillion executives before its collapse in January, and detail fees that were received.
MPs Frank Field and Rachel Reeves, who are leading the inquiry, have also asked if the fees charged were “contingent on certain outcomes” and if their advice was acted upon.
Last week the Belfast Telegraph revealed French energy giant Engie is the frontrunner to take on the Northern Ireland Housing Executive contracts following the collapse of Carillion.
Carillion employs around 500 staff here, with 230 of those working for the NIHE.
Its collapse left in its wake a £900m debt pile, a £590m pension deficit, and hundreds of millions of pounds in unfinished public contracts.
The investigation of banks and law firms comes after Britain’s big four accountancy firms were savaged by the MPs, who accused them of “feasting on the carcass” of Carillion and collecting more than £70m in the process.
In a breakdown of fees collected by KPMG, PwC, Deloitte and EY, the committees claimed that the professional services firms pocketed a total of £71.6m in Carillion-related work over 10 years.