I’m no fraudster, says Greensill
LEX Greensill yesterday apologised for the collapse of his company – but denied accusations by MPs that he was a fraudster.
David Cameron’s financier boss said he took full responsibility for the failure of Greensill Capital earlier this year.
Mr Greensill said the supply chain finance firm had been ‘let down’ by its main insurer, Tokio Marine, which did not renew its cover partly because of the impact Covid had on the insurance industry and Greensill’s customers. But he insisted its complex business model had been sound and denied allegations that it was like a ‘Ponzi scheme’ scam. He made his first public comments on the collapse of his firm as it emerged that it is now being probed by the City watchdog.
The Financial Conduct Authority said it was formally investigating the failure of Greensill Capital and a subsidiary firm amid allegations ‘some of which are potentially criminal in nature’. At the start of a threehour evidence session, Mr Greensill told the Commons Treasury committee: ‘Please understand that I bear complete responsibility for the collapse of Greensill Capital.
‘I am desperately saddened that more than 1,000 very hard-working people have lost their jobs at Greensill. Likewise, I take full responsibility for any hardship being felt by our clients and their suppliers, and indeed investors in our programmes.
‘It’s deeply regrettable that we were let down by our leading insurer whose actions assured Greensill’s collapse, and indeed some of our biggest customers. To all of those affected, I am truly sorry.’ Labour MP Rushanara Ali told him bluntly: ‘It is a Ponzi scheme. Frankly, it smacks of fraudulent behaviour. It doesn’t smack of a proper process where people can get supply chain finance which is reliable and credible.’
Mr Greensill said all major financial institutions now offer supply chain finance, which involves paying suppliers early then collecting the money from their customers.
Another Labour MP on the committee, Siobhain McDonagh, asked him: ‘Mr Greensill, are you a fraudster?’ He replied: ‘No, Ms McDonagh, I’m not.’