Greensill scandal cash risk

UP TO £335m of taxpayers’ money could be at risk due to failures by the British Business Bank to properly scrutinise bust lender Greensill Capital, according to a new report.

The Public Accounts Committee of MPs found that the bank, which oversaw the billions lent to businesses during the pandemic in loans backed by the UK Government, failed to conduct sufficient due diligence.

Politicians also questioned why the bank was “insufficiently curious” about reports that suggested Greensill was close to collapse and said checks on the lender were “woefully inadequate”.

The scandal surrounding Greensill has spread throughout Westminster, with allegations that the lender was given preferential treatment.

It emerged former prime minister David Cameron used his position as an adviser to make dozens of calls to Chancellor Rishi Sunak and Treasury officials to secure lending during the pandemic prior to Greensill’s collapse, leading to several investigations.

The committee looked at the role of the British Business Bank and said: “Up to £335m of taxpayer money is at increased risk following the British Business Bank’s failure to conduct sufficient due diligence into Greensill Capital… when it applied to be a lender under the bank’s business support schemes.”

MPs said there was a “lack of information-sharing across government” which hampered decision-making in response to the pandemic, allowing Greensill access to taxpayer-funded schemes.

They also suggested that Greensill may have broken lending rules under the Coronavirus Business Interruption Loan Scheme (CBILS) by loaning £350m to the Gupta Family Group Alliance. It was revealed seven loans of £50m each were handed to different entities of GFG when the rules stated companies should only be entitled to a maximum of £50m per organisation.