10 QUESTIONS GREEN MUST ANSWER TODAY
SiR PHiLiP GReeN confirmed yesterday he will face MPs at a joint hearing of the House of Commons Business and Work and Pensions Committees today. Here are the key questions he must answer on the collapse of BHS.
1 WHAT checks did you make on the background of notorious three-times bankrupt Dominic Chappell, who bought the company for £1 even though he had no retail experience? 2 WHY did you sell BHS last year when it was clear there was a giant hole in the company’s pension scheme, which was once in profit? 3 HOW much are you now prepared to contribute to help eliminate the £571 million black hole? 4 DO YOU think it is morally right that you and your wife, Tina, took out hundreds of million of pounds from BHS in the form of dividends, rent, fees and loan interest while starving the chain of investment? 5 DO YOU think it is morally right that your wife, Tina, who technically owns your empire, lives in the tax haven of Monte Carlo, where she pays no tax on its earnings? 6 WILL you now waive the £35 million debt which BHS still owes your company, Arcadia? 7 DID you leave this £35 million debt in place as a way of retaining a form of control over the company even after selling it? 8 DID you really block Mike Ashley, boss of the Sports Direct chain, from saving BHS? If so, was it because of personal animosity towards him? 9 HOW much money did your wife, Tina, make when your company, Arcadia, bought the headquarters of BHS from her? 10 DOES your conduct befit a knight of the realm?
FROM PREVIOUS PAGE she would then, in theory, retain almost all of their joint assets.
However, the tycoon, a committed family man, regards the prospect of such a development as being so remote as to be beyond the bounds of possibility, and has previously joked: ‘I can’t afford to divorce her!’
The business structure, which is perfectly legal, also means that many of the hundreds of millions of pounds that were extracted from BHS during their tenure were also kept out of our Exchequer’s hands. These include around £414 million in dividend payments, plus £252 million in ‘management charges’ paid to Arcadia in return for accounting and other services, and £141 million in ‘ground rent’ for stores and offices, whose ownership had been hived off into different companies in the Green empire.
Then there is another £21 million netted at a profit through a complex property deal that saw the BHS head office sold first to a Virgin Islands-based firm Lady Green controls, before being then sold back to Arcadia.
To critics, the tax efficient payments represent a form of assetstripping: taking vast amounts of cash from a failing company — to the eventual cost of the staff, pensioners and any businesses owed money by the firm. Green will strongly dispute such a charge, just as he seems set to deny responsibility for the state of the investment fund underpinning the BHS pension scheme, which was in surplus when he first bought the company but had a black hole of £450 million by the time he offloaded it, and now has a shortfall of £571 million.
Meanwhile, Lady Green’s role in this rum tale may also be probed by MPs.
According to Frank Field, the Work and Pension’s Committee’s chairman, Lady Green has so far managed to avoid being called to give evidence to MPs because Sir Philip has assured him that ‘there is nothing she knows that he doesn’t’, and that ‘the guy who called all the shots with the business is Sir Philip himself’.
However, before the BHS scandal broke, Lady Green appears to have played a strangely different tune.
In one previous interview, she said her husband ‘does nothing without consulting me’. In another, she has claimed: ‘I’m not just stuck in Monaco. I’m involved in his life and I know what’s going on.’
Her real role in both Sir Philip’s life and his business affairs stretches back to 1985, when they first met at San Lorenzo, a famous Italian restaurant in London’s Knightsbridge that was then a favourite haunt of Prince Diana.
Tina was married at the time to her first husband Robert Palos, a South African businessman who died in 2010. They had two children, which gives some clue as to her exact age (previous interviewers have been banned from asking, though she is believed to be in her seventh decade).
At their first meeting, she found Green to be ‘dreadful’ and ‘an arrogant man’ because he declared that he’d never heard of a boutique she then ran.
However, the following night they ran into each other at a mutual friend’s drinks party.
‘His bow-tie was crooked and without thinking I went up to him and straightened it, and that was it,’ she once recalled. ‘It was the oddest thing. I thought “I’m in trouble here.” I just fell in love with him that moment.’
By 1989, Tina was divorced and had moved into Philip’s mansion on The Bishop’s Avenue in Hampstead, the road known as ‘Billionaire’s Row’ with her children Stasha, who is now an artist, and Brett, who now works for Taveta, one of Green’s investment companies, and will himself give evidence to MPs next week. In 1991, they married, going on to have two children: daughter Chole, 25, an occasional star of the TV show Made In Chelsea (who previously dated singer Jennifer Lopez’s ex-husband Marc Anthony), and son Brandon, 23, who is primarily known for enjoying a £4 million bar mitzvah at the Grand-Hotel du Cap-Ferrat in 2005 at which the opera singer Andrea Bocelli — and superstar Beyoncé — provided the entertainment.
Tina’s decision to move to Monaco seven years later came after two life-changing incidents.
One saw Sir Philip suffer a heart attack (‘he was lucky,’ she once recalled, ‘he got the right drugs in time’) and another in which he was mugged on the street near their home by a man carrying a sword.
‘I just thought, “What are we doing here?” I wanted a new life, a nice life,’ she has said.
And so to Monaco, famously described by the writer Somerset Maugham as a ‘sunny place for shady people’, where the couple found themselves at home.
With Sir Philip commuting to London via private jet, Lady Green threw herself into the social circuit.
By way of a day job, she has Green & Mingarelli, a Monacobased company she set up with the Italian architect Pietro Mingarelli four years ago to help fit out the interiors of luxury yachts, high-end properties, private jets and helicopters.
Recently, the firm’s attentions have focused on the Lionheart. To that end, the yacht is due to sail at the end of this week.
There was, apparently, a plan for it to launch last week, but it was cancelled, as it was thought to be untenable public relations for the Greens to be seen picking it up at this stage.
It is, though, fully crewed, with enough fresh food, flowers and booze on board for a monthlong jolly.
It will finally be met by Sir Philip and Lady Green in Malta on June 23, which — since it is the day of the EU referendum — happens to be what PR advisers might call a good day to bury bad news.
Sir Philip is in private very defensive about his yacht habit, and is angry that it has been ‘dragged into’ the row over the collapse of BHS; he contends that it is ‘entirely irrelevant’.
‘Philip is convinced that once the truth about BHS is out, they’ll be fine. So they will keep a fairly low profile in Malta for a few weeks and he says that after that, “people will be talking about something else,” ’ says a friend.
‘Tina has said that the “real story” will shock everyone and people will realise that Philip is actually a “hero” who has poured millions of his own money into BHS trying to save it.’
Let’s hope they are right — otherwise the owner of Europe’s latest super-yacht may not be entitled to call herself ‘Lady Green’ for very much longer.
‘He does nothing without talking to me,’ she said