The Insolvency Service spent £11 million seeking director disqualifications against eight former Carillion directors, of whom only three have received bans.
The government agency has accrued costs in its disqualification proceedings against eight former directors of the collapsed contractor, Business Minister Kevin Hollinrake revealed on Tuesday (24 October). It recovered £2.7m after three former executives were successfully disqualified.
However, the Insolvency Service dropped legal action against five former non-executive directors, including chairman Philip Green (pictured) and Keith Cochrane on October 13, three days before the trial was due to start .
The Insolvency Service therefore spent £8.3m on the three successful disqualifications, and the public purse increased by almost £2.8m per ban.
A spokesman for the Insolvency Service said: “The costs of bringing this case were constantly reviewed to ensure that they were at all times appropriate and proportionate.
“As soon as it was determined that continuing the proceedings against the five non-executive directors was no longer in the public interest, we acted to close the case.”
Richard Howson, Carillion’s chief executive from 2011 to 2017, was disqualified from being a director for eight years in October. Former finance directors Richard Adam and Zafar Khan were banned for 12-and-a-half years and 11 years respectively in July, after the Insolvency Service found each had caused the company to rely on “false and misleading financial information” to prepare certain accounts.
The National Audit Office estimated in 2018 that Carillion’s liquidation would cost the UK taxpayer £148m, although it stressed that the actual figure would take years to establish.
The then business secretary Kwasi Kwarteng initiated legal proceedings against the eight former directors “in the public interest” in early 2018.
