'Woefully inadequate' checks on Greensill puts £335 million of taxpayers' money at risk
20 November 2021, 00:31
Up to £335 million of taxpayers' money could be at risk due to failures by the British Business Bank, a new report suggests.
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The state owned bank has been accused of "woefully inadequate" due diligence when overseeing the billions lent to businesses during the pandemic.
The Public Accounts Committee of MPs found the bank failed to conduct sufficient due diligence when approving Greensill Capital to make government-backed loans through a coronavirus support scheme.
A report published today reveals that the bank accepted information from the now-collapsed supply-chain finance firm “at face value”, while arguing that the British Business Bank “did not cast its net widely enough in gathering evidence on Greensill”.
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 the lender was given preferential treatment.
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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 £335 million 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."
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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.
The scathing report said the Government's failure to effectively share intelligence on companies approaching it for support, including Greensill, put "taxpayer money at increased risk".
It also stated that the Government and British Business Bank struck the wrong balance between making decisions quickly and protecting taxpayer interests when launching the various lending schemes.
It added: "The bank has been insufficiently curious when identifying where money lent through the schemes, including by Greensill, has ultimately gone."
