Home / News / Europe / David Cameron declares his innocence in the problems of Liberty Steel and GFG Alliance

David Cameron declares his innocence in the problems of Liberty Steel and GFG Alliance

Europe / Business and Finance
1 935

The former UK prime minister sees no violation of the law in his lobbying for bankrupt fintech startup Greensill Capital.

David Cameron declares his innocence in the problems of Liberty Steel and GFG Alliance

The future of Liberty Steel and the GFG Alliance, providing many jobs that could be threatened by the bankruptcy of Greensill Capital, is of concern to former British Prime Minister David Cameron. He also stated that he understands How many questions the public has raised in connection with the fact that he provided advice to Lex Greensilla.

At the end of March, the British lobbyist office of ORCL began investigation into former British Prime Minister David Cameron, according to British media including The Guardian and The Telegraph. He is suspected of violating the rules of lobbying, according to which every person engaged in such activities must register in the register of lobbyist consultants, which Mr. Cameron did not do. ORCL responded to media inquiries that “the registry is investigating whether David Cameron was involved in illegal lobbying activities.

However, the ex-prime minister himself said that all his activities with Greensill did not violate the laws. “It is important to understand that I was not on the board of directors of Greensill Capital, nor was I a member of the risk assessment and credit policy committee. I didn’t play any role in making decisions on loans, ”said David Cameron. At the same time, the former politician said that “it is important to draw lessons from this situation. As a former prime minister, I admit that my communications with the government should have been done only through the most formal channels - so that later there would be no misunderstandings. ”

Recall that Greensill Capital was created in 2011 by a native of Australia Lex Greensill. His idea of ​​financial intermediation was to finance supply chains, when, after shipment, the seller received payment immediately, and the buyer settled with Greensill with a deferred payment. At the same time, Greensill itself was insured against possible losses in the event of a client's refusal to pay the bills. The insurer was the Australian Bond & Credit Company, which first belonged to Insurance Australia Group, and then was bought out by Tokio Marine Holdings.

At first, Greensill Capital suffered serious losses, but in 2017 everything changed dramatically. The unexpected take-off of Greensill was facilitated by the Indian billionaire Sanjeev Gupta, who has put together a business buying up metallurgical assets. Lex Greensill helped Mr. Gupta open an account in the Swiss investment fund GAM Holdings - for 50 million pounds. The name of the account holder was never disclosed, and the money received to him was anonymously sent to the accounts of Mr. Gupta's companies, which are part of the GFG Alliance group of companies.

Investors who rushed to invest their money in a new financial instrument from Greensill preferred not to notice the pitfalls in the company's activities. For example, the fact that Greensill's activities were barely reflected in the financial statements of its clients, who preferred not to disclose details of transactions with a fintech startup. Greensill's troubles began in the summer of 2020, when Bond & Credit Company, after conducting an internal audit, decided not to renew Greensill's loan insurance. At the same time, German financial regulator BaFin launched its own investigation into the startup's banking division in Bremen. Soon, the regulator found out that most of the assets of Mr. Greensill's bank were connected with the assets of Sanjeev Gupta and that the bank systematically manipulated its financial statements.

This was followed by a statement by Credit Suisse to freeze funds through which Greensill sold its financial instruments to investors. Simply because now they were insured, and the agreement between the Swiss bank and its clients stipulated that Greensill had insurance. Sanjeev Gupta's GFG Alliance notified the startup that without additional lending, it would be forced to declare bankruptcy. Simply because Mr. Gupta's entire empire was tied to lending from Greensill, which was carefully hidden through the metallurgical giant's supply chain financing schemes.

Upon learning of the impending bankruptcy of the GFG Alliance, Credit Suisse demanded that Greensill repay the loan for $ 140 million ahead of schedule, to which the fintech startup refused. And already in early March, Greensill filed for bankruptcy in the courts of Australia and the UK. Lex Greensill said goodbye to his employees, and his startup was transferred to

Add a comment
Сomments (0)
To comment
Войти с ВК Войти с ФБ Войти с Яндекс
Sign in with:
Войти с ВК Войти с ФБ Войти с Яндекс