Ex finance chief of collapsed Carillion hit with 11-year ban

Carillion

03/07/2023 16:31

By Kirstin Ridley
       LONDON, July 3 (Reuters) - The former finance boss of
Carillion, a British construction services giant that imploded
in 2018, has been banned from holding company directorships for
11 years in a tough censure reserved for severe breaches of
duties, lawyers said.
    Zafar Khan, who stepped down as Carillion's finance director
after just nine months in the job shortly before the business
collapsed in January 2018, had voluntarily agreed to the
disqualification, the Insolvency Service said on Monday.
    The failure of Carillion, whose projects included schools,
hospitals, prisons and part of a high-speed rail link, plunged
thousands of jobs into uncertainty, threatened major public
sector works and raised fresh questions about the risks of
handing public sector projects to private companies.
    Carillion employed 43,000 people before it collapsed in
Britain's biggest bankruptcy in a decade.
    The Insolvency Service applied for eight directors linked to
the business to be disqualified and the Financial Conduct
Authority fined three former executives in 2022, including Khan,
for "recklessly" publishing misleading financial statements.
    The Insolvency Service said Khan caused the company to rely
on false and misleading financial information, was effectively
responsible for misleading market announcements about the
company's 2017 financial performance and for a 54.4 million
pound ($69 million) 2016 dividend that could not be justified.
    Khan did not immediately respond to a request for comment
sent via LinkedIn.
    Litigation is continuing against other directors and a trial
has been set for Oct. 16, the Insolvency Service said.
    "The length of the ban is in the top tier of director
disqualification periods, reserved for only the most severe
breaches of a director's duties, and is well in excess of the
national average length of disqualification (of 7 years and 4
months) for the 2022/23 period," said Ben Drew, a lawyer at
Fladgate.
    ($1 = 0.7881 pounds)

 (Reporting by Kirstin Ridley
Editing by Mark Potter)
 ((kirstin.ridley@thomsonreuters.com; +44 (0) 207 513 5666;))