The Long Read: Criminal Bloggers
Equiniti has a small office on a run down industrial estate in Lancing, West Sussex (pictured). Equiniti is where the shareholders register for some two thirds of the FTSE 100 companies are held. So, early this year members of the team booked individual appointments in accordance with s116 of the Companies Act 2006 and set off to Lancing on the dates given to inspect the shareholders registers.
Our ultimate aim was to view the register for not just one company but dozen of companies. When the members of the team arrived on their appointed date, they realised the enormity of the situation. Identifying shareholders was almost impossible. The dataset is so large that finding a specific Local Government Officer was like looking for a needle in a haystack. Take Dr Susan Priest, for instance. Try typing ‘Priest‘ and you’ll be be confronted with a dozen plus matches. Scroll down to ‘S‘ and a good number of Susan’s pop up. Is she one of them? If so, which one? The only way to be sure is cross-check with Priest’s home address which . . . has never been published by Folkestone & Hythe District Council (F&HDC). Home addresses can often be a nightmare to track down, especially if someone has moved house since purchasing or being gifted shares. What’s more, some people’s names don’t appear on the register at all, if they have invested via a so-called ‘nominee service‘, which prevent their details being disclosed.
The upshot of the whole thing is this: it’s very very easy for senior Local Government Officers to hide their financial investments or gifts in big business – if they want to.
What shares does Dr Susan Priest Head of Paid Service for F&HDC have in companies who may or may not have a contract with the Council? Nobody knows for certain, except her and her accountant. Without proper transparency there’s no way of knowing what kind of corruption and wrongdoing might be going on. What scandals have been kept secret over the years?
In the Mears archive members of the team searched through in Lancing, uncovered a worrying example. This is a true story, but we are going to change the name of the senior Local Government Officer. Let’s call them Leslie/Lesley. When the contract for Mears came up due to the previous contractor going out of business, Leslie/Lesley had an influential position, able to quiz the appropriate procurement personnel on its purchasing strategy. Leslie/Lesley knows that Social Housing stock such as those owned by the four Councils of East Kent need maintaining. So after Mears were awarded the contract, Leslie/Lesley made a personal investment in the company. As far as we are aware Leslie/Lesley has never declared it to their respective council/company or the public.
Leslie/Lesley owned shares in the company from 2013 to 2015, while they remained in the senior management of either a local government authority or owned company. Leslie/Lelsey is now a very very senior local government officer and nobody has ever found out about their Mears investment, because the details are hidden away in a grotty little office in Lancing.
The Shepwayvox Team were halfway through writing this when we realised something: We could go to prison for this. No, seriously, we’re not joking!
You might think it in the public interest to reveal potential conflicts of interests of senior Local Government Officers, but we could genuinely be locked up for telling you Leslie’s/Lesley’s real name. Not just Leslie’s/Lesley’s name; it is effectively illegal to publicly name any Local Government Officer or Councillor who has investments in Britain’s biggest, most powerful companies, who may well have contracts with their respective Councils.
Let us explain. For more than 20 years, shareholding registers were completely in the public domain. After paying a nominal fee, anyone could access them and write about them. No questions asked. It was an essential part of corporate transparency. But that all changed in 2006, when the then incumbent Labour Party lead by Tony Blair introduced an obscure clause of an otherwise tedious piece of legislation. It still allows individuals to read the documents privately, like members of the team have done as individuals with Mears and other companies. But quietly and ever so subtly the Act has gagged The Shepwayvox Team and other inquisitive souls.
Buried in the small print of the Companies Act 2006 – section 116, to be exact, lies a critical sentence. Anyone requesting access to a company’s list of shareholders has to first of all provide some information:
‘Name & Address‘ – no issue with that.
‘The purpose for which the information is to be used‘ – Surely that’s our business?
And finally: ‘Whether the information will be disclosed to any other person, and if so. . . his name and address‘ – WTF!
Scio Enim Veritatem = I know the truth.
Excellent Article. As a Local Government Officer such practice although not rife, does happen. I have a senior colleague at our Council who definitely bought into company X before they signed a contract with eight councils on one day. They made a a reasonable profit and there literally was doubles all round.
Being a shareholder in a company which does business with a local authority represents a potential conflict of interest. The Information Commissioner’s Office has produced guidance on Requests for personal data about public sector employees (link below). Of particular interest in this context is paragraph 67. This requires local authorities to maintain registers of e.g. business interests and shareholdings of senior staff to enable them to monitor potential conflicts of interest.
You may wish to enquire of Folkestone & Hythe District Council what registers they have created and what information they are prepared to disclose about their contents.
My ex-partner, a senior Council Officer, purchased shares in a company prior to the Council signing a contract with his council. He made a killing. It allowed us to go on a luxury cruise with the proceeds. At the time I thought nothing of it. He works for a Council in Kent and no doubt is still pulling the same trick.
As an Officer at one of the four which own East Kent Housing, I certainly know of a number of officers who have shares in companies who have contracts with these four councils. They have never declared this information as they must. Nor have they declared how they came by the information they did.
It doesn’t stop there. Oh no! Officers have asked their partners to purchase shares on their behalf. Scio Enim Veritatem = I know the truth. How do we get this issue sorted?
Report your suspicions to the FCA, I suspect there is no point in taking them to your local authority as those responsible for investigating such wrong doing may well be “at it” themselves so you would need to take any investigation of such practice out of their control