{"id":482089,"date":"2023-07-03T17:55:25","date_gmt":"2023-07-03T16:55:25","guid":{"rendered":"https:\/\/www.constructionnews.co.uk\/?p=482089"},"modified":"2023-07-03T17:55:25","modified_gmt":"2023-07-03T16:55:25","slug":"former-carillion-boss-banned-from-being-a-director-for-11-years","status":"publish","type":"post","link":"https:\/\/www.constructionnews.co.uk\/contractors\/carillion\/former-carillion-boss-banned-from-being-a-director-for-11-years-03-07-2023\/","title":{"rendered":"Former Carillion boss banned from being a director for 11 years"},"content":{"rendered":"
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Carillion’s former finance director, Zafar Khan, has been disqualified as a director for 11 years.<\/p>\n<\/div>\n<\/div>\n

According to the Insolvency Service, which is overseeing the liquidation of Carillion, Khan caused the contractor to rely on “false and misleading financial information for the preparation of consolidated financial statements for 2016”.<\/p>\n

The 2016 statement misstated profits in relation to the performance of five major construction contracts: Royal Liverpool University Hospital, Battersea Power Station, Aberdeen Western Peripheral Route, Midlands Metropolitan Hospital and Msheireb Phase 1B, in Qatar.<\/p>\n

The Insolvency Service said: “The quantum of the misstatement is assessed as at least \u00a3208.5m, together with an adjusted year end loss of, at least, \u00a3(61.7m) in contrast to [Carillion] PLC\u2019s reported profit before tax of \u00a3146.7m.”<\/p>\n

\u201cThe Insolvency Service, acting on behalf of the secretary of state for business and trade, has accepted a disqualification undertaking from Zafar Iqbal Khan for 11 years for his conduct as a director of Carillion.<\/p>\n

In 2021,<\/a> the Insolvency Service launched legal action to ban eight of the collapsed contractor’s directors, including Khan. Court cases for the other seven directors are due to take place in October, although any of the remaining directors could take voluntary disqualification undertakings before then.<\/p>\n

The Insolvency Service declined to comment on whether it was negotiating voluntary arrangements with any other former Carillion directors.<\/p>\n

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Last year<\/a> three former Carillion directors, including Khan, were fined nearly \u00a3900,000 by the Financial Conduct Authority for \u201crecklessly\u201d publishing misleading accounts \u2013 although all three directors appealed the fines, with the appeals yet to be heard in a tribunal.<\/p>\n

Three of Carillion\u2019s financial statements \u2013 published on 7 December 2016, 1 March 2017 and 3 May 2017 \u2013 were \u201cmisleading and did not accurately or fully disclose the true financial performance of Carillion\u201d, the Financial Conduct Authority said at the time.<\/p>\n

It added: \u201cThose announcements made misleadingly positive statements about Carillion\u2019s financial performance generally, and in relation to its UK construction business in particular.<\/p>\n

\u201cThe announcements did not reflect significant deteriorations in the expected financial performance of Carillion\u2019s UK construction business and the increasing financial risks associated with it.\u201d<\/p>\n

Separately, the Financial Reporting Council has yet to conclude an investigation into KPMG’s audits of Carillion’s financial accounts, which it launched five and a half years ago.<\/p>\n

In February<\/a>, KPMG settled a \u00a31.3bn lawsuit with the Insolvency Service, which had alleged that the accounting giant’s pre-collapse audit of Carillion was negligent. KPMG had previously described the allegations as \u201cwithout merit\u201d.<\/p>\n

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The official receiver meanwhile said that KPMG missed serious red flags during the audit work it carried out in 2018, such as not responding to allegations that the financial performance of 20 major projects was misstated in Carillion\u2019s accounts.<\/p>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n","protected":false},"excerpt":{"rendered":"

Carillion’s former finance director, Zafar Khan, has been disqualified as a director for 11 years. According to the Insolvency Service, which is overseeing the liquidation of Carillion, Khan caused the contractor to rely on “false and misleading financial information for the preparation of consolidated financial statements for 2016”. The 2016 statement misstated profits in relation …<\/p>\n","protected":false},"author":139598,"featured_media":375209,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"ep_exclude_from_search":false},"categories":[531],"tags":[],"yoast_head":"\n\n\n\n\n\n\n\n\n\n\n\n\n\t\n\t\n\t\n\n\n\n\n\t\n\t\n\t\n