April 13 2024

Senator Howard Baker’s question: “What did the President know and when did he know it?” went to the heart of the Watergate scandal. But it was another question, asked almost as an aside, which provided the damning evidence: the question to Alexander Butterfield, a Nixon aide, about whether, in addition to the taped instructions given by Nixon to his secretary every evening, there were other recording devices in the White House. That “yes” and the content of those tapes provided the evidence that the conspiracy went right to the top and right from the start.

Something similar seems to be happening now in the Post Office Inquiry with the release of numerous recordings, involving conversations between the external investigators, Second Sight, and the Post Office’s General Counsels, Susan Crichton and, later Chris Aujard. Much of the focus has been on what they show about Paula Vennells’ knowledge of Horizon’s failings and its consequences for subpostmasters, contrary to what she later claimed to a Parliamentary Select Committee.

With all the focus on Vennells, her Chairs, Alice Perkins and Tim Parker and the lawyers, we are in danger of ignoring two important areas of interest.

(1) Ignoring the role of those who were in charge long before Ms Vennells became CEO. They were told very specifically of the problems. I have written more here about what Allan Leighton, Chair in 2003 was told by Alan Bates. Mr Bates was also telling others in the Post Office from 2000 onwards. Alas, there are none so deaf as those that don’t want to hear.
(2)  Not asking questions of those further up the chain of command: those who held the purse strings, who owned the company – the government – which had a director representing its interests on the Board.

Some Questions

– How far were the Board’s actions – and failures to act – influenced by the government’s push to make Royal Mail profitable and ready for privatisation?

Remember: by the time of privatisation the majority of the prosecutions, the miscarriages of justice had happened. The Post Office was still part of Royal Mail. The evidence of Sir Michael Hodgkinson this week made it clear that the Post Office was still relying on committees of the Royal Mail Board to do detailed consideration of matters which the Board should have been considering (though how effective this was is open to question). Those in charge of Royal Mail were ultimately responsible.

– Did the Board fail to act because it did not know or want to know?

– Or did it act in the way it did – which looks remarkably like an attempt to cover up what had been happening – because that was what its owner, the government, wanted?

– Is it plausible that Parker, Vennells and others would have acted as they did – from the statements made to Parliament, the instructions to lawyers in relation to the Bates litigation, the evidence given to the court, the decisions made about what not to reveal, the decision to try and get Mr Justice Fraser removed from the case, the involvement of a senior retired Supreme Court judge in that failed venture and so on – if they hadn’t been confident that the government had their backs?

– Was this really a rogue organisation which misled its owners or kept them in the dark throughout this 20 year period while nonetheless managing to persuade it to provide ever increasing amounts of money to fight the subpostmasters and defend it in Parliament?

– And, if so, what does that say about the governance – the competence, curiosity and integrity – of the Business Department and its Ministers over this period?

– Or is it possible that the government, that Ministers and civil servants in the Business Department and elsewhere (remember the Post Office’s Chair, Tim Parker, was also Chair of the Courts and Tribunals Service at the same time as he was authorising his lawyers to try and get the judge thrown off a case involving a company he chaired) knew about – and may have been actively involved in or tacitly or explicitly approved of – the cover up of the miscarriages of justice?

That last is the question which now needs answering. Not avoiding by blaming the whole farrago on Vennells and others, however blameworthy they may be.

A troubling, current, conflict of interest

I have written elsewhere about some odd conflicts of interest which appear not to have troubled the government despite the obviously concerning issues raised. One in particular seems ever more untenable.

How can one of the Post Office’s Board directors also be on the Board of the Crown Prosecution Service, chairing the Risk and Audit Committees of both bodies, given the very real prospect of the former’s ex and current employees being investigated and possibly prosecuted by the latter?

– How can the Business Department and the Ministry of Justice possibly think this is right? Or wise?

– How can they not see that it creates, at best, the perception of a potential conflict of interest and may create an actual conflict of interest in future?

Unless they don’t care? And why might that be?

Will the Williams Inquiry get to the bottom of this? Unlikely. Unless the executives and lawyers now being held out to dry decide to talk freely. What the Business Department was doing, what it knew, what it approved, what it turned a blind eye to, what civil servants knew, what Ministers were or were not told are not within the Terms of Reference. Unsurprisingly.

But we need to know because, bad as this scandal is on the evidence we have seen so far, it would be infinitely worse if it were the government which was in part responsible for the miscarriages of justice and their cover up.

50 years on from Watergate the key question for the government remains: What did it know? When did it know it?

December 20 2023

In the words of the Managing Editor –

“Carroll Barry-Walsh is good value as ever in an entertaining end-of-year piece from GRIP“.

The piece is here.

The GRIP Files: Carroll Barry-Walsh

It is not often that Oscar winning actors feature in Compliance articles. So if that doesn’t sharpen your appetite …….

You can also hear more from me and and some expert panellists from K2 Integrity and White and Case – Joanne Taylor, Jonah Anderson and Ghazanfar Shah  – on What Can Go Wrong in Investigations and How to Fix This here.

Enjoy!

Photo by Paola Chaaya on Unsplash

March 30 2021

Perhaps there was a clue in the name: Archegos. Arch. Egos. As a description of many in finance it can scarcely be bettered. A novelist might even think it a tad too unbelievable, unless you were seeking to write satire.

But why bother when reality serves it up on a plate.

The founder of Archegos Capital Management, Bill Hwang described himself in 2008 as “like a little child looking for where can I invest to please our God.” Not long after – in November 2009 – Goldman Sachs’s Lloyd Blankfein described  bankers as “doing God’s work“. Oh dear. The full extent of what bankers had been doing had yet to reveal itself, whether to God or anyone else. Still, PR advisors would do well to note that such statements do not impress. Rather they tend to bring to mind the Ralph Waldo Emerson quote:

“The louder he talked of his honour, the faster we counted our spoons.”

Back to Mr Hwang. At the time of his humblebrag he was running Tiger Asia Management, which ended up being one of the largest investors in the expanding and profitable Asian market.

What God thought of Mr Hwang’s activities is unknown. What the SEC thought is, however. For in 2012 following a lengthy investigation, also involving the HK regulator, he pleaded guilty to insider trading and manipulation relating to trading in various Chinese stocks in late 2008 / early 2009. Surely not when he was trying to please God? Yes, apparently so.

A humongous fine inevitably followed. And almost as inevitably, the following year in 2013 Tiger Asia Management was wound up and Archegos rose, Phoenix-like in its place.

Now it is in trouble as a result of risky and very large investments having soured. Also in trouble are a number of banks which funded it, provided it with services and helped it trade. Questions no doubt are being asked – and, if not, they should be – about banks’ exposure to the firm, was this within risk limits, why so much leverage and so on. Other questions might also be asked: what due diligence was done? Was a fund run by a convicted insider dealer really a suitable client? How was it monitored? And so on.

Still, since bragging seems to be the fashion, might I modestly refer you to this article and my comments on what is often found when something goes wrong: “…so often, in virtually every case, there were bloody great red flags, or there was a clue that was missed.”

The name might have permitted a wry smile. Mr Hwang’s track record should not have done. Does no-one ever read this stuff?

Photo by Orkun Azap on Unsplash