Cameron defends his pressure on Greensill Capital ministers

David Cameron has done it he defended his pressure on UK ministers and officials on behalf of Greensill Capital, insisting that it was to benefit the economy rather than preserve the value of its stock options in the company.

The former prime minister, who made his first public comments about Greensill since it collapsed in March, declined to say how much money he was going to make from the supply chain financial company before he took office.

Industry figures have reported to the Financial Times that Cameron had shares worth about 1% of Greensill’s stock. At one point, the company was worth $ 7 billion.

But Cameron told the House Treasury selection committee that Greensill’s suggestions to him were “completely absurd.” He did not want to say what the actual figure was, but said he had stock options and was paid a “generous amount, much more than he earned as prime minister.”

He added that he had a “large economic investment in Greensill’s future.”

Cameron put pressure on several ministers and public officials, including Treasury officials, on 56 different occasions to try to secure access to Greensill two government-administered Covid-19 debt systems.

After three months of talks, the Treasury decided in mid-2020 that it was not interested in Cameron’s proposals.

Mel Stride, Conservative chairman of the Treasury committee, said Cameron may have been motivated to “undertake this reservoir” of contacts at the start of the coronavirus crisis in the spring of 2020 because he had realized his “opportunity to make a lot of money was threatened ”.

The former prime minister said: “My motivation for contacting the government was that we had a good idea to extend credit to businesses.”

Stride asked if Cameron should have known Greensill was in trouble when concerns about the company first arose, including in a Financial Times Report May 2020.

But Cameron said he did not realize the company was in serious trouble until December 2020. “I didn’t believe in either March or April.[2020]. . . in Greensill there was a risk of falling. “

Angela Eagle, a Labor committee member, told Cameron that some of her messages to ministers and officials seemed “more than persecution than pressure.”

But Cameron defended his pressure, saying Treasury officials did not believe it was “inappropriate” given the “economic heart attack” that was happening in the UK at the start of the Covid-19 pandemic.

The reason for its “persistence” was that financial technology companies like Greensill “were not well understood” by most people, he added.

Cameron confirmed that he regularly attended Greensill board meetings despite not being a director of the company or participating in the day-to-day running of the business.

“I would attend board meetings, listen to arguments, make contributions, especially on geopolitical issues,” he told MPs. “I was not part of the credit committee, the risk committee or the audit committee.”

Cameron also tried to win clients for Greensill and helped in relationships with important clients.

The road to the Greensill collapse began in September 2020 when Tokyo Marine, its main insurer, warned it would withdraw coverage within six months.

Cameron said he had not been aware of the move, although he had been attending board meetings and listening to the company’s internal podcast.

The former prime minister acknowledged it Greensill had an excessive “customer concentration” with GFG, the metals group led by industrialist Sanjeev Gupta.

He also said it was “very disturbing” to read one FT report that the companies listed in Gupta’s loan documents refused to do business with GFG.

But Cameron defended Greensill’s practices. “The fact that the company is addressing the administration does not mean that everything about it was wrong,” he said. “It doesn’t mean it’s all a giant scam.”

Cameron said that as prime minister, he had drafted rules that required any meetings between ministers and lobbyists to be disclosed, but not text and phone calls.

In opening statements to the committee, Cameron said he had not broken the rules, but admitted that “prime ministers are in a different category” in terms of conduct after leaving office.

As such, he had made a mistake by pressuring ministers and officials by text message instead of writing a formal letter, he said.

Cameron said it was “very depressing” to have worked for a bankrupt company.

He later told the Commons Public Accounts Committee that it was former Cabinet Secretary Jeremy Heywood who brought Greensill to Whitehall in 2011 to advise the government on supply chain financing, which led to the creation of a loan plan for pharmacies.

He said he only met Lex Greensill, the company’s founder, twice before 2016 and that he hadn’t had any role for Greensill Capital to award him the pharmacy contract in 2018. “It’s like saying, I’ve benefited from organizing your marriage six years ago because six years later I married your ex-partner. “