‘There is a set of British oligarchs who, like their Russian counterparts, have become unimaginably rich as a result of looting the British state.’
Bob Wylie takes no prisoners in his account of the scandal over the collapse of outsourcing company Carillion: Bandit Capitalism: Carillion and the corruption of the British State. He explains the link with the Russian oligarchs: in ‘the trillion dollar scam of looting the Russian state the oligarchs became unimaginably rich, unaccountable and almost untouchable…and that takes us to the Carillionaires – the Carillion oligarchs.’
It makes for a ripping read, and a gripping discussion in the Birlinn podcast series. And a fitting point for the first in our Sceptical selection of choice podcasts. Here Bob Wylie, former BBC Scotland News Correspondent, is interviewed by fellow Birlinn author Ray Perman, former Financial Times Scottish correspondent, and author of Hubris: How HBOS wrecked the best bank in Britain, and The Rise and Fall of the City of Money: A financial history of Edinburgh
Spot the connection? As in the financial crash of 2008, the perpetrators of the 2018 Carillion crash got off scot free while the tax payer picked up the bill.
Wylie describes the Carillion ‘ponzi scheme’ with brutal clarity. When the government outsourcer folded it had only £29 million in the bank yet it owed a staggering £7 billion. As well as £1.3 billion owed to the banks, there was a £2.6bn hole in the pension fund. To salvage the pensions owed to Carillion workers, British taxpayers had to pick up the tab.
Why didn’t the auditors flag this up? Where are the regulators? How did such jaw dropping debts happen?
It’s no surprise to either of the Birlinn authors. None of the 2008 bankers, or auditors were punished. Wylie does not hesitate to name names. The big four accounting firms, KPMG, Deloitte, Ernst and Young, Price Waterhouse, who took £75m in fees in the ten years leading to collapse – ‘none of them emerge with a clean bill of health.’
Have lessons been learned?The sad fact is that we never seem to learn – as you can hear in the sequel to this podcast when Wylie interviews Perman about the Rise and Fall of the City of Money.
Well worth a listen. Sharp, concise, witty and informative. And it’s not Covid.
Sceptical Scot podcast How banks captured the state
Birlinn podcast series