I am grateful for the opportunity to speak briefly in this debate. I congratulate Norman Lamb on helping to secure it in time generously allocated by the Backbench Business Committee. I am pleased to follow Kevin Hollinrake, who—along with so many other colleagues present—has worked so hard to ensure that the issue gets the attention that it deserves.
I have spoken in this House before about my constituent, Ms Julia Davey, who ran two successful businesses, Angelic Interiors Ltd and Angel Group Ltd. Despite fixed assets and shareholder funds worth multi-millions across the two businesses, they both ended up being placed into administration, which has lost Ms Davey more than £6 million. She followed advice from Lloyds bank during her time running the two businesses, and she believes that responsibility for the liquidation of her assets lies with it.
In 2009, unbeknown to Ms Davey, her account was transferred by Lloyds to its business support unit. Two years later, she was told that she had to pay for the services of a so-called turnaround company, Baronsmead Consultancy, which went on to charge her extortionately for its work. In good faith, she paid it more than £6 million in costs and fees, only to discover from a well-placed whistleblower inside Baronsmead that, far from working in her interests, it was taking her money while colluding with Lloyds to put her out of business and into administration.
Sadly, in the 18 months in which I have been trying to help Ms Davey since our last debate on the topic, nothing has progressed. Ms Davey is still being pushed through bankruptcy processes that she should not have to face. Like the constituents of other hon. Members, and like others who have been mentioned in this debate, she has found her life left in ruins. Her mental and physical health have both been hit, and she tells me that her wellbeing has been further disregarded by Deloitte, which took her to court at a time when it knew that she was the sole carer for her mother, who was dying from cancer. Just a few weeks ago, Ms Davey’s office was broken into; two laptops were stolen and the server was tampered with. The campaign against her has been relentless, but there has been no such rigour from the Financial Conduct Authority or the police to bring to justice those whom she believes to be the real perpetrators.
Ms Davey might not have known the true course of events that led to the demise of her businesses if it had not been for a whistleblower who alerted her in 2013 to what was being done to her companies. Clearly, whistleblowers are invaluable in calling out immoral and frankly criminal acts such as those that have been detailed in our debate. As other colleagues have outlined, we urgently need legislation to protect whistleblowers and the public by deterring and preventing these situations. The Public Interest Disclosure Act 1998 has failed to protect whistleblowers or address the concerns that they raise. It is high time that an independent structure was put in place to vigorously regulate the banking industry and protect whistleblowers, to prevent further cases like Julia’s.
It is greatly worrying that banks and their advisers can operate so unethically, employing turnaround companies to act on their wishes to liquidate a company while posing as a supportive business and facing no accountability whatsoever. In my constituent’s case, the turnaround company, Baronsmead, is not covered by regulation because it does not fall within the remit of the FCA. Similarly, not all the activities of Lloyds Banking Group come under the FCA’s watch.
I would be grateful if the Minister commented on how and when new regulations might be introduced to provide oversight of all the operations of banking groups and the companies that they employ. I would also like to know why the FCA is not investigating the case as a genuine whistleblower complaint, eight months after receiving the information. The whistleblower has provided extensive evidence of the wrongdoing involved, but my constituent feels that the FCA has blocked her questions about an investigation and allowed the bank’s cover-up to continue.
As I mentioned, the whistleblower first came forward in 2013 to raise concerns about the manipulation of Ms Davey’s companies by Lloyds Bank and its agents, but those concerns were not acted on. It was only after WhistleblowersUK entered the picture in November 2018 that a meeting was arranged between the FCA and the whistleblower. Ms Davey’s case was then referred from the FCA to the National Crime Agency, but since then the FCA has not answered questions about what investigations might be going on with the NCA, using the Federal Information Security Management Act as a shield.
I ask the Minister why no information is being provided to my constituent, her advocates or the whistleblower. Furthermore, what can be done to ensure that the FCA acts on this serious matter? I understand from WhistleblowersUK and its chief executive, Georgina Halford-Hall, that there is concern that when the FCA gets involved in such cases, it is seen to be an ally of the financial services, rather than an independent regulator, and that the complaints processes are designed to stifle information that could lead to prosecution.
Staff at the FCA have told WhistleblowersUK that the FCA has a responsibility to ensure that there is not a run on a bank that might impact the UK economy. That would not be a problem if whistleblower intelligence were acted on. This is a public interest issue of extreme importance; members of the public, especially owners of small and medium-sized enterprises, must be aware of the malpractice that can happen in the banking industry and, most importantly, be protected from it. I look forward to the report that WhistleblowersUK is due to release later this month, which I am sure will be very helpful.
I am grateful for the opportunity to present Ms Davey’s case to the Chamber, but I am disappointed that I have had to do so. This case has dragged on for years, and in that time, Ms Davey has endured repeated attempts to smother her case, as well as attacks on her health, her private information and her personal property. She has gone from being a successful small business owner, who trusted her bank to uphold its professional and moral obligations, to being forced through bankruptcy procedures, and desperately fighting court case after court case. The serious injustice of having lost millions must be addressed, and stringent regulation should be brought in, so that no more hard-working business owners fall victim to this, as she has done. I look forward to the responses of the Minister and the shadow Minister.