Carpetbaggers under attack

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The Independent Online
Ken Culley, the outgoing chairman of the Building Societies Association, yesterday launched a sharp attack on the Government for failing to change the law to stop speculators, known as carpetbaggers, profiting from the pounds 20bn demutualisation bonanza, writes Nic Cicutti.

Mr Culley, chief executive of Portman Building Society, said the Government's unwillingness to impose a two-year block before new members can vote on flotation plans was based purely on political grounds.

"[The Government] is unwilling to risk alienating large numbers of individuals who are now convinced that they have an entitlement to a payout from their building society, irrespective of their membership," he said. "It is entirely wrong that people who have had no previous connection with a building society and are joining [it] only to vote for its demise, are able to make off with the booty, helped by defective legislation."

Mr Culley's speech to delegates at the BSA annual conference in Birmingham yesterday came as Angela Knight, the Treasury Minister, refused to commit the Government to introducing a two-year rule on new members' voting rights.

Mrs Knight said that even without a two-year rule societies still had the power to stop new accounts being opened. In any event speculation of this sort was bound to fizzle out eventually. She added: "With no change to the two-year rule, each and every building society which chooses to convert has if it decides to use it, a wide discretion over the distribution of shares. The choice is theirs."

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