Lord Walker received the report by The Kalchas Group, a firm of consultants, shortly before he rejected the chairmanship of the company in July 1991. MCC went into administration in December that year.
The report was based on information supplied by Lord Walker, who was then chairman-designate of MCC and is also a limited partner of Kalchas. The firm's offices are in the building occupied by Smith New Court, MCC's stockbroker. The consultants said that MCC was suffering a severe outflow of cash which, if not stemmed, could mean that the group would need up to pounds 2bn of extra finance. After MCC's collapse, it was revealed that Robert Maxwell had taken more than pounds 200m from MCC and that it had suffered a cash crisis in July 1991, when it failed to pay five banks, including Barclays, for foreign exchange contracts.
In late June 1991, Lord Walker asked the corporate finance department of Smith New Court, of which he is also a director, to review the accounts of MCC before they were published. Smith concluded that MCC's profits were entirely made up of foreign exchange profits, income from the sale of properties or other items not in the course of normal trading.
Shortly after receiving the two reports, it was announced that Lord Walker would not take up the chairmanship of MCC. At the time, Lord Walker said that he had decided not to take up the role because he believed the group should be run from the US. But later he said that Robert Maxwell had decreed he should not be chairman. Lord Walker left MCC's board in September 1991 with a pounds 500,000 pay-off.
The two reports have not been made public, and Lord Walker has maintained that there were never any 'internal' reports into MCC. However, it is understood that copies of both reports are kept under lock and key in the offices of Smith New Court.
Lord Walker was due to appear before the House of Commons' Social Security Committee on Tuesday to face questions about his role in MCC. The hearing has been delayed because the Serious Fraud Office has objected to the committee questioning people that it might also wish to interview.
The meetings should reconvene later this month, and Frank Field, the committee's chairman, has asked for all relevant documents.
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