Liberty Steel owner’s business empire investigated by Serious Fraud Office

Investigators looking at Sanjeev Gupta’s financing arrangements with Greensill Capital

Adam Forrest@adamtomforrest
Friday 14 May 2021 16:49

Related video: Treasury Committee member says Greensill Capital was a Ponzi scheme

The business empire of Liberty Steel owner Sanjeev Gupta is under investigation over suspected fraudulent trading and money laundering.

The Serious Fraud Office (SFO) said it was probing suspected fraudulent trading and money laundering at companies within the Gupta Family Group Alliance (GFG).

Investigators will also look at his financing arrangements with the failed finance company Greensill Capital – in the spotlight over David Cameron’s lobbying activities.

“The SFO is investigating suspected fraud, fraudulent trading and money laundering in relation to the financing and conduct of the business of companies within the GFG, including its financing arrangements with Greensill Capital,” the SFO said in a statement on Friday.

Mr Gupta’s companies were among the main clients of Greensill before it collapsed in March this year. GFG’s reliance on Greensill caused many to worry that it might be at risk following the finance firm’s demise.

The SFO probe follows an announcement by the Financial Conduct Authority (FCA) earlier this week that it is investigating Greensill, having received allegations relating to the firm’s collapse that were “potentially criminal in nature”.

The Financial Times has previously reported Mr Gupta’s companies handed suspicious invoices to Greensill.

Greensill’s model worked by placing itself between business customers and their suppliers. It would immediately pay the invoices that suppliers gave to their customers, meaning the suppliers would not have to wait for months for payment.

The FT said one of Mr Gupta’s companies had sent Greensill invoices for business it had supposedly done with four European metal companies. But the companies told the newspaper they had not dealt with GFG.

In response, GFG Alliance said the invoices were for products it expected to perhaps sell in the future.

Sanjeev Gupta, the head of the Liberty Group

Greensill founder Lex Greensill and Mr Cameron, who lobbied for the company from 2018, were both questioned by MPs on parliamentary committees earlier this week.

Mr Greensill denied suggestions from MPs on the Commons Treasury Committee that his collapsed firm was a “fraud” or a “Ponzi scheme”.

He said that the ultimate reason his company failed was because insurers withdrew cover, and declined to say how much was lent to companies operated by Mr Gupta.

On Thursday it was revealed that Mr Gupta recently pulled the plug on Wyelands Bank, a lender he is the biggest shareholder in.

The bank’s board said it was looking for new owners after Mr Gupta told them he would not continue to prop up the ailing lender. In May last year Mr Gupta gave the bank a loan of £75m.

Join our new commenting forum

Join thought-provoking conversations, follow other Independent readers and see their replies

View comments