Lex Greensill has accepted a nine-year ban from serving as a UK company director.
\nHis firm, Greensill Capital, collapsed after making risky loans against future transactions.
\nThe company failed with liabilities exceeding \u00a31.6 billion, following breaches of directors\u2019 duties under UK law.<\/p>\n
Lex Greensill, a former financier who fell from grace in 2021 following a high-profile financial scandal, has been banned from directing a company in the UK for nine years.\u00a0<\/p>\n
Ahead of a six-week trial that was supposed to start next week, Greensill signed a \u2018disqualification undertaking\u2019, agreeing to the ban to end court action, announced<\/a> the UK government\u2019s Insolvency Service on Thursday, 4 June.\u00a0<\/p>\n The 49-year-old is the founder of the now-collapsed Greensill Capital, a factoring and supply chain financing company. Factoring is a financial service where a business sells<\/a> its unpaid invoices to a financial institution at a discount, in exchange for immediate capital.\u00a0<\/p>\n It was found that Greensill\u2019s company was growing through lending<\/a> not just against invoices for existing transactions, but also for \u201cprospective receivables\u201d \u2013 also known as transactions that hadn\u2019t happened, nor may ever happen.\u00a0<\/p>\n Once the insurers covering many of these loans withdrew, Greensill Capital crumbled, with liabilities of over \u00a31.6 billion.\u00a0\u00a0<\/p>\n The financial scandal evolved into a political one as former UK Prime Minister David Cameron had worked for Greensill\u2019s company and lobbied<\/a> the government to support it during the COVID-19 pandemic.<\/p>\n Greensill\u2019s activities were found to breach UK corporate law\u2019s Companies Act 2006, which requires to \u201cexercise reasonable care, skill, and diligence as a company director.\u201d\u00a0<\/p>\n