This article is from the source 'guardian' and was first published or seen on . It last changed over 40 days ago and won't be checked again for changes.

You can find the current article at its original source at https://www.theguardian.com/politics/live/2016/jun/08/former-bhs-owner-dominic-chappell-quizzed-by-mps-live-updates

The article has changed 13 times. There is an RSS feed of changes available.

Version 5 Version 6
BHS former owner Dominic Chappell quizzed by MPs - live BHS former owner Dominic Chappell quizzed by MPs - live
(35 minutes later)
12.12pm BST
12:12
Chappell blasts Green over property deal
Chappell takes another swipe at Sir Philip Green, saying the Arcadia boss had sold BHS’s Ealing store to a related party - his stepson - and had to issue a clarification to the pensions regulator.
I was shocked, Chappell says, and shocked that £3.5m profits that should have gone to BHS went elsewhere.
Dominic Chappell says he was "shocked" when found out Green sold Ealing BHS store to stepson
Q: Did you raise it with Green?
Yes. He said “that’s showbusiness,” Chappell replies.
Chappell alleges that Green described property sale to stepson as "showbusiness", and had to retract statement to regulatory body about it.
12.09pm BST
12:09
Dominic Chappell claims BHS failed for three reasons:
1) “Continuous bashing” from the pension regulators and Sir Philip Green - and the regulators inability to reach a deal with RAL separate to Green
2) Trade credit insurance had gone - Green had already said he’d liquidate BHS if he didn’t find a buyer.
If we didn’t buy it, he would have liquidated it for sure
3) Green made a clear pledge that he would provide help with the trade insurance. He didn’t, so we had to find an extra £30m.
12.07pm BST
12:07
Good grief. Chappell claims that he only realised the true scale of BHS’s pensions problem after he bought the company (for one shiny pound coin).
Chappell says he was slapped with Section 72 notice from Pensions Regulator the minute of his £1 BHS deal. "That caused us a lot of issues"
Oh Dominic, you should have know, sighs the committee - saying it’s a clear failure of due diligence.
12.05pm BST
12:05
After probing a few more figures, Jeremy Quin MP has totalled that Chappell only had cash assets of around £25m, not the £94m he claimed.
Chappell denies this....
12.03pm BST
12:03
We’ve not heard anything about BHS’s actual day-to-day operations yet:
Listening to Dominic Chappell's evidence; I'm just checking - BHS was a retail chain? Not a commercial property business? Right?
Updated
at 12.03pm BST
12.02pm BST
12:02
Chappell adds that he received £5m from the Dellal family of property developers (as part of the sale of BHS’s North West House to their ACE company), on top of the £10m from the Green family.
That means the £15m that Retail Acquisitions put into BHS didn’t actually come from his own pocket.
Dominic Chappell is admitting here that Retail Acquisitions put none of own money into BHS - £5m was from Ace, £10m from Sir Philip Green
11.58am BST
11:58
Chappell outlines BHS property deals
Jeremy Quin MP is probing how much cash Dominic Chappell actually had when he bought BHS.
The official documents also show £94m of cash.
That includes £35m in an Olswang account - where did that come from?
Chappell explains that it is to do with the plan to buy Marylebone House from Sir Phillip Green, and then sell it to the Dellal family of property developers (as we heard earlier).
[Ie, the Dellal’s had loaned him the £35m, expecting to buy Marylebone House once the deal went through].
Chappell claims that Arcadia knew about this - something they denied....
But Green then came back and said he had a better offer, so he’d compensate me....
Dominic Chappell contradicts key evidence from Arcadia's Paul Budge: says Green's team was aware £35m deposit from Dellals was for property
Dominic Chappell claims Paul Budge, Arcadia CFO, knew that £35m that established his credibility came from Dellal family.Budge said he didnt
Q: Quin: The accounts show you expected £8.5m from Green as compensation. Did it show up?
It did not, says Chappell, despite being agreed. We eventually received £10m from Green, two months later.
Chappell also confirms that a second property, called North West House, was sold to the Dellals.
And £7m of that sale was transferred to his Retail Acquisitions company.
Q: Why did it leave BHS?
Chappell explains that RAL paid £10m into BHS shortly afterwards.
He also confirms that £3.5m of this £10m came as a soft loan from Tina Green.
That’s Lady Green -- Sir Philip’s wife, who actually owns Arcadia.
11.47am BST
11:47
Chappell: We planned to buy BHS without debts and pensions
Dominic Chappell tells the committee that the original plan, discussed with Arcadia, was to buy BHS “debt free and pension free”.
Those talks started in August 2014.
But RAL was disabused of that notion in January 2015, and realised that it would have to take on the pension liabilities.
According to Chappell, Arcadia told him £50-75m max was needed to fix #BHS pension. Completely implausible
Chappell also confirms that Goldman Sachs were Arcadia’s ‘gatekeeper’ -- he had to persuade GS that he was a credible buyer before he could do any due diligence.
Q: Were you the victim of a classic ‘bait and switch’, asks Conservative MP Jeremy Quin....
Chappell suggests this isn’t the case.
Updated
at 11.59am BST
11.47am BST
11:47
Another jab at Sir Phil:
Chappell: Green said he couldn't turnaround BHS and overhaul rents because "no one's going to do a deal while I'm sat on the back of a yacht
11.42am BST
11:42
Q: Do you think Sir Philip Green is a successful businessman?
He’s very successful at getting rich by taking huge sums of money out of companies, Chappell shoots back.
DC "SPG has been very successful at raising a lot of money from businesses and taking huge sums out of them"
[That’s a reference to the £400m of dividends that BHS paid to the Green family]
11.40am BST
11:40
Chappell’s strategy is pretty clear....
Dominic Chappell says Duff & Phelps are "heavily conflicted" as administrators and Philip Green refers to them as "his ponies"
Dominic Chappell's plan already clear - blame Sir Philip, Darren Topp, administrators, everyone else basically
11.39am BST11.39am BST
11:3911:39
Dominic Chappell blames Sir Philip Green for forcing the closure of BHS.Dominic Chappell blames Sir Philip Green for forcing the closure of BHS.
If Philip had assisted us, we could have saved BHS. We were in the process of moving forwards, Chappell claims.If Philip had assisted us, we could have saved BHS. We were in the process of moving forwards, Chappell claims.
Dominic Chappell says Sir Philip Green had "close relationship with Duff & Phelps, the BHS administrator, and brought them inDominic Chappell says Sir Philip Green had "close relationship with Duff & Phelps, the BHS administrator, and brought them in
He says Green still had a financial claim on BHS (despite having sold it), while the pensions minefield was addressed.He says Green still had a financial claim on BHS (despite having sold it), while the pensions minefield was addressed.
Q: Was it a Sword of Damocles?Q: Was it a Sword of Damocles?
It was a stick that we were continually beaten with, Chappell replies.It was a stick that we were continually beaten with, Chappell replies.
He also claims that Darren Topp tried to ‘wiggle his way’ into the ownership of BHS.He also claims that Darren Topp tried to ‘wiggle his way’ into the ownership of BHS.
Remember, Topp claimed this morning that Chappell threatened to kill him, over that £1.5m movement of cash out of the company.Remember, Topp claimed this morning that Chappell threatened to kill him, over that £1.5m movement of cash out of the company.
11.37am BST11.37am BST
11:3711:37
Chappell: Fraudster Paul Sutton had "extensive" data on BHS - properties, cashflow, stock levels - assume this came from Philip GreenChappell: Fraudster Paul Sutton had "extensive" data on BHS - properties, cashflow, stock levels - assume this came from Philip Green
11.33am BST11.33am BST
11:3311:33
DOMINIC CHAPPELL HEARING BEGINSDOMINIC CHAPPELL HEARING BEGINS
Dominic Chappell has taken his seat before MPs to answer (a lot of) questions about the collapse of BHS.Dominic Chappell has taken his seat before MPs to answer (a lot of) questions about the collapse of BHS.
Q: How did you meet Sir Philip Green?Q: How did you meet Sir Philip Green?
Chappell explains that he met the Arcadia boss (and former owner of BHS, of course) through a gentleman called Paul Sutton (who is a convicted fraudster).Chappell explains that he met the Arcadia boss (and former owner of BHS, of course) through a gentleman called Paul Sutton (who is a convicted fraudster).
Chappell says Sutton had been working on a deal to buy BHS. And Chappell and his team subsequently began work on the deal -- but found that he didn’t find Sutton credible.Chappell says Sutton had been working on a deal to buy BHS. And Chappell and his team subsequently began work on the deal -- but found that he didn’t find Sutton credible.
We believe Sutton was hood-winking people, Chappell says, making claims about his links to Sir Philip Green which weren’t true.We believe Sutton was hood-winking people, Chappell says, making claims about his links to Sir Philip Green which weren’t true.
Dominic Chappell starts strongly, admitting he was introduced to BHS deal by fraudster Paul Sutton in early 2014Dominic Chappell starts strongly, admitting he was introduced to BHS deal by fraudster Paul Sutton in early 2014
Chappell: Eddie Parladorio was working with Paul Sutton on previous bid for BHSChappell: Eddie Parladorio was working with Paul Sutton on previous bid for BHS
(Eddie Parladorio is one of the Retail Acquisition directors we heard from earlier)(Eddie Parladorio is one of the Retail Acquisition directors we heard from earlier)
Related: City ally of Philip Green advised fraudster who tried to buy BHSRelated: City ally of Philip Green advised fraudster who tried to buy BHS
Dominic ChappellDominic Chappell
UpdatedUpdated
at 11.37am BSTat 11.37am BST
11.23am BST11.23am BST
11:2311:23
If you’re just joining us, then hello :)If you’re just joining us, then hello :)
Here’s our news story about the remarkable revelations from the current CEO of failed retail chain BHS, and the former finance chief:Here’s our news story about the remarkable revelations from the current CEO of failed retail chain BHS, and the former finance chief:
Related: Dominic Chappell threatened to kill me, says BHS chief executiveRelated: Dominic Chappell threatened to kill me, says BHS chief executive
11.21am BST11.21am BST
11:2111:21
The session with Dominic Chappell’s former directors at Retail Acquisitions has ended.The session with Dominic Chappell’s former directors at Retail Acquisitions has ended.
Next up, Chappell himself.Next up, Chappell himself.
Committee chairman Iain Wright says it could take a long time.... so calls a brief suspension to proceedings. We reconvene at 11.25am.Committee chairman Iain Wright says it could take a long time.... so calls a brief suspension to proceedings. We reconvene at 11.25am.
11.19am BST11.19am BST
11:1911:19
Remember BHS was sold for a £1. Anyone could have bought it. The important issue was did a buyer have the money to fund a turnaround.Remember BHS was sold for a £1. Anyone could have bought it. The important issue was did a buyer have the money to fund a turnaround.
11.19am BST11.19am BST
11:1911:19
Frank Field MP asks about BHS’s pension liabilities.Frank Field MP asks about BHS’s pension liabilities.
Stephen Bourne says that the original proposal that RAL would buy BHS without its pension liabilities was floated before Christmas 2014.Stephen Bourne says that the original proposal that RAL would buy BHS without its pension liabilities was floated before Christmas 2014.
He denies that the property deals were a later ruse to boost Chappell’s credibility; why would Sir Philip Green need to build up Chappell’s credibility, to himself?He denies that the property deals were a later ruse to boost Chappell’s credibility; why would Sir Philip Green need to build up Chappell’s credibility, to himself?
Because it would allow Green to present Chappell as a credible buyer, Field suggests.Because it would allow Green to present Chappell as a credible buyer, Field suggests.
11.15am BST11.15am BST
11:1511:15
Stephen Bourne tells MPs that “nothing improper” occurred during the negotiations to buy BHS last year.Stephen Bourne tells MPs that “nothing improper” occurred during the negotiations to buy BHS last year.
Dominic Chappell was running around, trying to find the money, talking to Philip Green, while we focused on other aspects of the deal, Bourne says.Dominic Chappell was running around, trying to find the money, talking to Philip Green, while we focused on other aspects of the deal, Bourne says.
Retail Acquisitions boss says Chappell got BHS deal back on track after being rebuffed after personal negotiations with Sir Philip Green..Retail Acquisitions boss says Chappell got BHS deal back on track after being rebuffed after personal negotiations with Sir Philip Green..
11.13am BST
11:13
The MPs are now asking the former Retail Acquisitions (RAL) directors why several “jumped ship” and left RAL at the same time, shortly after the BHS deal
One, Stephen Bourne, says he wasn’t comfortable about new directors chosen by Chappell.
A second ex-director says he hadn’t planned to stay on after the BHS deal. There’s talk of pressure of work from other responsibilities.
Updated
at 11.13am BST
11.09am BST
11:09
The key issue in these complicated property deals is that Dominic Chappell appears to have used the promise of a future profit on Marylebone House to get a loan (from property dynasty ACE), to suggest that he was a serious buyer for BHS, who could have turned the business around.
And that property deal would have been signed off by Sir Philip Green, raising questions about how much he knew about Chappell’s actual financial muscle.
Big big questions over how much Philip Green knew about £35m from Dellalls and mooted Marylebone House deal w Chappell and Dellals
MPs ask Retail Acquisitions whether £35m that established Chappels credibility effectively came from Sir Philip Green. It looks that way
Amazingly, no-one seems to know who owns Marylebone House today.
"Who owns Marylebone House now?" (#bhs HQ) "I really don't know." say all 4 of the Retail Acquisitions witnesses This is unbelievable.
11.01am BST
11:01
This -->
MPs are confused why Philip Green agreed to sell BHS to Chappell for £1 and had parallel agreement to gift him £8.5m. They are not alone...
11.00am BST
11:00
The MPs are trying, hard, to get to the bottom of an £8.5m payment that Sir Philip Green allegedly promised to pay to Dominic Chappell’s Retail Acquisitions as part of the BHS deal.
The former RAL directors aren’t completely clear about what happened, so I’m frankly confused too.
But I think the story is that the money – which would have given Chappell a guaranteed profit on Day One of owning BHS – didn’t arrive when expected.
There were then conversations, culminating in a £10m payment from Arcadia in June 2015. This is instead of the £8.5m profit that Chappell was expecting to make on the aborted property deal involving Marylebone House (see earlier post)
This is complicated, but basically Green agreed to sell non-BHS building to Retail Acquisitions, didnt, so RAL took cut from BHS instead
Eddie Parladorio: there was "strong understanding" with Philip Green that he would compensate for not giving £8.5m - hence £10m in June 15
For those struggling to keep up with #BHS cesspit, Philip Green allegedly gifted £10m to Chappell, having previously offered £8.5m
Updated
at 11.18am BST
10.49am BST
10:49
Here’s Graham Ruddick’s news story about the remarkable evidence session from BHS’s management this morning:
Related: Dominic Chappell 'had his fingers in the till', says BHS chief executive
10.47am BST
10:47
The committee are kicking the tires on one of the property deals, the sale of Marylebone House.
It’s devilishly complicated. But Retail Acquisitions (RAL) directors are explaining that Dominic Chappell had planned to buy the property for £35m and then sell it to ACE (the property dynasty who had lent him funds) for £45m, and to receive £8m in return.
But Sir Philip Green changed his mind, selling the property to someone else, and promising to compensating RAL instead.
Oliver Shah of the Sunday Times (who’s done some great reporting on BHS) has tweeted the key points:
Retail Acquisitions would have bought Marylebone House from Green for £35m, then sold to Dellal family for £45m, Iain £10m to pay fees
Dellal family put £35m into Olswang escrow to pay for Marylebone House, which Chappell in turn was going to buy from Green family
This starting to look bad for Green. If true, Green would have allowed Chappell's crew to book a £10m profit from property deal + fund deal
So Green gifted Retail Acquisitions £8.5m for cancelling Marylebone House deal, according to Stephen Bourne, and left it in BHS.
More light shed on our story from weekend: Green paid £10m to RAL last June, £5m went into BHS, £3.5m paid down loans, £1.5m taken by RAL
Q: So, BHS wasn’t sold for £1, it was sold for minus ten million quid?
Apparently it’s not as simple as that....
Updated
at 11.05am BST
10.40am BST
10:40
The committee are now taking evidence from former directors of Retail Acquisitions.
They are explaining that Goldman Sachs was the “gatekeeper’ to Sir Philip Green, of the Arcadia Group.
Eddie Parladario - one of Chappell's Retail Acquisitions team agrees with River Rock that Goldman Sachs the "gatekeeper" to Philip Green
Updated
at 11.05am BST
10.34am BST
10:34
That was the end of the session with BHS’s management. These tweets sum things up.
Extraordinary set of revelations from BHS hearings so far - death threats, fingers in the till and a mythomaniac
So, acc to former BHS bosses - Dominic Chappell was a liar who attempted to steal £1.5m, threatened to kill the CEO and claimed to be ex SAS
Highlights start here.
10.23am BST
10:23
Topp also confirms that Dominic Chappell wasn’t even in the office on the day BHS went into administration.
He told staff he was having an eye operation in America; but actually he was on his yacht in the Bahamas.
That’s unacceptable, Topp says.
BHS bosses confirm @DailyMirror story that Chappell was sunning himself on paradise island as chain went bust. https://t.co/GqslEyrzgN
10.20am BST
10:20
BHS CEO: Chappell threatened to kill me over "£1.5m theft"
Q: Is it true that Dominic Chappell tried to move £1.5m out of BHS to a company called BHS Sweden?
That is true, BHS CEO Darren Topp confirms. And Topp’s first response when he discovered the money had moved was to call the police.
Topp explains that he phoned Chappell, and told him, “that’s theft”.
And – “between expletives”, apparently – Chappell told Topp not to kick off about it.
If you kick off about it, I’ll come down there and kill you.
Apparently Chappell had claimed to be ex-SAS....
Chappell said that the money was to “look after the home team” (ie, his Retail Acquisition colleagues).
The next day, a board meeting was called to discuss firing Topp and another director - another lawyer, who explained to Chappell that the transfer was theft.
The money was then returned, minus £50,000 for “fees”, but Topp believes the money has all been recovered.
Those funds were meant to pay staff, Topp explains. It’s “disgusting” that it was ever moved.
Updated
at 10.35am BST