The collapse of BHS and consequent black hole in the pensions fund that caused Sir Philip Green such discomfort (and £363m in cash) drew blood from Dominic Chappell yesterday when a court found him guilty of failing to provide information to The Pensions Regulator.
Within days of the deal, The Pensions Regulator was demanding hundreds of documents in relation to what is said was a £571m black hole in the BHS pension fund.
Sir Philip Green – after a long and bruising series of encounters with the Work and Pension Committee that resulted in a war of words between Green and committee chair, MP for Birkenhead Frank Field – finally agreed to pay £363m towards the deficit.
This followed months in which he was vilified by the press, with tabloids renaming him Sir Shifty and sending reporters to attempt to question him on his £115m yacht Lionheart.
The action against Chappell by The Pensions Regulator comes after the high street chain collapsed in April 2016, with the loss of 11,000 jobs and 164 stores.
At stake were some 19,000 pensions, and after the collapse of the firm, The Pensions Regulator submitted three written enquiries called Section 72 notices that Chappell ignored, despite a statutory duty to comply.
Yesterday’s verdict will be seen as vindication for The Pensions Regulator, whom MPs had called “reactive and slow-moving”.
During the trial, Chappell had attempted to portray himself as a man more sinned against than sinning, claiming that he had wanted to cooperate with the regulator, but that his efforts had been curtailed by a number of factors.
These included his inability to gain access to BHS offices, an onerous workload and a “heavy cough”.
This was relevant, said his legal team, as it could have aggravated an old medical condition that had caused a detached retina.
That meant, he claimed, that he had received medical advice to “not watch television, not read books”, which meant that he was unable to deal with documentation.
As well as causing some sniggers in court over the complained-of “heavy cough”, there was more laughter when it was pointed out to Chappell that he had got his own age wrong, being 51 and not 50 as he had told the court.
‘Not credible’ and ‘making no sense’
In any case, district judge William Ashworth, sitting at Brighton Magistrates Court, seemed unimpressed with Chappell’s credibility as a witness, saying that said some of Chappell’s evidence was “not credible” and some of his answers “making no sense”.
“All the requests made were valid and reasonable and all the time frames to fulfil these requests were also reasonable”, said the judge, adding that some of the evidence was “incomprehensible” and his explanations for not providing the information “unreliable”.
During the trial, Chappell claimed that he was being made a scapegoat for unspecified others, with his legal team stating that shortly before Chappell took over, BHS office staff had been seen putting “bin bags” of documents into an “industrial-sized” shredder at the rear of BHS’s head office in London.
Chappell now faces an unlimited fine, having been found guilty on all three charges.
It is likely to mean that Chappell will face financial hardship once again, as any fines are seen as likely to outweigh the £2.6m that Chappell drew in salary during his controversial 13-month tenure at the helm of the stricken high street retailer.
Outside the courthouse, Chappell remained characteristically defiant, saying that he would be launching an appeal.
“We feel this case has not been treated fairly,” he said. “We will look deeply at this.”
For The Pensions Regulator, Nicola Parish said, “Dominic Chappell failed to provide us with information we had requested in connection with our investigation into the sale and ultimate collapse of BHS, despite numerous requests.
“Anyone who fails to cooperate with our information notices risks getting a criminal record. Our separate anti-avoidance action against Dominic Chappell continues.”