The business empire of Sanjeev Gupta, owner of Liberty Steel, including its financing arrangements with bankrupt Greensill Capital UK, is being investigated by the UK Office for Serious Fraud, the agency said on Friday.
The SFO said in a statement that it was investigating suspected fraud, fraudulent trading and money laundering within the Gupta Family Group Alliance, including links to Greensill, the supply chain financing company that went bankrupt earlier this year. Because it is an active investigation, the agency said it would not comment further on the investigation.
Gupta’s companies were one of Greensill’s most important customers before the collapse in March. Their confidence in Greensill expressed concern about their financial health when it went through. Liberty Steel, which employs 5,000 people, has called for a rescue by the government following the collapse of Greensill.
Greensill’s model worked by positioning itself between businesses and their suppliers. It immediately pays invoices that suppliers have given to their customers, for a fee. In fact, it has given providers security by ensuring that they do not have to wait for months for payment.
The relationship between Gupta’s companies and Greensill has been in the spotlight for the past few weeks. Former British Prime Minister David Cameron, who acted as an adviser to Greensill, who involved him in his contacts in government and in the civil service, was caught in the fall of the firm’s bankruptcy.
Cameron testified before lawmakers on Thursday about his activities for Greensill, which he said were motivated by a desire to help support British workers and businesses “in the economic turmoil caused by Covid” and not by the prospect of millions from his Greensill to earn shares.
Opposition parties have called for tougher rules on liaison between government officials and government officials, saying Britain’s lazy enforcement regulations leave the door open for corruption.
The Financial Conduct Authority, Britain’s financial regulator, has already announced a formal investigation into the Greensill crash after receiving allegations that he was ‘potentially criminal in nature’.
The Financial Times reported earlier that Gupta’s companies had handed out suspicious invoices to Greensill, for which the finance company had paid. In response, GFG Alliance said the invoices are for products that are expected to sell in the future.