Posted by: westlancashirerecord | February 4, 2019

What Became Of Due Diligence?

The Shipping Company With No Ships

Much has been made of the mystery about how a shipping company without ships, Seaborne Freight

will acquire the necessary tonnage to fulfil its £14m contract with the government in the event of a no-deal Brexit. Which outsourcing genius thought that up? And where was the due diligence? Due diligence is the investigation or exercise of care that a reasonable business or person is expected to take before entering into an agreement or contract with another party, or an act with a certain standard of care.

The story shows how such outsourcing works, or perhaps doesn’t. It depends on giving the right answer for receiving more work. Never mind the lack of physical evidence, or the experience of the company. Seaborne Freight is a private limited company limited by shares, incorporated on 5 April 2017, and its current liabilities are £374,275, having paid its directors some undisclosed consultancy fees, £81,778. Any warning bells ringing yet?

It might remind us of the WLBC approach

to its nonexistent due diligence of the landfill development of the Beacon Park Golf Course. Its initial leaseholder, for £1 a year, DCT Leisure Ltd, was miscreant in respect of its VAT liabilities. WLBC allowed it to contract for the landfill development by Oakland Golf and Leisure Ltd, whose director was already miscreant too, having committed VAT payment evasion and convicted of breaches of planning permissions in Knowsley. And then came Serco Leisure Operating Ltd, another holder of the Beacon Park Golf Course £1 annual leasehold.

Serco Leisure Operating Ltd still holds that lease, didn’t undertake due diligence on Oakland Golf and Leisure Ltd, and now itself has committed planning breaches which it is obliged to correct. Landfill royalties have been shared out, mainly to Oakland Golf and Leisure Ltd but also to Serco Leisure Operating Ltd, as admitted by the Serco plc Chairman Rupert Soames, of £183,864.

Walk A Crooked Mile, or A Crooked Course

It reminds me, somewhat tongue in cheek, of a post-war film, “Walk a Crooked Mile”, about a spy ring. In this case, Beacon Park Golf Course, it’s “Walk a Crooked Course”, as a conspiracy ring that has enabled untold landfill royalties to be paid but not accounted for, no VAT accounted for, and the only losers are the West Lancashire council tax payers. Did any warning bells ring in Derby Street? No due diligence, that’s the problem. Just like central government.

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