It mustn’t be easy being the person responsible for slicing Britain off from Europe, but that is David Cameron’s lot. History will remember Cameron as the prime minister who—in a doomed bid to appease a small core of M.P.’s—held a Brexit referendum, staged a half-hearted pro-Europe campaign, lost the vote, and then resigned on the spot. Until very recently, this catastrophic lapse in judgment looked certain to be the man’s legacy. But that was before he started texting the current chancellor of the Exchequer begging for money.
Now Cameron finds himself at the center of an extraordinary multi-billion-dollar Enron-style collapse that encompasses SoftBank, Credit Suisse, and a large part of the British steel industry. It has been one of the swiftest financial obliterations in living memory, swirling with potential abuses of power and an accusation of fraud.
The company that went bust is Greensill Capital. Its founder is a charismatic Australian billionaire named Lex Greensill. And he has quite an endearing origin story.
The tale, regularly retailed by the man himself, goes that Greensill was the son of a farmer in Queensland. His parents scratched out a living growing sugarcane in the red Bundaberg dirt, suffering at the hands of the multi-nationals that bought the crop.
Sugarcane can take up to 18 months to grow and, once harvested, it can be another year or two before the farmer sees any money from it, a situation which left Greensill’s family in a precarious financial position. It was a hardscrabble life, but Greensill saw a better way.
What if, rather than waiting two and a half years to see any money from the crops, his parents received the payments from the bank up front, and the multi-nationals repaid the bank later? This acceleration of the payment process, known as supply-chain finance, sounded like it would help everyone.
Greensill’s family couldn’t afford to send him to university. Instead, he studied law by correspondence from the farm, receiving cassette tapes by mail while working pro bono for the Queensland Fruit and Vegetable Growers Association. He left the farm and joined a supply-chain-finance start-up in Australia, helping businesses to get paid early in return for a small cut for the lender. Forebodingly, the start-up went bust.
Now Cameron finds himself at the center of an extraordinary multi-billion-dollar Enron-style collapse.
Undeterred, in 2001 he moved to London to make his name. He joined Morgan Stanley, then Citigroup, and then, in 2011, launched a supply-chain start-up of his own: Greensill Capital. By 2020 the company had exploded in size, with 1,000 employees providing $150 billion in credit to businesses in 175 countries.
At this point, everyone wanted a piece of Greensill. He gave vast amounts of credit to Sanjeev Gupta, a man described by Forbes as “the world’s most ambitious industrialist.” Greensill claims he advised the Obama administration on supply-chain practices. And, most critically, he gained the ear of the British government.
To understand how this happened, we have to return to 2003. While finding his feet at Morgan Stanley, Greensill befriended a managing director named Jeremy Heywood. Heywood was a civil servant at heart, and a legendary one in practice, having been the principal private secretary to three chancellors and a prime minister.
Heywood’s time at the bank was short-lived, and in 2007 he returned to government. However, he never forgot about his charming Australian friend. And when Greensill decided to go it alone, Heywood introduced him to the prime minister.
The rest is history. Cameron asked Greensill to determine how supply-chain financing could help the government, and along the way gave him a security pass, a team of civil servants, a desk in the Cabinet Office, and, in a development that only came to light this week, a business card from the prime minister’s office that appears to describe him as a senior adviser.
In 2012, Greensill proposed a billion-dollar system to speed up payments to N.H.S.-affiliated pharmacies. It went without saying that Greensill Capital would end up funding the scheme. In 2017, he was made a Commander of the British Empire for his services to the economy. Two years later, he was a billionaire.
By then, Cameron was no longer in office. His Brexit gamble had failed, and he had resigned. But Greensill didn’t forget his old friend’s generosity and, in 2018, repaid Cameron with an advisory post at Greensill Capital, with share options apparently worth tens of millions of dollars.
Now, it’s important to point out that there is no set path for prime ministers after leaving office. Tony Blair, for instance, set up a number of trusts and shell corporations to shield the scale of his business empire from public view, while Theresa May remains an M.P. who occasionally lobs an uncomfortable question at the Cabinet in the House of Commons. George Osborne, Cameron’s chancellor of the Exchequer, quickly gained the nickname “Nine Jobs George” after leaving government, taking three advisory posts, chairing a think tank while being chosen as a fellow of another, becoming an honorary professor, taking two roles at Stanford, and, as if that weren’t enough, editing a daily London newspaper.
In comparison, Cameron has been much less productive. Speaking to M.P.’s a year after his resignation, he reportedly described how in retirement he had mainly “bought a hut and taken up smoking.”
Greensill claims he advised the Obama administration on supply-chain practices.
His highest-profile appearance since leaving office was in Sasha Swire’s 2020 tell-all, Diary of an MP’s Wife, in which at one point he jokingly tells the author her perfume makes him want to push her into a bush and “give [her] one.”
Aside from that, he has only really succeeded in haunting the peripheries of British life. “If you don’t get a major job or start a thing like Blair did—and Dave is basically too lazy to start something like Blair—what do you do?” one insider told The Times of London. “He was earning millions from speeches but he wanted to do something—but not very much—to stop being bored.”
In this regard, the Greensill advisory position suited Cameron. It wasn’t a lot of work, and it allowed him to see the world, albeit under dubious circumstances. It was recently revealed that Cameron attended a luxurious desert banquet to lobby Mohammed bin Salman on behalf of Greensill in 2018, after the U.N. had established “credible links” between the prince and the murder of Jamal Khashoggi.
Most importantly, though, it had the potential to make him extremely rich. Last year, during a series of fundraising talks, the company sought a $7 billion valuation when it was considering going public. Cameron allegedly told friends that, if it were successful, he would net around $60 million. Sources close to Cameron have denied this claim.
However, that wasn’t to be. On March 1, one of Greensill’s insurance policies lapsed, and the insurer refused to renew it. This was because, per a letter to Greensill last July, the underwriter in charge of the account was fired for insuring amounts to Greensill “in excess of his delegated authority.”
This caused Credit Suisse to shut down Greensill’s $10 billion in funding. A week later, Greensill filed for bankruptcy. And this has set off a chain reaction among the firms that Greensill loaned money to.
Bluestone Resources, a U.S. coal-mining company owned by American billionaire and Republican politician Jim Justice, has sued Greensill for “continuous and profitable fraud.” Meanwhile, having lost his key financial backer, Sanjeev Gupta has requested a $235 million rescue loan from the British government, which was subsequently turned down, in part because Gupta recently spent $58 million on a house in Belgravia.
And now it has emerged that, almost exactly a year ago, Cameron made the questionable decision to ask the current chancellor, Rishi Sunak, to give Greensill hundreds of millions of dollars in emergency taxpayer-funded pandemic-relief loans. To make things more awkward, he did this by repeatedly texting Sunak’s private phone.
Most of the texts went unanswered, it has been claimed, but nevertheless questions have been raised about the ethics of a former prime minister lobbying the government for a vast amount of free money, not least because, a decade ago, he declared that lobbying by former ministers “goes to the heart of why people are so fed up with politics. It arouses people’s worst fears and suspicions about how our political system works.”
And now the house of cards has collapsed completely. “Even if Cameron escapes legal sanctions, his reputation is blasted, his absence of judgment laid bare,” Max Hastings wrote in The Times this week. “Troubles such as those now afflicting Cameron stem from a sense of entitlement. He aspires to live like his rich friends but his only tradeable asset is the fact of having once been Britain’s leader.”
Whether by coronavirus strain, financial mismanagement, or something more nefarious, Greensill Capital has fallen, and the repercussions are likely to be huge. Other businesses, including Gupta’s, may well topple as a consequence. The reputation of a former prime minister may never recover. But let’s try to be positive. If it all goes wrong, at least Greensill has his farm. And if nothing else, this gives Cameron more time to sit in his hut and smoke.
Stuart Heritage is a Kent, U.K.–based Writer at Large for AIR MAIL