For a change there is a piece of news of a major scandal in the cooperative sector from UK. Former chairman of the Co-operative Bank Paul Flowers who chaired the Co-operative Bank for three years from 2010, was exposed allegedly buying and using illegal drugs in a newspaper sting.
The latest revelations about Mr Flowers will heap further embarrassment on the Co-operative Group, whose long-standing chairman Len Wardle announced today he was resigning with immediate effect after he admitted “serious questions” were raised by the drugs scandal.
Mr Flowers served as a member of Bradford Council’s executive from May 2010 to August 2011, when he stepped down from the post, saying he had “increasing and competing demands” on his time.
The supermarkets-to-funerals Co-operative Group has launched a fact-finding investigation into “any inappropriate behaviour” and a “root-and-branch” review of its structure in the wake of the revelations about Mr Flowers.
Mr Flowers now faces a police investigation. He has apologised over the scandal and been suspended by the Methodist Church as well as the Labour Party.
The Co-operative Bank is facing a rescue plan which will see majority control turned over to investors including US hedge funds, after it was left with a £1.5 billion gap in its finances following the takeover of the Britannia Building Society.”
The group, which employs 100,000 people, plunged to £559 million losses in the first half of the year, weighed down by its banking arm.
Regulators have said that Mr Flowers went through the appropriate process when he joined the Co-op’s board as non-executive director. But he did not face further scrutiny when he became the bank’s chairman.
