Revealed: Second firm pushed by Michelle Mone was
secret entity of husband’s office
Revelation that LFI Diagnostics was entity of office
that manages wealth of Douglas Barrowman deepens controversy over Tory peer
A crucial document seen by the Guardian suggests that
both PPE Medpro and LFI Diagnostics were set up for the ultimate benefit of
Mone’s husband, Douglas Barrowman, and his family.
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Henry Dyer,
Paul Lewis, Rowena Mason and David Conn
Tue 6 Dec
2022 18.43 GMT
A second
company that the Tory peer Michelle Mone lobbied ministers over in an attempt
to secure government Covid contracts was a secret entity of her husband’s
family office, the Guardian can reveal.
Lady Mone’s
lobbying on behalf of the company, LFI Diagnostics, which she tried to help
secure government contracts for Covid lateral flow tests, prompted a formal
rebuke from a health minister who reminded her of “the need for propriety”.
A
departmental source told the Guardian that Mone was “in a class of her own in
terms of the sheer aggression of her advocacy” on behalf of LFI Diagnostics.
However, it
is the revelation that the company was a secret entity of the office that
manages the wealth of her husband, Douglas Barrowman, that will deepen the
controversy over the Tory peer and her access to ministers.
On Tuesday,
Mone’s spokesperson said that she was taking a leave of absence from the House
of Lords with immediate effect, adding she was doing so “in order to clear her
name of the allegations that have been unjustly levelled against her”.
Mone’s
apparent lobbying during the pandemic of at least four Tory ministers – Matt
Hancock, Michael Gove, Lord Agnew and Lord Bethell – is threatening to become a
major scandal for the government.
In the
House of Commons on Tuesday evening, MPs voted to force the government to
release documents relating to £200m contracts that were given to PPE Medpro in
June 2020, weeks after Mone referred it to Gove and Agnew, using their personal
email addresses.
A crucial
document seen by the Guardian suggests that both PPE Medpro and LFI Diagnostics
were set up for the ultimate benefit of Barrowman and his family.
The
document was prepared by Anthony Page, who runs Barrowman’s family office in
the Isle of Man. It lists both PPE Medpro and LFI Diagnostics as “entities” of
his family office, also known as the Knox family office.
A source
familiar with the Barrowman family office said its “entities” are owned, either
directly or indirectly, for the ultimate benefit of Barrowman or his family.
While Page runs the family office, it is ultimately controlled by Barrowman,
the source added.
Both Mone
and Barrowman have repeatedly sought to distance themselves from PPE Medpro.
Through their lawyers, both have denied any “involvement” in PPE Medpro, or any
“role” in the process through which the company was awarded its government
contracts. Mone’s lawyers also denied she benefited financially from the
company.
However,
the Guardian revealed last month that bank documents stated that Barrowman was
paid at least £65m in profits from PPE Medpro in September 2020, and then
distributed the funds through a series of offshore accounts, trusts and
companies.
One of the
recipients, bank records indicate, was a trust of which Mone and her adult
children were the beneficiaries. It received £29m in funds originating from PPE
Medpro profits in October 2020, the documents state.
The
revelation has sparked a major backlash in parliament, amid calls for an urgent
inquiry into PPE Medpro and Mone’s lobbying of ministers.
Those
demands are now likely to include requests for further disclosures about Mone’s
attempts to win government purchases of Covid lateral flow tests – first on
behalf of PPE Medpro, and then LFI Diagnostics.
‘Extraordinarily
aggressive’ and ‘threatening’ email
Mone’s
lawyers have long claimed that her initial referral of PPE Medpro to ministers
– in relation to its offer of PPE in May 2020 – was a “simple, solitary and
brief step”, after which she “did not do anything further in respect of PPE
Medpro”.
However,
the Guardian has previously reported that for months after PPE Medpro’s success
winning contracts for masks and gowns, Mone continued to help the company try
to sell the government Covid lateral flow tests.
She appears
to have lobbied Lord Bethell, a junior minister in the health department who
was involved in government procurement, in relation to PPE Medpro’s lateral
flow tests as far back as October 2020.
By February
2021, Mone was still contacting civil servants on behalf of PPE Medpro, as it
became apparent its efforts to secure lateral flow contracts was failing.
Jacqui Rock,
the chief commercial officer for NHS test and trace, told colleagues in
February 2021 that Mone was “incandescent with rage” at the treatment of PPE
Medpro over lateral flow testing contracts, saying the firm had been “fobbed
off”, and was planning to speak to Michael Gove and Matt Hancock about her
concerns.
That same
month, LFI Diagnostics Ltd was incorporated, according to Companies House
documents. It too began trying to sell the government lateral flow tests with
Mone’s help. It is not known whether the lateral flow tests LFI Diagnostics
pitched to the government were the same as those PPE Medpro had tried to sell.
Matt Hancock said Mone’s grievance centred on around
her allegation that another more successful company had secured what she
described as a ‘monopoly’ over government contracts for lateral flow tests, to
the detriment of other suppliers
However,
what is known – courtesy of Matt Hancock’s recently published diaries – is the
action the former health secretary said Mone took in June 2021, when it
appeared that LFI Diagnostics’ bid for government business was stalling.
The former
health secretary wrote that Mone then sent him an “extraordinarily aggressive”
and “threatening” email about a lateral flow company that “has had a dreadful
time” cutting through government red tape.
Hancock did
not name the firm as LFI Diagnostics in his diaries, but stated that Mone had
been “representing” its commercial interests. A well-placed source confirmed to
the Guardian the company referred to by Hancock was LFI Diagnostics.
The diaries
state that Mone demanded his “urgent help” and warned that her concerns would
come out in a media exposé, telling Hancock: “I am going to blow this all wide
open.”
Hancock
said Mone’s grievance centred on her allegation that another more successful
company had secured what she described as a “monopoly” over government
contracts for lateral flow tests, to the detriment of other suppliers, leading
the Tory peer to make “wild accusations”.
According
to Hancock, Mone’s message said: “I smell a rat here. It is more than the usual
red tape, incompetence and bureaucracy. That’s expected! I believe there is
corruption here at the highest levels and a cover-up is taking place ... Don’t
say I didn’t [warn] you when Panorama or Horizon run an exposé documentary on
all this.”
It is not
known whether Mone disclosed Barrowman’s family interest in LFI Diagnostics to
Hancock, Bethell or other government officials she contacted with respect to
LFI Diagnostics. The House of Lords code of conduct says peers should declare
when “communicating with ministers or public servants, any interest which is a
relevant interest in the context of the debate or the matter under discussion”.
There is
nothing on Companies House to directly connect LFI Diagnostics with either Mone
or Barrowman. In April 2021, a month after the incorporation of LFI
Diagnostics, “PPE Medpo” [sic] became a 70% shareholder in the company,
according to documents filed with Companies House.
However,
the document seen by the Guardian, which was produced by the person who runs
Barrowman’s family office and lists both PPE Medpro and LFI Diagnostics as
“entities” of the family office, suggests that both companies were created for
the ultimate benefit of Barrowman or his family.
The Tory
peer has never declared Barrowman’s family interest in LFI Diagnostics in her
entry in the register of Lords interests – and there may now be a question over
whether she should have. The code of conduct says peers should register
interests which “might be thought by a reasonable member of the public to
influence the way in which a member of the House of Lords discharges his or her
parliamentary duties”, including those of their spouse or partner “in certain
cases”.
‘The need
for propriety’
In July
2021, Mone’s lobbying efforts on behalf of LFI Diagnostics prompted a formal
rebuke from a fellow Tory peer.
Following
Mone’s email to Hancock, Bethell sent her a letter seen by the Guardian.
Bethell referenced Mone’s “recent correspondence with officials both in DHSC
and the [Medicines and Healthcare products Regulatory Agency] in respect of LFI
Diagnostics” and addressed some of the issues the company was facing.
He offered
Mone a meeting with Dr Jenny Harries, the head of NHS test and trace, to discuss
her “concerns”, and provided the contact address for a supplier-escalation team
that could investigate any issues LFI Diagnostics had in its dealings with
DHSC.
But the
final line of Bethell’s letter appears to admonish Mone. Noting the
government’s gratitude “to all manufacturers and suppliers who have come
forward to offer their assistance in producing lateral flow devices”, Bethell
concluded: “I would however respectfully remind you of the need for propriety
in all dealings with officials.”
Mone, who
was appointed to the Lords by David Cameron in 2015, has already been placed
under investigation by the House of Lords commissioner for standards over
multiple “potential breaches” of the Lords’ code of conduct in relation to PPE
Medpro.
That
inquiry has been paused due to a separate investigation by the National Crime
Agency into PPE Medpro. In April this year, NCA officers searched several
addresses, including the mansion Mone and Barrowman occupy in the Isle of Man.
At the time, lawyers for PPE Medpro declined to comment on the NCA
investigation.
NEWA DHSC
spokesperson said: “Ministers have no involvement in deciding who is awarded
contracts and no contracts were awarded to LFI Diagnostics.”END
Mone and
Barrowman did not respond to a detailed request for comment from the Guardian
in relation to LFI Diagnostics, PPE Medpro and the companies’ relationship with
the Knox family office.
Last month,
in response to questions about her receipt of PPE Medpro profits, a lawyer for
Mone said: “There are a number of reasons why our client cannot comment on
these issues and she is under no duty to do so.”
A lawyer
who represents both Barrowman and PPE Medpro said last month that a continuing
investigation limited what his clients were able to say on these matters. He
added: “For the time being we are also instructed to say that there is much
inaccuracy in the portrayal of the alleged ‘facts’ and a number of them are
completely wrong.”
NEWBethell
did not respond to a request for comment.END A spokesperson for Hancock said
that he had given the Covid public inquiry access to all his emails and
messages, when requested by parliament. He claimed: “The Michelle Mone story
proves the government was reasonable and shows that ministers refused to be
pushed around.”
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