Pyramid of Lies: The Prime Minister, the Banker and the Billion Pound Scandal

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And so they're kind of leaning on each other. And if you take one -- takes the other away, then it all collapses. At Greensill Capital, absolutely Lex and the other executives know that this is a problem. They discuss it all the time in management meetings, how are they going to kind of get out of this problem. Lex being the optimist at all these management meetings will say, leave it to me, I've got it sorted, we'll outgrow this. Of course, they couldn't. DUNCAN MAVIN: That's a great question. So I -- yes, you're right, I've been following this for probably about 4 years now, maybe a little longer than that. And at the time -- I've been a financial journalist for a long time. I was a chartered accountant before that. So just so you know where I'm coming from. But at the time, I wasn't writing an awful lot. I was doing a bit more editing and managing people. And a source -- a longtime source of mine came to me and said, hey, are you paying attention to this company called Greensill Capital? And I said, no, never heard of them. DUNCAN MAVIN: Yes, sure. Yes, he comes across that very early on in his career. So in his early 20s, in Australia actually working for a businessman there who had ideas about supply chain finance and the technology that could really sort of drive supply chain finance at that time, and he sort of developed his ideas around it through his career in Morgan Stanley and Citigroup and also working for the U.K. government as an adviser there. Before his successful switch to politics, Mr Johnson enjoyed a lengthy career in journalism. But an auspicious start met its first hurdle when Mr Johnson was fired from The Times’ trainee scheme in 1988 for making up quotes.

When I started to look into it based on this documentation I received, I realized Greensill was the story. And it didn't really take an awful lot of digging to figure that out. Johnson ran the Spectator as he ended up running the London mayoralty. He presided, but as far as day-to-day matters were concerned, relied heavily on his deputy, Stuart Reid, not least to make sense of an often chaotic commissioning process where some writers were left wondering if pieces urgently demanded by Johnson would ever be published. And there would be some sort of implausible excuse given. A very, very difficult firm to deal with. And I suppose that was probably one of the biggest red flags, right, that if somebody is so desperate not to tell you the truth, not to answer your questions, even questions which seem pretty straightforward, then that's a real red flag. If you've got a genuine business that's genuinely growing faster that is being done in a very honest and well organized and well structured way, then you're probably fine answering difficult questions from journalists. But if you've got a business which fundamentally is not doing what it's supposed to, then that's always going to be a difficult relationship.It just became too big. And such a major part of Greensill's business was heavily reliant on what Sanjeev Gupta was up to. And that business now is under investigation by the SFO in the U.K. And so clearly, there was a problem there. The past few months have proven difficult for the Prime Minister, with Mr Johnson forced to face a series of lobbying scandals within his own party that refreshed accusations of “Tory sleaze”. Pyramid of Lies charts the meteoric rise and spectacular downfall of Greensill and his company. He had a simple idea – democratising supply chain finance – and disrupted a trillion dollar industry in the process. But a staid business model concealed dubious practices as Greensill made increasingly risky loans to fraudulent companies using other people’s money.

Mr Johnson initially defended Mr Paterson, before later admitting the move had been a “total mistake”. However, he dismissed claims that it constituted a party, insisting that the gathering was a “work event” and that he only stayed for 25 minutes. Pressed on the issue during a Q&A session with journalists, Mr Johnson said: “I didn’t say anything about Turkey in the referendum … Since I made no remarks, I can’t disown them.” Wallpapergate Carrie Symonds was reportedly horrified at the ‘John Lewis furniture nightmare’ left behind by the Prime Minister’s predecessor, Theresa May, though she has denied the claims (Photo: Reuters) The opportunity to indulge such fantasies seems a long way from the likely day-to-day tasks and responsibilities of a prime minister – and some former associates wonder whether he is cut out for the job. NATHAN HUNT: The book, once again, The Pyramid Of Lies: Lex Greensill and the Billion-Dollar Scandal. Duncan, thank you for joining me today on the podcast.

Pyramid of Lies: The Prime Minister, the Banker and the Billion Pound Scandal

And I think they looked at Lex Greensill and said, yes, this guy -- there's some challenges with this guy. Yes, he tends to double down on risky things. He tends to make every loan we can rather than be a bit more discerning. But that's our job, right? Our job is to invest in these people and then shape them the way that we think they should be running their businesses. In this case, they couldn't do that, right? And so that was an error on their part. That's my view anyway. Duncan Mavin of Dow Jones joins the Essential Podcast to talk about his new book "The Pyramid of Lies: Lex Greensill and the Billion Dollar Scandal". Duncan discusses Greensill Capital and its collapse, which damaged the reputations of a former U.K. Prime Minister, prominent venture capitalists, and Credit Suisse. He also talks about the bizarre experience of reporting on a company where the red flags were obvious, and yet thoroughly ignored by investors. What distinguishes the Greensill saga from other corporate scandals such as the Guinness share-trading fraud of the 1980s or Robert Maxwell's misappropriation of pension funds is the way in which it encompasses, and taints, figures from the highest levels of politics and officialdom, most notably David Cameron and the former Cabinet Secretary Jeremy Heywood. The Essential Podcast from S&P Global is dedicated to sharing essential intelligence with those working in and affected by financial markets. Host Nathan Hunt focuses on those issues of immediate importance to global financial markets—macroeconomic trends, the credit cycle, climate risk, ESG, global trade, and more—in interviews with subject matter experts from around the world.

When the victims started comparing notes, they realized the basis of this scam was implausible,” said Lovell, referring to the sheer volume of tractors Gentry would have needed to sell to justify what he promised investors. “The victims can see in hindsight how ludicrous it was to believe that this scheme was true.”Mr Johnson’s early dismissal from The Times and his scandal while at The Telegraph did little to thwart his steady rise in journalism, with the writer becoming editor of The Spectator in 1999. Pyramid of Lies charts the meteoric rise and spectacular downfall of Lex Greensill and his company. He had a simple idea that disrupted a trillion dollar industry and drew in Swiss bankers, global CEOs, and world leaders, including former British Prime Minister, David Cameron. But a staid business model concealed dubious practices, as Greensill made increasingly risky loans to fraudulent companies using other people’s money.

NATHAN HUNT: Duncan, you've been following the Greensill story for years. I'm wondering how early did you know that this story wasn't going to end well? Johnson in Liverpool after being sent to Merseyside to apologise for a leading article in the Spectator. Photograph: Martin Argles/The Guardian The future Prime Minister, then aged 23, is said to have “invented” a comment from a distinguished Oxford don, historian Colin Lucas — who happened to be his godfather.

But in 2019 Mr Collier refreshed calls for Mr Johnson to apologise. Asked about the politician’s claim the conversation was a joke, Mr Collier told The Guardian: “I didn’t treat it as a joke… I warned my wife to be careful about who she answered the door to. I took it seriously at the time and it concerned me. I was worried, certainly worried enough to put my wife on a warning.” Misrepresenting the people of Liverpool