A meeting was held in London on Wednesday with lawyers to discuss how Carlex should proceed with the Peverel / Cirrus price-fixing scandal.
Also, the Office of Fair Trading is under scrutiny at the highest level for cutting a leniency deal with Peverel, ostensibly because Peverel turned itself in in December 2009 by admitting the false tendering process that won Cirrus thousands of pounds of contracts for electronic door-entry and warden-call services.
Carlex can demonstrate that it had been in contact with the OFT, the Serious Fraud Office and Trading Standards months before December 2009 over a number of abuses.
Energy Secretary Ed Davey states that he raised issues with the OFT before December 2009 and the Times newspaper reported in detail the Cirrus tendering scams on December 4 2009.
At some point between December 4 and December 22, Peverel admitted the price-fixing involving Cirrus. The full Carlex dossier on the practice was sent to the OFT in January 2010.
A month before turning itself in, the then Peverel chief executive Nigel Bannister was quoted in the Times:
“People are reading a conspiracy into a problem that isn’t there. We use Cirrus because it is an excellent service.”
Carlex has requested that the prime minister call a meeting between the Department of Communities and Local Government and the Ministry of Justice for the OFT to explain itself.
The move is backed by Sir Peter Bottomley.
A meeting with Carlex, Sir Peter, Ed Davey and other politicians is set for Tuesday next week.
From the OFT’s point of view, it is far more tidy and less labour intensive to go along with the fiction that Peverel admitted the price-fixing scandal and investigate on that basis.
The Carlex whistleblowers, who for three years have kept the investigation confidential, feel utterly betrayed by the OFT’s accommodation with Peverel, and the leniency deal.
As with exit fees, which it regards as an unfair contract term, the OFT has shown itself to be feeble and dilatory in handling scandals in the retirement leasehold sector.
Politicians want an explanation why the investigation has taken so long given that Peverel was co-operating with inquiries.
The key question at Carlex’s meeting with lawyers – at which two of the three original Carlex whistle-blowers were present – is: how to get Peverel / Cirrus to pay back the money it wrongfully took from pensioners.
Peverel / Cirrus ran the bogus tendering process – where stooge companies put in higher tenders than Cirrus, making its proposal the most attractive on price – at sites where the contingency funds were sufficiently large to pay for the work.
Carlex will therefore have to litigate to get the money paid back.
To do so it is vitally important that residents at sites where Cirrus carried out these works between 2005-2009 make themselves known.
The case can then be taken to the Competition Appeal Tribunal for a ruling.
Carlex has secured the pro bono backing of a major firm of London solicitors, and is confident that in this case it will have no difficulty securing the services of barristers as well.
The full OFT report is expected in September / October.