Former boss of Carillion banned by Insolvency Service from leading a business for eight years

The former chief executive “ought” also to have known of the “false accounting, of the profit overstatement and of the net debt understatement and of the concealment from the auditors” around what payments Carillion was obliged to make to Wipro, a consultancy.

He also signed off on a £54.4m dividend, which was paid in June 2017, but “could not be justified by reference to the … financial statements”, the Insolvency Service said.

“Mr Howson ought to have known that the 2016 final dividend payment was not in the interests of Plc, its members or its creditors and was not one that Plc could reasonably afford to make in view of its true financial performance.”

Carillion issued a profit warning just a month after the dividend was paid out to shareholders.

Less than a year later, the firm – which employed around 12,000 people – collapsed.

Mr Howson is not the first to be suspended. This summer former finance boss Zafar Khan was banned from being a director for 11 years.

An Insolvency Service spokesperson said: “The Insolvency Service, acting on behalf of the Secretary of State for Business and Trade, has accepted a disqualification undertaking from Richard Howson for eight years for his conduct as a director of Carillion Plc.

“This follows the disqualification undertakings the Insolvency Service accepted from Zafar Khan on June 29 and from Richard Adam on July 13.

“As the litigation against the remaining directors is ongoing, with a trial set to commence the week of October 16, we are unable to comment any further.”

The Insolvency Service is a Government agency that helps to deliver economic confidence by supporting those in financial distress, tackling financial wrongdoing and maximising returns to creditors.

The Insolvency Service is an executive agency, sponsored by the Department for Business and Trade.