Tory Treasurer set to Make Millions from LV sale

A senior figure for the Conservative Party is reportedly set to make millions from the sale of British mutual insurer LV.

Tory Treasurer set to Make Millions from LV sale f

"There should be proper disclosure"

Malik Karim, co-treasurer of the Conservative Party, looks set to make millions from the sale of British mutual insurer LV to a US private equity firm.

Mr Karim is the founder and chief executive of Fenchurch Advisory, the investment bank advising LV on the £530million deal.

LV bosses are backing the takeover by Bain Capital, and using funds of its 1.2 million members to force it through, however, they have refused to reveal the costs.

The deal is likely to be lucrative for Fenchurch, with estimates that its fees could be worth more than £5 million.

As Fenchurch’s boss, Mr Karim, who was named Tory treasurer in September 2021, is likely to benefit from it.

According to Companies House filings, Mr Karim was also a member of Ingenious Film Partners 2 between 2006 and 2011 – a controversial film investment scheme accused by HMRC of being a means of avoiding tax.

Mr Karim said he was advised to join the scheme by his financial adviser at the time and added:

“I have made all interim payments to HMRC as requested and will settle any remaining outstanding amounts once the matter is resolved.”

Other advisors set to benefit from the sale of LV include lawyers at magic circle law firm Clifford Chance and spin doctors at City PR outfit FTI Consulting.

The Daily Mail reported that the money shared by bankers, lawyers, PRs and other advisers could be close to £10million.

In 2020, AA was bought by private equity firms for less than the sale of LV, but fees to third parties were around £50 million.

The deal is shrouded in secrecy and has subsequently caused controversy.

Tory peer Baroness Altmann said:

“This is members’ money being spent to change terms for members without their say-so.

“There should be proper disclosure rather than secrecy.

“Is it because LV bosses are concerned the amount would seem inappropriate?”

Shadow chancellor Rachel Reeves said the “lack of transparency” was “troubling”, adding:

“It would be completely unacceptable if a senior Conservative were to personally profit from the potential asset-stripping [of LV].”

This comes after LV’s chief executive Mark Hartigan was accused of trying to “hoodwink” members into supporting it.

He and LV chairman Alan Cook have been criticised for failing to share details about rival bids, job security for its 1,500 staff and how much they will earn from the takeover.

Mr Hartigan is set to make millions while Mr Cook will hang on to a £205,000-a-year chairmanship for at least two years.

They have been accused of “misleading” members with claims neither will make “a penny” from the sale.

Labour MP Gareth Thomas, chairman of the cross-party group on mutuals, said it “beggars belief” that members’ money is being paid out to already “incredibly wealthy business people”.

He said: “It adds insult to injury that members are being asked to fork up their own hard-earned money to polish this dreadful deal and force it through.”

According to its board, LV concluded that the deal presents the most positive outcome for all members, the future of the LV business and its people.

Mr Karim denied any potential conflicts of interest between advising LV and his Tory Party role.

Dhiren is a journalism graduate with a passion for gaming, watching films and sports. He also enjoys cooking from time to time. His motto is to “Live life one day at a time.”