Ethical Bankers

I am, so I'm told, banking with the Co-op Bank these days because for many years I had an account with the Britannia Building Society which ran into trouble during the great financial crash - and merged with the Co-op to avoid the chill winds of the recession.

In the event the Co-op has also had to 'demutualise' which means that instead of being owned by its customers (savers and borrowers) - control of the bank has now passed into the hands of private shareholders who will presumably run it along the same lines as other commercial lenders.

Now if I remember correctly, my old colleague from NUPE days, Tom Sawyer, used to be a director of the Britannia Building Society - Tom having acted as NUPE's deputy general secretary before going on to become the Labour Party's general secretary for a spell following which he was rewarded with a peerage and seat in the House of Lords.  

What a funny old world we live in these days and the latest twist is that Paul Flowers - the disgraced former chairman of the Co-op Bank - has strong Labour Party connections as well as being a Methodist minister.         

Co-operative Bank's former chairman shown handing over cash for drugs

Methodist minister Paul Flowers seen in video counting out money to buy substances, while texts discuss drug taking

Paul Flowers is shown in a video handing over cash to buy illegal drugs. Photograph: /Co-operative Banking Group

The Co-operative Bank's former chairman Paul Flowers bought illegal drugs including cocaine, crystal meth and ketamine, according to a newspaper investigation based on video footage showing the clergyman handing over money for the purchase of illicit substances.

Flowers, a Methodist minister, is shown sitting in a car counting out £300 in cash. The Mail on Sunday said an acquaintance handed over the footage, said to have been taken days after Flowers gave testimony to the Treasury select committee over the bank's £700m in losses and its abandoned bid to buy branches of the bailed-out Lloyds Bank.

The paper said friend Stuart Davies handed over the video and a series of incriminating text messages after becoming "disgusted by the hypocrisy" of a man who had chaired the anti-drugs charity Lifeline and written columns about the evils of drug use.

One of the texts said: "I was 'grilled' by the Treasury select committee yesterday and afterwards came to Manchester to get wasted with friends."

After being confronted with the material Flowers issued a statement: "This year has been incredibly difficult, with a death in the family and the pressures of my role with the Co-operative Bank. At the lowest point in this terrible period I did things that were stupid and wrong. I am sorry for this and I am seeking professional help and apologise to all I have hurt or failed by my actions."

The Co-operative Bank said it had no comment, while the Methodist church said a "thorough investigation" would take place under its "procedures for when ministers fail to meet standards".

Flowers on 7 November tried to spread the blame for the bank's woes, telling the select committee that politicians had actively encouraged the Co-op Bank's expansion spree involving an ill-fated attempt to buy 631 branches from the Lloyds Banking Group.

The bank also disastrously took over the Britannia building society, a deal that brought with it a raft of bad loans.

Flowers said he had resigned as chairman in June 2013 to take responsibility for a £1.5bn capital shortfall that left the Co-op group having to demutualise the 100-year-old bank and hand a 70% share in the British institution to a group of bondholders involving US hedge funds.