Throughout the stunning interviews the Conservative peer Michelle Mone gave last month, finally admitting she had lied for years when denying her involvement in lucrative PPE deals, she still maintained a claim central to her remarkable rise. Hands neatly placed in her lap, she was, she told the BBC’s Laura Kuenssberg, a “very successful individual businesswoman”.
Mone and her husband, the Isle of Man-based businessman Doug Barrowman, are facing a long-running National Crime Agency investigation into allegations of bribery and fraud in their securing of £200m in government contracts for a company, PPE Medpro. Both now admit involvement in the company, but deny any wrongdoing.
It is telling that the couple, in complete contradiction to their previous aggressive legal denials, are now claiming it was Mone’s business experience and contacts that enabled them to deliver PPE.
“I’ve got 25 years’ manufacturing experience, and that’s one of the reasons why I was put into the House of Lords,” Mone told Kuenssberg in December. When Covid hit, she said: “I looked at Doug and I thought, we could really, really help here. And I just know all the key players in the far east. And I made the call to Michael Gove.”
Barrowman, who also took part in the BBC interview, had made a similar claim in a film paid for by PPE Medpro that was released on YouTube a week earlier. “Michelle and I looked at each other one day and said, you know, we have strong contacts … in the far east,” he said. “Essentially, Michelle reached out to her contacts, we formed a consortium venture with a company based in Hong Kong and a company based in the UK.”
Analysis of documents, however, raises questions about whether Mone really did use her contacts in the far east, as is now claimed – or whether her role was principally to exploit her Tory political connections to secure those lucrative contracts.
Her claims about her level of success as a businesswoman have also been disputed. Her company had been heading into insolvency and needed to be rescued shortly before she was given a peerage.
And with David Cameron back in government, having himself recently been made a member of the House of Lords, there is a clear connection between the peerage he gave Mone in 2015 and the PPE Medpro “VIP lane” scandal damaging the Tories on voters’ doorsteps.
Hong Kong and the consortium
Mone made the first approach on behalf of PPE Medpro to the ministers Michael Gove and Theodore Agnew in May 2020, offering to supply PPE through “my team in Hong Kong”. Her offer was fast-tracked through the government’s “VIP lane” for politically connected people, and within weeks the newly formed company had been awarded two contracts worth £203m.
Later, the Guardian revealed that leaked bank documents indicated Barrowman – who at the time was still denying any involvement – had been paid at least £65m from PPE Medpro’s profits. He had then transferred £29m into a trust, of which Mone and her three adult children were beneficiaries.
In the BBC interview, Barrowman finally admitted he had made multimillion-pound profits. Not mentioned, however, was that three other companies had been involved in the supply of the PPE, and, according to a Guardian analysis, had shared a further £30m in profit. One of these companies had been paid a large fee to make an introduction to another company in Hong Kong.
Files leaked to the Guardian revealed the structure of the operation. PPE Medpro had entered into an agreement with a separate company, which had committed to supply the PPE. In this agreement, PPE Medpro stated that its role was to use its “extensive network” to secure contracts from the British government. The Guardian has repeatedly asked Mone and Barrowman whether that was a commitment to use Mone’s political connections with Tory ministers. They have never replied directly to that question.
It was the other company, London-based Loudwater Trade and Finance Ltd, whose role was to “manage and secure the supply chain of key PPE items from China and abroad”.
Loudwater in turn contracted with another company, Neumer Trading, for an introduction to the company in Hong Kong, Eric Beare, which bought the PPE from factories in China. Loudwater, Eric Beare and Neumer Trading have declined to comment.
After their broadcast interviews, the Guardian asked Barrowman and Mone why, if the baroness “knew all the right people in the far east”, the supply chain had paid an intermediary company for an introduction in Hong Kong.
They did not respond directly to this question.
Of the PPE delivered to fulfil the two contracts, the government rejected the entire consignment of surgical gowns and is suing PPE Medpro for return of the £122m paid. PPE Medpro is defending the claim, arguing that the gowns were fit for purpose.
Mone and Ultimo
Mone’s claims of great business success, key contacts in the far east and deep manufacturing experience spring principally from her lingerie company, Ultimo, which launched her to celebrity-tycoon status nearly two decades ago.
Through the 2000s, Mone built the Ultimo company, MJM International, with her first husband, Michael Mone. They achieved commercial success, reaching a pre-tax profit of almost £1m in 2007-08. Michael Mone is widely said to have concentrated on the operations of the business, while Michelle Mone developed her talent for promoting the brand. Glamorous pictures of models, and later Mone herself, wearing Ultimo bras and underwear were splashed across the internet as celebrity culture boomed.
In August 2015, Cameron appointed Mone, who had supported the union in the Scottish independence referendum, as his “entrepreneurship tsar”, and gave her a peerage later the same month. His government’s statements promoted her image of success, lauding her as a “leading entrepreneur” and stating that “she took the lingerie brand global before the multimillion-pound sale of 80% of the business last year”.
The reality – still generally ignored, but evidenced by Ultimo company documents and a damning 2014 employment tribunal judgment – presents a rather less glittering picture. Mone does not appear to have made multiple millions of pounds from the sale of the company. In fact, the company had been heading for insolvency until it was rescued by a Sri Lankan clothing manufacturer, MAS Holdings.
From 2011 onwards, the Mones’ marriage had fractured and the company’s fortunes had plunged. Michelle Mone later went public with some of the fallout, publishing an autobiography in February 2015 that was extensively serialised in the Daily Mail. Headlines were made as Mone related that she had taken a knife to Michael’s Porsche and scratched it “to shreds”, let down his car tyres, “cut holes in all his boxer shorts” and once “slipped some laxatives into his coffee”.
The employment tribunal case, brought in Glasgow by Ultimo’s operations director, Scott Kilday, found that he had been unfairly dismissed because his office had been bugged after the MAS takeover. The judgment set out the details of MJM’s financial predicament before the takeover. By May 2012, it said, the company “was in dire financial straits … There was a real possibility that the [company] would become insolvent if it failed to find a buyer.”
Mone reached a deal with MAS, which paid her £1.3m for the company. She first had to buy more than half the shares from Michael and another small shareholder. A new company was then set up and Michelle became a director.
A key MAS director, Eliaz Poleg, became anxious that Kilday – “a vital employee” – would leave for Michael’s new business, or was leaking information to Michael, which Kilday denied.
“Mr Poleg … was keen for [Kilday] to stay as in his view he was ‘the pole that kept the tent up’,” the tribunal noted. “[Poleg] had nobody else to keep the ship afloat. Mrs Mone was not hands on from an operational point of view and Mr Mone had left the business.”
Poleg decided “with hesitation and reservation” to “place a recording device in [Kilday’s] office”. Poleg “asked [another MAS representative] and Mrs Mone to make the necessary arrangements”. Kilday discovered the device in a plant pot, “was horrified”, and immediately resigned.
The MAS takeover involved a new company being formed, Ultimo Brands International. Initially, MAS owned 51% of this new company and Mone 49%. Despite investment from MAS, Ultimo continued to make losses. By January 2015, MAS had invested more and Mone’s stake had been reduced to 20%.
When asked whether Mone had been paid for this reduction of her shareholding, an MAS spokesperson said: “MAS continued to invest directly in the company with the intention of turning the business around.” He added that the increase in MAS’s stake to 80% had been “due to the continued investment”.
Mone did not respond directly to questions from the Guardian about these financial arrangements.
Ultimo never recovered, however, and Mone’s shareholding was further diluted. She appears to have still had a small minority stake when the decision was taken in August 2018 to appoint a liquidator and wind up Ultimo.
A ‘fait accompli’ peerage
In 2015, a year after the media had reported on the Kilday employment tribunal, and just six months after the revelations in Mone’s autobiography, Cameron made her the government’s “entrepreneurship tsar”. She was appointed to lead a review for the Department for Work and Pensions (DWP) into supporting people from deprived backgrounds to set up their own businesses.
The then work and pensions secretary, Iain Duncan Smith, proclaimed himself “delighted” at her appointment, saying: “There’s no one I can think of who is better qualified.” Weeks later, Cameron appointed her to the House of Lords, with the title Baroness Mone of Mayfair.
Looking back at that period, it is striking to recall the public criticism from her native Scotland, where people knew the Mones and the Ultimo business much better than in England, where papers carried gleeful “Baroness Bra” coverage.
Douglas Anderson, the managing director of the large Glasgow-based plant hire company Gap Group, was among business figures to speak out, providing his views in a letter to Cameron. “Ms Mone is not a successful entrepreneur,” Anderson wrote. “She is a small-time businesswoman with a PR exposure far in excess of any actual success.”
David Mundell, the secretary for Scotland at the time, told the Guardian that Downing Street had bypassed convention that all proposed Scottish peerages are discussed with the Scotland Office.
“The peerage was a fait accompli by the time we heard about it,” Mundell said. “I was unhappy that the proper process was not followed and that the Scotland Office was not asked to provide any background or input. And I wasn’t at all surprised to find that Scottish businesses were very, very unhappy about the appointment.
“I did communicate with Downing Street that Scottish business figures were unhappy because they did not consider Michelle Mone to be a substantial businesswoman.”
The DWP review delivered less than Mone promised. There was some embarrassment when Mone tweeted a picture of herself on a visit to Stockport, in a chauffeur-driven government Jaguar, drying her top on the air-conditioning. “The things you do. In Government car drying my travel top,” she tweeted. “Love it so much.”
Downing Street published a report three months earlier than planned. It offered a handful of ideas to support business startups, although Cameron’s government, dedicated to austerity, offered no new funding to deliver on any of these. Mone herself stressed repeatedly that she would “continue to work in a personal capacity” to create “a nationwide network of bank-funded enterprise hubs” but that never happened. A promised “final part” of the review did not materialise.
The DWP did not answer the Guardian’s questions about its statement that Mone had sold 80% of Ultimo in a multimillion-pound sale in 2014, or about her performance on the review, or why the report had been published early.
A spokesperson for Mone, Barrowman and PPE Medpro replied to questions by saying: “Michelle Mone came from a working-class family in Glasgow’s East End and worked hard to become a successful entrepreneur, building one of the biggest independent lingerie brands in the world. She also sat on the Prince’s Trust board for many years to help the next generation of entrepreneurs. Michelle has real life experience that makes her different to your typical, grey Westminster politician.
“Michelle was honoured to be asked to join the House of Lords by David Cameron after her role in the Scottish referendum campaign. Her appointment was duly vetted by Holac [the House of Lords Appointments Commission] at the time.”
The spokesperson added: “Any suggestion that Michelle ran a successful lingerie company for many years but did not have any experience in manufacturing is laughable.”
Holac’s role is to vet people nominated as peers “for propriety”, and can withhold support if there are legal or regulatory issues such as an outstanding tax investigation.
Cameron and Duncan Smith did not respond to invitations to comment. A Cabinet Office spokesperson pointed out that all peerages are vetted by Holac.
One senior Conservative said he believed Cameron was attracted to the idea that Mone, as a young Scottish businesswoman, would give the Tories a brighter image in the House of Lords, but that he had failed to scrutinise her actual career. Five years on, when Covid hit, she was in place – a baroness swept into the “VIP lane” for untold riches.
