DFB management accused of lies and cover-up

THE management of Dairy Farmers of Britain (DFB) lied to its members and hid the true scale of its financial problems from its member council before it went into administration last year, a committee of MPs has been told.

Speaking at the Environment Food and Rural Affairs (Efra) enquiry into DFB’s collapse, former council chairman Stephen Yates launched a stinging attack on the co-op’s former management.

He said former chairman Rob Knight was ‘not up to the job’ and said he regretted not scrutinising Mr Knight’s appointment further when it was put before the member council.

He said: “I’m aghast that we accepted it then, but we did. We took it as read that this man was capable of running the business but then I look back over his CV and realise he’s never run anything other than a bath in his life.”

He accused the Board of covering up information on the firm’s finances, and claimed they tried to stop council talking to its auditors in case they found out the true scale of its problems.

He said: “They tried to stop me meeting with the auditors because they realised they were giving me information outside of the company accounts.”

He said the council – whose role it was to inform farmer members of developments in the business – was not kept informed of the state of the Co-op’s finances.

He said: “In March 2008 the board came to council with a proposal to pay a dividend to the members. Then in June they increased the milk price by 0.5ppl.

“So there were clear signals that all was well with the business. We were told we were a business on track but within six weeks the bank had issued a letter to the board that caused absolute mayhem.”

05 February 2010