Scandal-hit Co-op Bank to face independent probe

Associated Press SHARE

By SYLVIA HUI, Associated Press

LONDON (AP) — Britain's prime minister said Wednesday the ailing Co-operative Bank will face an independent inquiry into the role of its former chairman, a minister who was filmed allegedly buying crystal meth and other drugs.

Paul Flowers, a Methodist minister who led the bank for three years until he stepped down in June, has apologized after footage of him allegedly buying drugs emerged this week. The Mail on Sunday reported that he bought crystal meth, cocaine and ketamine just days after lawmakers grilled him on the bank's disastrous finances.

Prime Minister David Cameron told lawmakers Wednesday that "many questions have to be answered" regarding the Co-op Bank, including why Flowers — who he said had "driven (the bank) into the wall" — came to be appointed as its chairman in the first place.

"Why was Reverend Flowers judged suitable to be chairman of a bank? Why weren't alarm bells ringing earlier, particularly by those who knew?" Cameron asked.

The Methodist Church said Wednesday that Flowers had been suspended indefinitely from his post as minister.

Flowers, 63, is already under police investigation in relation to the allegations. It has also emerged that he was found to have downloaded "inappropriate" adult images on his work computer when he was a local official for the Labour Party in 2011.

Len Wardle, the chairman of the Co-operative Group, Britain's largest mutual society, quit Tuesday as the scandal grew. The group's governance had already been under scrutiny in the wake of troubles that emerged following its 2009 acquisition of the Britannia Building society and its aborted interest in the purchase of some 630 branches from another U.K. lender, Lloyds Bank.

The bank has had to plug a 1.5 billion pounds ($2.4 billion) black hole in its finances and recently agreed to a bailout plan by hedge funds.

Copyright 2013 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.