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Farron demands investigation into behaviour of the banks following collapse of Dairy Farmers of Britain
July 14, 2009 12:00 AM
The role of HSBC and other banks in the collapse of Dairy Farmers of Britain should be investigated by Parliament according to Liberal Democrat Shadow Defra Secretary Tim Farron, who believes the actions of the lender may have contributed to the devastating losses experienced by dairy farmers following last month's collapse of the milk co-operative.
Members of Dairy Farmers of Britain are now owed collectively around £20million after the decision to call in the receivers left members without May's milk cheques.
Mr Farron had previously expressed his concern at the deliberate timing of the calling in of the loan and has written to Defra Secretary Hilary Benn MP asking him to investigate whether the bank kept Dairy Farmers of Britain going for the specific purpose of profiting at the farmer's expense.
Commenting Mr Farron said:
"Many farmers have suggested to me that the banks - chiefly HSBC - may have deliberately kept DFB going beyond the point when the company was essentially bankrupt, in order to collect milk produced in May.
"The bank then pulled the plug at the beginning of June just at the point when the milk had been collected, but before any of the May cheques had been paid by the company.
"HSBC then gained from the sale of the milk through the normal retail chain, while the producers were left high and dry.
"I'm deeply concerned about this and hope that Hilary Benn will investigate whether the bank kept DFB going for the specific purpose of profiting at the farmers' expense."
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