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Today in history… Poulson scandal uncovers corruption

12:00am & Lifestyle

John Poulson, founder and head of a firm of architects which had become one of the biggest in Europe, was jailed for corruption and bribery on March 15th, 1974.

The scandal exposed by the Poulson investigation and trial was far-reaching and implicated many high-profile public figures, including several MPs. The court case, lasting 532 days and costing £1.25m (around £12.4m in today’s money), exposed a web of corruption in which lavish gifts and ‘consultancy fees’ were used to help win lucrative contracts.

Leeds Crown Court was told that the 63-year-old Yorkshire-based architect gave away more than £500,000 (almost £5m today) in suits, holidays, flowers and other inducements to win contracts for his firm. It had offices in London, Middlesbrough, Newcastle, Edinburgh, Beirut and Nigeria prior to its spectacular collapse in 1972. Many of the contracts it won were for taxpayer-funded projects awarded by councils, local authorities and nationalised industries, where Poulson had cultivated a network of contacts.

A self-made man and workaholic, Poulson consistently denied the charges against him, admitting that cash or presents had changed hands but insisting they were gifts to friends and business associates, or legitimate consultancy fees, rather than bribes. The nub of the legal case was whether the gifts were made with no expectation of anything in return, or whether they were inducements to award contracts and rewards for doing so, which those involved in the process knew was wrong.

At the end of the lengthy court case, which involved 100 witnesses and 500 exhibits, Poulson was found guilty of conspiracy to make or receive corrupt gifts and jailed for five years. The sentence was later increased to seven years after Poulson pleaded guilty while in prison to nine further charges of corruption and conspiracy, instead of facing a second trial.

The investigation into Poulson’s affairs began after his firm collapsed with huge debts. It revealed that his businesses made payments to several MPs, police officers, civil servants and health authority officials who were in a position to make or influence decisions on awarding contracts. Several of Poulson’s contacts were also prosecuted, but not the MPs because a legal loophole meant they could not be considered ‘in charge’ of public funds.

However, the affair did bring about the resignation of Home Secretary Reginald Maudling. He had been chairman of one of Poulson’s companies, at £5,000 per year, while his son was employed by another Poulson enterprise and a charity patronised by Maudling’s wife received large donations from Poulson. Political opponents accused Maudling and other MPs of using their influence in Parliament to support and promote schemes in which Poulson had a financial interest.

The judge in Poulson’s trial, Mr Justice Waller, said the web of corruption encompassed 23 local authorities and at least 300 individuals. Chief among them was 57-year-old senior Scottish Office civil servant George Pottinger, who had received gifts from Poulson worth £30,000 over a six-year period. The jury found it was no coincidence that Poulson was appointed architect in charge of a £3m redevelopment of the Aviemore winter sports complex. Pottinger, who was in charge of the Aviemore project, was convicted alongside Poulson.

Passing sentence, the judge told the two men that “the magnitude and evil nature” of what they had done was such that he could not take into account their age or health: “To offer corrupt gifts strikes at the very foundation of our system,” he said. “To accept them is a betrayal of trust.”

Poulson continued to protest his innocence, portraying his gifts as common practice in business and part of ‘public relations’: “I may have been a fool but I will always maintain that I was innocent of corruption,” he said. “I have never tried to bribe anybody.”

During the trial he also said: “I have squandered money on people I thought were my friends. They conned me. I did not realise what an old twit I had been until I heard some of the evidence here.”

After sentence was passed, Poulson’s lawyer Donald Herrod QC said of his client: “He has nothing to live for and his abiding fear is that he will never complete this sentence because of his ill health.”

It was that ill health that saw Poulson released from prison just over three years later, in May 1977, after politician and reformer Lord Longford interceded on his behalf, saying it was an “indefensible cruelty” to keep a sick man in jail. In fact, Poulson lived another 16 years, dying in hospital in January 1993.

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