Norman Lamb MP, Liberal Democrat shadow treasury minister, demanded Connolly step down after a national newspaper published a story critical of him on Monday.
‘In terms of restoring confidence, both generally and in terms of Deloitte, it seems to me that Mr Connolly’s position is no longer tenable. For someone in charge of its UK operation to have been so heavily criticised by a financial watchdog seems extraordinary,’ he said.
A story in The Independent highlighted Connolly’s role in the 1980s Barlow Clowes affair, during which elderly investors lost their life savings. The government paid £150m to 18,000 investors as a result.
The paper pointed to a 1995 report by the accountants’ Joint Disciplinary Scheme into the scandal, which claimed Connolly had lacked competence. The report said Connolly ‘fell below the standard which should be displayed by and may properly be expected of a chartered accountant’.
It focused on Connolly’s role in a reverse takeover in which Barlow Clowes was sold to a company called James Ferguson. Connolly was responsible for providing accurate financial data about Barlow Clowes to James Ferguson shareholders. The report ordered that Connolly pay £40,000 in costs and that he be officially reprimanded.
Deloitte said: ‘This refers to a piece of work carried out back in the eighties and the findings of the JDS report have been in the public domain now since 1995. It is not an issue we feel it is necessary to comment on.’
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