Naomi Larsson 31 October 2018

Council hits back at 'illegitimate' loan claim

Newham LBC has denied claims that decisions to enter into controversial high-interest loans were illegitimate.

A report from campaign group Research for Action suggested the council’s debt incurred by Lender Option Borrower Option (LOBO) loans was illegitimate and some loans were illegal.

In 2015 it was revealed 240 councils had taken out £15bn in high-interest LOBO loans, with claims that local government officers did not understand the risks involved.

Fanny Malinen, of Research for Action, said: ‘Every year millions of pounds are flowing into the financial sector to service loans that councils were tricked into.’

However, a spokesman for Newham, which has the most bank debt of all UK local authorities, said: ‘Decisions taken at the time to enter into these loans were legal and not illegitimate as the report suggests, but this administration has serious concerns regarding the mis-selling of LOBO loans and manipulation of the London Interbank Offered Rate (LIBOR) rate by Barclays and potentially other banks.’

Newham added the Chartered Institute of Public Finance and Accountancy (CIPFA) was ‘looking at ensuring the council’s budget is robust and how the council can increase transparency and accountability, including ensuring members are even more involved in decision making’.

SIGN UP
For your free daily news bulletin
Highways jobs

Accountant

North East Lincolnshire Council
NJC39 - £48,710
This is a pivotal position within the council’s finance team North East Lincolnshire
Recuriter: North East Lincolnshire Council

Communications and Engagement Officer

Royal Borough of Greenwich
£44,331 - £47,532
We’re looking for two enthusiastic and dedicated communications professionals to join our team and work on communications for transport. Greenwich, London (Greater)
Recuriter: Royal Borough of Greenwich

Families Information Officer

Royal Borough of Greenwich
£38,934 - £40,755
The Greenwich Families information Service is requiring cover for maternity leave within the team. Greenwich, London (Greater)
Recuriter: Royal Borough of Greenwich

Finance Assistant

Royal Borough of Greenwich
£31,524 - £32,931
Roles have generic job descriptions across the department’s full range of accounting services. Greenwich, London (Greater)
Recuriter: Royal Borough of Greenwich

Housing Assurance Service Manager

Kirklees Metropolitan Council
£55,675 - £56,649
We’re building a brand-new assurance team in our Homes & Neighbourhoods service Kirklees, West Yorkshire
Recuriter: Kirklees Metropolitan Council
Linkedin Banner