He dug up the truth about where millions of their money went

Hey there,

I’ve got a terrific story for you this week that came out of my own newsroom, the Bureau of Investigative Journalism. It started with a giant spreadsheet tracking a particularly nerdy kind of loan, and since then the story has wound its way through an English council perched on the banks of the Thames, a private jet bought with public money, a glamorous Bucharest apartment, and back to the UK and the Serious Fraud Office. Now a man is being investigated for potentially stealing as much as £130m from the UK government. 

But before I get into it, if you have the time I’d really appreciate you sparing five minutes for TBIJ’s annual survey. More than 400 people have already completed it, but I do love a big round number, and reaching 500 responses would really make my week. 

(By the way, there are now almost 1,800 of you reading this newsletter – and yes, I will be celebrating when we hit the big 2,000! Thank you so much for joining me here!)

So, how did an innocuous spreadsheet reveal a multimillion-pound heist? Well, it starts with Gareth Davies, TBIJ’s Bureau Local editor, who at the time was a reporter specialising in local authorities.

In the wake of Britain’s austerity measures, councils were facing a funding squeeze and local services were on the chopping block. Inventive heads of finance were turning to risky strategies to keep money flowing, be it government loans or vast investments in commercial property. And in some cases, councils were borrowing huge amounts of money from each other.

A ream of freedom of information requests later, and Gareth had put together a spreadsheet showing the local authorities that were borrowing and lending the most. That was supposed to be the story. But one council stood out: Thurrock. It had borrowed more than a billion pounds from other local authorities, often with incredibly short turnarounds. That borrowing was far higher than the next council on the list. So Gareth dug in – and soon uncovered a strategy that was taking massive risks with public money, and could (and would) lose much of it.

Over five years, Gareth revealed that the council’s chief finance officer had poured hundreds of millions of pounds into a portfolio of solar farms run by one man: Liam Kavanagh.

Deals had been done in flashy London hotels for extraordinary amounts of money. None of the sums seemed to add up. And at exactly the same time his companies were raking in millions from Thurrock, Kavanagh was on a personal spending spree.

One of the biggest problems? The council refused to admit it had been duped. “You're alleging that the council has been the victim of what would be a very serious, extensive fraud,” remembers Gareth. “And that victim is so adamant that nothing has gone wrong, and that they can point to a regular income from the investments. They say they followed due diligence.” Even now, he talks about it with a tone of disbelief: “They’re holding public meetings to stand up and cry about how brilliant it all was.”

At every step of the way, the council fought Gareth’s efforts to get hold of more information, forcing TBIJ to take them to a tribunal just to answer a freedom of information request. Council officials didn’t want to admit something had gone wrong, even as new valuations suggested there was a £200m black hole in their budget.

“There was a point, about two years in, where it was petering out. There was clearly a very real issue, a very real reason to be concerned. But there was a missing piece there. We couldn’t prove exactly where this money had gone,” Gareth told me.

But then, a breakthrough. Gareth was able to get hold of financial records that showed money flowing out of one of Kavanagh’s companies to fund big money purchases: a yacht, a private jet, and a fully decked-out flat in Bucharest, Romania, complete with a rotating bed that cost a quarter of a million pounds. The house of cards came tumbling down.

It wasn’t without risk, particularly for one of Gareth’s sources. “Someone had turned up to their house with a big bunch of papers making very aggressive legal threats, basically threatening their entire livelihood,” Gareth said. “And we stuck by them as an organisation, supported them through the process, and eventually came to an arrangement that avoided these kinds of threats. Their reaction, on a personal level, has been the most gratifying thing, because they really put themself on the line.”

Kavanagh has always denied misleading the council and any allegations of fraud. The Serious Fraud Office is now investigating the deals. Thurrock council has also changed its tune and, in a separate action, is suing Kavanagh. Gareth is paying close attention to both cases, although he doesn’t expect either to move quickly.

He’s still to this day never been in the same room as Kavanagh. Right at the start of the investigation, Kavanagh had agreed to talk; he pulled out days beforehand, and – as Gareth later learnt – started liquidating his assets. But Liam, if you’re reading this, he’s still open to an interview.

Gareth also remembers the reaction on the ground in Thurrock, when locals finally had the full facts in their hands. The council’s debts had put key services – like the local Thameside arts complex – under threat. Now they knew why. “When the full extent of the problems was revealed they were pretty devastated by the impact of it, and felt very betrayed and misled.”

He went to a protest outside the town hall – and was greeted like a friend. It still moves him now. “Seeing, organically, our stories on posters and getting hugs from members of the public, people I’ve never met before not spoken to for the story… it was a restoration of faith, a little bit, that there’s people out there really reading stories.”

We faced many obstacles in telling this story, but we kept going because we knew how important it was. We all rely on our local councils to provide us with vital services, so TBIJ simply had to hold Thurrock to account. You could join our fight for greater transparency and support us by becoming a Bureau Insider today:

“The Thameside is our mini-Barbican in Thurrock: it’s a brutalist building and it’s not very pretty. But we love her and she’s right bang-slap in the middle of our community. She’s got our library, a museum, our precious theatre. There’s lots of community companies and charities that run out of there, and groups that use it as a regular base. It’s a safe space and a lifeline for a lot of people in our community.

Back in July of 2021, the council stated that they were going to close and sell the Thameside because it was ‘unfit for purpose and surplus to requirements’. And that was a statement that the people of Thurrock refuted. We got the ball rolling really quickly because they wanted to shut it within months. We drew up a petition. We got about 4,500 names in a matter of weeks. We spoke to the council. We wrote letters. We started a social media campaign. Within weeks we had our first protest.

We spoke to everybody that we could – but we kept hearing stories about how the council were in trouble. I started to dig and that’s when I first saw Gareth Davies’ name, and I started to read everything the Bureau had put out.

I was really shocked that the people of Thurrock didn’t know what was going on with their money. I would try to speak to people about it and I’d say, ‘You know, the council wants to get rid of the thameside, but it's because they’re in debt to the tune of over a billion?’ People would look at me and say, ‘Oh, you mean a million?’ I think then that we had about 176,000 people in Thurrock and I was trying to work out how much that was per person, that we were in debt.

I started to go to all the council meetings, everything that I could to soak up this information. I can’t tell you how many times the debt question came up and how many times the officers and the members denounced these questions, saying how well their investments were doing and how lucky we were as a borough, even patting each other on the back for doing such a great job.

They were almost talking down to the residents as if we simply didn’t understand. It was just crazy and wrong on so many levels.

We really needed an outsider to say, ‘Hey, this is madness, but you’re not the mad ones.’ So in that respect, [Gareth] watching and reporting when nobody else seemed to care was incredibly empowering for us.

We, the people of Thurrock, suffered the loss. My grandchildren will be paying that money back. We’ll be having a whole lot less. We'll be paying a whole lot more. That’s what’s really sad about this whole situation. Thurrock is a working class borough, and quite a small borough, and this is huge sums of money. So when it comes to Save Your Thameside, we were like, ‘This is an injustice and this shouldn’t be taken away from the people.’

We kept having meetings with anybody who would listen. The council councilors from the ruling party back then would, I’m not joking, openly laugh at us in meetings. In a few meetings they were rude and aggressive. I think we were drawing people's eyes to something that they really wanted to cover up. They kept pumping out: ‘Don’t listen to the press, don’t listen to these journalists.’

But we kept on fighting. We got a little charitable company called Thurrock International Celebration of Culture, made up of people from all different aspects that were linked to the Thameside. We joined together with a community interest company, Thurrock Lifestyle Solutions CIC (TLS), to put together a letter of interest to say ‘We want this building to be for the people and run by the people’. Then we started putting together a business plan.

When the voting came up in May 2023, the council changed to a different party who were more receptive to our business plans and were more interested. Now we’ve got to a point where we have created a Charitable Incorporated Organisation called Tact – the Thameside Arts and Culture Trust. That was just agreed within the past four or five weeks. If we do take the Thameside over, we’ve got TLS, who would hold the Thameside in trust for the people, and Tact would operate the complex.

It’s been every day, this campaign is every day. It got messy over periods of time, and the council dragged their feet on it, but it kept the building open. That’s a massive victory for us.

When I talk about Gareth, I remember something about how an investigative journalist is like a skilled detective and a persistent researcher and a historian. His persistence and determination was second to none. I know the battles that we’ve had with the council and I know he must have been knocked back so many times over. But he just kept going. So, I take my hat off to him because without him, the truth and the details of this miscarriage of justice would probably never have come out. He’s shone a light on something that should never have been happening with our money. And I think the people of Thurrock are grateful for that.”

You can follow the Save Your Thameside campaign, which is still ongoing, on Facebook here

I love hearing about campaigns like Sam’s, where communities rally around what matters most to them. If you’ve got a story like that, I’d be so happy to hear it. 

Take care,