All three were directors of companies within the Fourfront Group at the time that the illegal cartel activity took place.
Clive Lucking, founder and CEO of the Fourfront Group, has been disqualified for four years and nine months. Aki Stamatis, chair of the Fourfront Group, has been disqualified for two years and nine months and Sion Davies, managing director of Area Sq. Ltd, has been disqualified for one year and six months.
Clive Lucking contributed to 10 breaches affecting contracts with a total value of over £11.9m. Aki Stamatis contributed to one of these breaches and took no steps to avoid the other nine breaches even though he had reason to suspect or should have known about them. Sion Davies contributed to the illegal conduct by failing to prevent three breaches affecting contracts with a total value of £8.6m.
In March 2019 five companies agreed to pay fines totalling £7m after the CMA found that they had broken competition law by engaging in a form of collusive tendering known as cover bidding. Typically, cover bidding involves companies, when bidding in a competitive tender for a contract, agreeing with each other that one or more of them will place a bid that is deliberately intended to lose the contract, thereby reducing the intensity of competition. This can lead to customers paying an artificially inflated price or receiving poorer quality services than if the companies had competed properly in the tender process. The five companies involved were: Fourfront, as well as JLL, Loop, Coriolis, ThirdWay and Oakley. [See our previous report here.]
The whistle was blown by Jones Lang LaSalle (JLL), which acquired fit-out firms Bluu Solutions Limited and Bluuco Limited in 2015 and discovered what had been going on. JLL was let off a fine under the CMA’s leniency programme.
In May this year, the CMA secured legally binding disqualification undertakings from Robb Simms-Davies (former director of JLL group of companies), Trevor Hall (former director of Cube Interior Solutions Ltd, part of the Fourfront Group) and Oliver Hammond (former director of Area Sq. Ltd, part of the Fourfront Group).
Clive Lucking, Aki Stamatis and Sion Davies initially declined to give disqualification undertakings but have now done so after the CMA put them on formal notice of its intention to apply to the court for disqualification orders against them. Had they given undertakings before the CMA issued the formal notice, their disqualification periods would have been shorter. Giving an undertaking means they agree to be disqualified from being a director of a company, or otherwise being involved in the management of any UK company, unless they have the permission of the court.
These undertakings will take effect on 7th October 2019. This allows the directors time to apply to the court for permission to carry out specified director duties. Whether or not any such application would be successful is a matter for the court, having heard representations from the directors and from the CMA.