Jim Armitage: De La Rue’s boss may get passport through exit door

For the first time in the blue passports farrago, De La Rue has done the right thing: it will drop its petulant appeal against the government for awarding the contract to a cheaper bid from a French rival.

But now it seems likely another French firm will take over the whole company.

What will the Brexiteers make of that?

Chief Martin Sutherland’s decision to stop bleating about the UK contract goes some way towards redressing the absurdity of his earlier implication that, despite De La Rue working for countless countries around the world, foreigners should not be allowed to compete with it at home.

But his announcement was combined with a profit warning that leaves De La Rue looking dangerously vulnerable.

The smart money has it that Paris-based Oberthur may come in with a bid. Oberthur offered 935p a share a few years back but was rebuffed by De La Rue’s management, who trumpeted its glorious independent future. Today, it’s trading at 467.5p.

And how bad has communication with investors by De La Rue been lately?

First, just before losing the UK passports bid, it issued a statement warning profits could be at the lower range of City forecasts (around £71 million).

Then it apparently told investors privately it may have been overly pessimistic.

Now, a couple of weeks later, it says earnings could be as low as £61 million. In a statement with a clumsy grammatical error to boot .

How long before shareholders do a Windrush job on Sutherland’s passport and reject his right to remain?

Wrong to dither over Beaufort

No regulator will ever make the City entirely safe. But the Financial Conduct Authority has failed in its duty to protect UK clients of the doomed Beaufort Securities.

Beaufort was the stockbroker shut down by the regulator last month. The FCA was right to act, but delayed stepping in by weeks, possibly months, despite apparently knowing all was not right.

Why? Because its peers in the US were probing fraud allegations, and asked the Brits to let the situation play out until they had enough evidence to swoop.

This resulted in a Beaufort man and a Mayfair art dealer being charged, but also meant people were giving Beaufort their money long after regulators knew all was not well.

Today it emerges that those investors will get back £300 million less than the £850 million they’d been hoping for. The 700 who had more than £150,000 invested will lose money.

You can see why the FCA held back; suspected criminal activity should be pursued to conviction, but it is entirely unfair to keep investors with substantial sums at risk in the dark.

Doubtless those wealthy individuals nursing losses will be sending their lawyers in the FCA’s direction.