Highlights
- Richard Adam fined £232,800 and Zafar Khan fined £138,900 for reckless conduct.
- Pair aware of financial problems but failed to inform Board, audit committee or market.
- Fines follow withdrawal of challenges after FCA found Market Abuse Regulation breaches.
The Financial Conduct Authority has fined two former finance directors of collapsed construction giant Carillion a total of £371,700 for their roles in issuing misleading market statements.
Richard Adam and Zafar Khan were both aware of serious financial troubles in Carillion's UK construction business but failed to reflect this in company announcements or alert the Board and audit committee, the regulator found.
Adam, who served as finance director from April 2007 to December 2016, received a £232,800 fine. Khan, who held the role from January 2017 to September 2017, was fined £138,900. Both withdrew their challenges to the FCA's decision.
The FCA determined that as finance directors, the pair had responsibility for Carillion's procedures, systems and controls relating to financial reporting.
These were insufficient to ensure contract accounting judgements made in the UK construction business were properly made, recorded and reported.
Regulatory findings
The regulator found both men acted recklessly and were knowingly concerned in breaches by Carillion of the Market Abuse Regulation and Listing Rules.
Steve Smart, joint executive director of enforcement and market oversight at the FCA, said "Those in positions of responsibility have a duty to keep the market accurately and adequately informed.
With Carillion, we have seen the serious impact it can have when they don't. The action taken against Mr Adam and Mr Khan demonstrates our commitment to preventing market abuse and upholding the standards we expect."
The breaches included disseminating information that gave false or misleading signals about share value, failing to ensure announcements were not misleading, and not maintaining adequate procedures and controls for Listing Rules compliance.
Carillion's former chief executive Richard Howson also received a Decision Notice regarding related findings, which he disputes. His Upper Tribunal hearing is scheduled to begin on 16 February 2026.
