Michelle Mone-Linked PPE Firm Faces £134M Lawsuit Amid Asset Decline

The company associated with Baroness Michelle Mone, PPE Medpro Limited, is embroiled in a significant legal battle with the UK Government over a claim of £134 million. Recent financial statements reveal that the firm now has just £666,000 in assets, raising concerns about the potential recovery of funds for taxpayers if the Government prevails in the lawsuit.

According to the latest accounts, PPE Medpro has incurred £4.3 million in legal fees defending itself against the High Court claim. This financial strain amplifies the likelihood that, even in the event of a ruling in favor of the Government, little to no funds will be recoverable. The company, which gained notoriety early in the COVID-19 pandemic, was established by an associate of Mone and her husband, Doug Barrowman, and quickly secured contracts exceeding £200 million to supply personal protective equipment (PPE), including gowns and face masks.

The Department of Health initiated legal action in 2022, alleging that 25 million gowns provided by PPE Medpro were unsuitable for use by the National Health Service (NHS). Tests indicated that many of the gowns were not sterile, which prompted the court proceedings. Over four weeks of hearings in July, PPE Medpro denied the allegations, asserting that any contamination occurred during transit, and accused the Department of Health of having “buyer’s remorse” following the purchase.

Recent financial data show that as of the end of July, PPE Medpro had £541,000 in investments and was owed £1.2 million. However, after accounting for debts totaling £1.1 million, the company’s net assets have dwindled from £2.1 million to £666,025. The firm has not issued any public comments regarding these issues.

PPE Medpro’s accounts reference the Government’s claim of £133,577,920.20, plus interest, stating that the company disputes the claim and has filed a defense and counterclaim. Legal advice suggests that the company believes it has a strong defense against the allegations. The accounts also reveal that approximately £4.2 million of reserves have been utilized for legal defenses, with additional costs anticipated to reach around £100,000 since the balance sheet date.

PPE Medpro was incorporated in May 2020, shortly before it was awarded major contracts following lobbying efforts by Mone. Initially, she denied any involvement with the company, but in December 2023, she publicly acknowledged her role and expressed regret over her previous statements.

While the face masks purchased by the Government for nearly £81 million have not faced scrutiny, the gowns valued at £122 million were rejected in December 2020. The National Crime Agency has initiated a fraud investigation into these contracts, interviewing Mone and Barrowman under caution. Their residences in London and the Isle of Man were searched by detectives in April 2022, as they face allegations of conspiracy to defraud and bribery, which they deny.

Currently, Mone is on a leave of absence from the House of Lords as she seeks to address the allegations against her. A separate investigation is also underway by the Lords Commissioner for Standards to determine whether she breached conduct rules by failing to disclose her interest in PPE Medpro and lobbying for government contracts.

Emails leaked to the media indicated that Mone had claimed she was not entitled to any financial benefit from the PPE deals. Contradictorily, profits from PPE Medpro amounting to £65 million were transferred to trusts and accounts associated with Barrowman, including £29 million directed to a trust for Mone and her children. A spokesperson for the couple stated that the emails were taken out of context, asserting that they deny any wrongdoing.

Mone, known for founding the Ultimo underwear brand, was appointed to the House of Lords in 2015 and married Barrowman in 2020. Legal actions have resulted in the freezing or restraint of around £75 million of assets linked to the couple. A recent court order includes various assets, such as a townhouse in Belgravia sold for £19 million, an estate on the Isle of Man, and multiple properties in Glasgow owned through offshore companies.

While Barrowman purchased a £7 million villa in the Algarve in 2022, it has since been sold. He also owns a £41 million villa in St Barts, which has been on the market for several years, alongside a £7 million yacht and a private jet valued at £7.5 million. The ongoing legal situation continues to unfold as stakeholders await the court’s decision in this high-profile case.