Ex Northern Rock boss turns property entrepreneur

This is the chap who presided over one of the most spectacular banking meltdowns in recent history. He was generously rewarded for it too: his departure from Northern Rock was accompanied by a £760,000 golden goodbye.

In addition to this, back in January 2006 Applegarth sold off £1.5m worth of Northern Rock shares in just two days. Northern Rock's stock was worth 957p at this point, with stakeholders blissfully unaware that the bank was about to crumble. Now the man is setting out to add to this - his already sizeable - pile of lucre.

This irks me for a number of reasons. Applegarth walked away from the Northern Rock debacle with his nose clean. He is using the same strategy with this fledgling business. Both he and his son are listed as consultants, which protects their assets should the company fail.

Entrepreneurs in this country often bemoan the UK's attitude to failure. In the US, there is much less stigma attached to those whose businesses fold. It takes real guts to pick up and start again, having failed before. But this does not apply to Applegarth. Here is a man who assumed no risk for the money he lost or the decisions he made. A man who was guaranteed a fat bonus, regardless of performance. That he should turn 'entrepreneur' now, using a similar risk-free model, is galling.

Mark Needham, chairman of consumer electronics firm Widget UK, has a more balanced view of the banker-turned-entrepreneur. "Even if he started the banking crisis singlehandedly, I would have thought it was better for him to start a business and try and earn his living rather than spending his life on the golf course," he says.

"If it means that he will be spending part of his ill-gotten bonus employing people or using local services in the North East then it is better than him living in tax exile and spending it drinking himself to death."

Will Wynne, founder of ArenaFlowers.com, is equally charitable. "We all make mistakes and entrepreneurs are to be encouraged," he says.

Ling Valentine, founder of Lings Cars, goes even further in defence of Applegarth: "If he did not do anything with his money, no one would benefit. If he creates a successful business, think how many people might benefit. Lots. I would say people who want to stop him running a successful business are particularly stupid. Why stop Applegarth contributing to society? If he succeeds in building a profitable venture, wouldn't that be great?

"Most people who criticise Applegarth are people who have never tried and failed, or tried and succeeded in business," continues Valentine. "I think most people who know hard it is to start a business and make it successful will endorse his efforts."

The entrepreneurs have spoken. But I'll stick to my guns.  This man isn't out to contribute to the UK economy, or employ hundreds of people. He's out to make a quick buck. And, as Needham sagely observes: "Not sure I would lend him money!"

Are you with the pro Applegarth faction? Would you have the ex-banker barred from business? Have your say below.

 

Picture source: Dominic Alves

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