The terms of a £3.4 million loan to the former chief executive of a collapsed Hove company have prompted fresh concerns.
Palmer and Harvey (P&H) went into administration with the seven-figure sum owed to the wholesaler by former boss Chris Etherington.
According to the Sunday Times, P&H directors agreed to change the terms of the loan so that it would have to be repaid only if Mr Etherington, 65, sold his shares in the business.
This looks impossible now that P&H is in administration.
The collapse of the business cost almost 3,000 people their job – more than 400 of them worked at the old head office in Davigdor Road, Hove.
The Sunday Times said that a small group of executives and managers had been paid dividends totalling almost £77 million since a management buyout in 2008 that loaded P&H with debt.
The company, which supplied thousands of corner shops, garage and convenience stores with snacks and cigarettes, went under with debts estimated at £65 million, the newspaper said.
The pension fund is believed to have a huge shortfall, according to other recent newspaper reports.
And many of Palmer and Harvey’s staff were thought to have been banking on significant future lump sums, having bought shares in the company which are now likely to be worthless.
The Labour MP Frank Field, chairman of the House of Commons Work and Pensions Select Committee, has asked questions about the pension deficit at P&H.
Mr Field is also reported to be calling for the administrators, from accountancy firm PwC, to force Mr Etherington to repay his £3.4 million loan.
The Sunday Times quoted PwC as saying: “In line with their statutory responsibilities, the administrators will investigate the circumstances leading to the failure of the business in due course.”