CEO allegedly received £1m in unauthorised bonuses

A chief executive received more than £1m in unauthorised salary bonuses and pension payments, it has been claimed in the High Court.

Andrew Hetherington, the former chief executive of Dublin-based Repak Ltd which assists businesses in meeting recycling obligations, allegedly arranged the payments over a five-year period through “falsification of a paper trail”, the court heard.

Mr Hetherington was on secondment from British Polythene Industries (BPI) through which payments were made from Repak to him.

Under a 2001 contract, he was to receive a salary of st£100,000, a 40%-50% bonus if he met certain objectives along with a pension contribution of 25% of salary.

It is claimed he instead arranged, through falsification of documents, for bonuses of nearly 100% and 75% pension contributions in 2007-12.

Repak is seeking the return of the monies. It is suing him for fraud and deceit, and BPI for breach of duty, negligence, and misrepresentation.

BPI has denied the claims; Mr Hetherington, of Newark St, Greenock, Scotland, has yet to enter a defence.

He was removed as chief executive following a report in 2012 by consultants Grant Thornton on behalf of Repak. He returned to Scotland where he is still employed by BPI although he is currently out ill, the court heard.

Mr Justice Paul Gilligan has been asked to decide a pre-trial issue as to whether Mr Hetherington is entitled to a copy of the Grant Thornton report in advance of him putting in his defence.

The judge yesterday reserved his decision.

Mark Connaughton, for Mr Hetherington, argued that this is an exceptional circumstance whereby his client is entitled to see the full report in advance of putting in his defence. Repak had claimed “litigation privilege” over the full report, he said.

This is a situation where the most serious allegations are being made on foot of a report Mr Hetherington has never seen, counsel said.

As a result of only a draft of that report being presented to the Repak board, his job was terminated, he said. This was a breach of fair procedures and natural justice, Mr Connaughton said.

Cian Ferriter, for Repak, said Mr Hetherington had been afforded full procedures and been provided with part of the report, including 16 pages of findings against him. He has no basis to contend there was any breach of procedures, counsel said.

Mr Hetherington was “fishing” for Repak’s evidence in advance of putting in his defence which was not permissible, counsel said.