Olympic agency investigated over £100million 'black hole'

My Account
Logout

Create an Evening Standard Account

Use your social network

Save time by using your existing account to sign in to Evening Standard

We'll never share your information or post anything to your account without your permission

Welcome! Sign in here

Use your social network

Save time by using your existing account to sign in to Evening Standard

We'll never share your information or post anything to your account without your permission

Forgot your password ?

Registration

* indicates fields that are mandatory

Email *

Password *

Confirm Password *

First name *

Surname *

Postcode *

Country *

Mobile phone number

Username *

Gender *

Year of birth *

When you sign up...

You will have access to all our online competitions, discounted offers and can post comments on our site.

You will also receive The Weekender newsletter sent every Thursday - it’s full of fantastic offers and ideas for the weekend. You can update your email preferences in your account page when you log in.

Other newsletters and emails

Homes & Property Newsletter - Yes I want to receive the weekly email with all the latest news on property in the capital

Occasionally we would also like to send you relevant emails detailing specific offers either from ourselves or carefully selected partners. If you would prefer not to receive these then please tick the appropriate boxes below. We will never pass on your details.

I do not want to receive additional offers and information from the Evening Standard

I do not want to receive additional offers and information sent by Evening Standard on behalf of carefully selected partners

Terms and Conditions

* I have read, understood and agree to be bound by the terms and conditions of Evening Standard

Registration

Mail Sent for Registration Confirmation.

A confirmation email has been sent. Please activate your account by clicking on the activation link sent in your mail box.

Independent auditors have been drafted in to examine the huge irregularities, unearthed during a routine audit. Two senior members of staff at the LDA, which is the Mayor of London's economic and business unit, have been suspended.

Gareth Blacker, who oversaw the purchase of the Olympic site in the Lea Valley near Stratford is on indefinite leave, as is his accountant. There is no suggestion of wrongdoing by either of them.

The Times said forensic accountants from KPMG, the consultancy advising on cost-cutting measures on other parts of the London 2012 set-up, have been called in to trace the money.

They are focusing on Mr Blacker's department, the Olympic Legacy Directorate, the last of the LDA departments to be reviewed following Boris Johnson's announcement of a comprehensive audit in March.

It is claimed analysis of its accounts revealed that between £60million and £100million allocated as compensation for businesses forced to relocate from the site is unaccounted for.

The agency has £750million to renovate the Olympic site. It agreed a price of about £1million an acre for 193 small and medium-sized businesses to move to alternative premises but, four years on, has yet to settle 72 claims.

The accounting anomaly relates to an apparent failure to put aside the money. KPMG will determine whether this was a genuine oversight, incompetence or a cover-up.

Auditors will also determine whether or not the money is retrievable.

A source told The Times: "This has gone beyond a routine audit, into the realms of a fraud investigation."

The anomaly leaves the agency with a cashflow problem that could cause other projects to be delayed or shelved.

Questions have also been raised as to why Andrew Travers, the LDA's risk and resources director, is overseeing the investigation into accounts he must have signed off.

The discovery is the latest in a string of embarrassments for Mr Johnson.

A spokesman for the LDA admitted that a review had identified some "additional spending commitments" but claimed the shortfall could be made up from savings elsewhere.