‘Obvious’ conflict of interest

A court case that ultimately granted Uber back its London operating licence may have been compromised, following revelations over a conflict of interest that prompted the presiding magistrate to step aside this week.

Chief magistrate Emma Arbuthnot said she belatedly realised the link between her husband Lord Arbuthnot’s financial interests and Uber, which was highlighted by the Guardian last week and prompted her to withdraw from any future cases involving the ride-sharing app.

But Unite believes that in light of the revelations, Transport for London (TfL) should go one step further and legally support reviewing a decision made in June by the court to grant Uber a temporary 18-month licence.

In September of last year, TfL refused to renew Uber’s operating licence because it said the company’s “approach and conduct demonstrate[d] a lack of corporate responsibility”, after allegations that Uber was looking the other way when its drivers allegedly sexually assaulted passengers, among other transgressions.

Uber appealed the decision in court, and in June Arbuthnot ruled that while TfL had made the correct decision to not grant the licence at the time, the company, she believed, had substantially reformed its practices since then to warrant granting a temporary 18-month licence.

Unite London Cab section chair Jim Kelly said that the union was calling for an “immediate review of the decision.”

“It is an obvious conflict of interest when your husband is a consultant for a firm whose client is one the major investors in Uber,” he said. “We are calling on both London Transport Commissioner Mike Brown and TfL’s chief legal officer to support reviewing the decision to grant Uber a London operating licence.”

Emma Arbuthnot’s husband Lord Arbuthnot is a former Tory MP and chair of the defence select committee chair, who in 2015 was a nominated for a peerage by then prime minister David Cameron.

Only three weeks into the start of the Uber’s London appeal, Lord Arbuthnot resigned as director of a firm known as SC Strategy Ltd., a private intelligence company whose dealings are largely secret – it has no website and avoids publicity. The firm is co-owned by Sir John Scarlett, a former director of MI6 and Lord Carlile, who was formerly appointed as independent reviewer of terrorism legislation.

One of SC Strategy’s known clients is Qatar Investment Authority, a massive sovereign wealth fund which joined hedge funds in ploughing $1.2bn into Uber in a financing round in 2014.

Although Lord Arbuthnot resigned as SC Strategy director on December 31 last year, he still lists himself as being a paid ‘senior consultant’ for the firm in his register of interests.

Kelly told UNITElive that more than simply chief magistrate Arbuthnot’s conflict of interest in presiding of the Uber case are the bigger questions raised by companies such as SC Strategy.

“These firms operate in the shadows and do not appear to be publicly accountable,” he said. “Their involvement with UK defence interests also raises eyebrows. That such secretive companies are linked to Uber, another company notorious for concealing its practices and dealings should give us all pause. Do we really want such companies to be operating in the UK?”

Indeed, Uber has long been criticised for its lack of transparency – its internal financial models are a closely guarded secret, prompting concerns from investment banks. Uber has also been embroiled in a scandal over its use of Greyball, secret software used to evade authorities. What’s more, neither Uber London Ltd, nor any of Uber’s UK operations pay corporation tax in the UK despite London being its biggest European market.

“We must demand transparency and accountability from all those who set up business in the UK,” Kelly said.

As Unite calls for a review of Uber’s London operating licence, the union’s London cab section is joining a potential legal action against the ride-sharing app for damages and loss of earnings. The cab section has written to all of its London members encouraging them to sign up and express an interest.

Find out more about the legal action and how you can sign up as a London cab driver here.