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Co-operative Bank chief Paul Flowers' sordid past revealed: he quit as councillor after porn was found on his computer and was convicted of public sex act

By Lauren Turner

Former chairman of the Co-operative Bank Paul Flowers resigned as a councillor in Bradford two years ago after "inappropriate" content was found on his computer, the council has said.

Mr Flowers, a Methodist minister who chaired the Co-operative Bank for three years from 2010, was exposed allegedly buying and using illegal drugs, including crystal meth, in a newspaper sting at the weekend.

It has also emerged that he was convicted of gross indecency in 1981, reportedly over a sex act in a public toilet.

A Methodist Church spokesman said that at the time he went through the "usual procedures" before being allowed to continue in his role.

"He was very contrite, and he continued his work," the spokesman said.

He left Bradford council in September 2011, after almost a decade, citing personal reasons and increased responsibilities at the Co-operative Banking Group.

A spokesman for Bradford Council said yesterday: "Inappropriate but not illegal adult content was found on a council computer handed in by Councillor Flowers for servicing.

"This was put to him and he resigned immediately."

The latest revelations about Mr Flowers will heap further embarrassment on the Co-op, whose long-standing chairman Len Wardle announced yesterday he was resigning with immediate effect after he admitted "serious questions" were raised by the sting.

Mr Wardle, who has held the position since 2007, announced last month he was due to leave next May but he said it was now right for him to go straight away, having led the board that appointed Mr Flowers.

Mr Flowers served as a member of Bradford Council's executive from May 2010 to August 2011, when he stepped down from the post, saying he had "increasing and competing demands" on his time.

The next month he resigned as a Labour councillor for the Great Horton ward, having served on the council since 2001.

At the time, he said in a statement, reported by the Bradford Telegraph and Argus: "It has become clear to me that, over the longer term, I will be unable to sustain the workload associated with performing both roles to the best of my ability."

The supermarkets-to-funerals Co-operative Group has launched a fact-finding investigation into "any inappropriate behaviour" and a "root-and-branch" review of its structure in the wake of the revelations about Mr Flowers.

Critics have questioned how he could have been appointed given his apparent lack of experience. Andrew Tyrie, chairman of the Treasury Select Committee, said that, even before the weekend's revelations, it was clear he was "manifestly unsuitable".

Mr Flowers now faces a police investigation.

He has apologised over the scandal and been suspended by the Methodist Church as well as the Labour Party.

The Co-operative Bank is facing a rescue plan which will see majority control turned over to investors including US hedge funds, after it was left with a £1.5bn gap in its finances after the takeover of the Britannia Building Society in 2009.

The group, which employs 100,000 people, plunged to £559m losses in the first half of the year, weighed down by its banking arm.

In July, it appointed former Treasury mandarin Sir Christopher Kelly to head an independent investigation into what went wrong at the bank.

Sir Christopher will report back at the mutual's annual meeting next May.

The fate of the bank has been described as a "tragedy" by former group chief executive Peter Marks.

Mr Tyrie, who heads the Parliamentary Commission on Banking Standards, said regulatory supervision of it had been a "complete disaster".

He has said that the latest episode, involving Mr Flowers, shows the need to implement regulatory reform for bankers as recommended by the commission.

It called for the approved persons regime (APR) to be scrapped and replaced. Mr Tyrie said APR had "degenerated into little more than a bureaucratic box-ticking exercise".

He argues that, instead, there needs to be continuing and "intrusive" supervision of bank bosses.

Regulators have said that Mr Flowers went through the appropriate process when he joined the Co-op's board as non-executive director, but he did not face further scrutiny when he became the bank's chairman.

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