After making inquiries into progress on Resolution 12 to the Celtic AGM of 2013 there is little doubt in my mind that the SFA made a serious error in the process of UEFA licensing.
Here are some facts:
- UEFA does not issue licences to clubs who have due tax bills outstanding,
- UEFA require the SFA to satisfy themselves of a club’s eligibility for a licence and that clubs have provided proof no overdue tax payable exists,
- UEFA also require a club to tell the SFA and UEFA if, after the issue of a licence there are material changes in their circumstances which would affect their eligibility – including the situation at #1 above,
- UEFA awarded Rangers a licence to play in European competition in March 2011,
- In May 2011 Rangers received a tax bill, which they did not contest or appeal or agree a payment plan. The bill (which remains unpaid) was overdue by 30 June 2011,
- UEFA received no notice of this,
- Rangers did not lose their licence and in fact competed in both the Champions’ League and The Europa League in that season.
None of these facts are disputed (as far as is known) by anyone connected to the saga. What is in doubt, because the SFA won’t answer the question, is whether they received a copy of the tax bill and the May letter that accompanied it from Rangers or not.
If they did send it to the SFA, Rangers could reasonably argue that they did their bit and the SFA fell down on the job by failing to notify UEFA of their new unfavourable tax status.
If Rangers did not send it, then they had broken not only UEFA FFP rules but more importantly the trust amongst SFA members that full disclosure is honestly made in a self-certification process. The SFA in not carrying out their monitoring responsibilities properly and using the powers UEFA FFP gave them also broke that trust.
In either case, there is a systematic failure by the SFA to administer the sport effectively; either through a failure of trust, a failure of administration – or both.
Even worse, in the four years that have elapsed since this incident, it seems that nothing has been done to put matters right. The SFA have been very active in refusing to answer questions on the matter, particularly this one;
“How will you prevent it happening again?”
Incredibly, up to now, no measures have been put in place to add rigour to the licensing process. Are they really saying that they think the process was carried out satisfactorily?
No they are saying nothing. Silence and denial, followed by silence and inaction.
So what is the point of this article? Let’s call out the elephant in the room right away – it is unequivocally not to have a go at Rangers. This is no longer really about Rangers at all, but about the SFA’s mal-governance of the game. Besides, clubs affected by this seeming failure on the part of the authorities (in that year Celtic, Dundee United and Hearts and Kilmarnock) are hardly likely to successfully sue a club now in liquidation (although small shareholders might take a different view with regard to the SFA’s conduct).
Nor am I seeking to find some retrospective punishment for the club (as far as I know sanctions are neither available retrospectively, nor useful in this case ) but to be aware that the question above urgently needs to be addressed if the status of football as a sport is to be maintained.
To the extent that this is about what has happened to Rangers, does anyone – no matter what club they owe their allegiance to – seriously consider that TRFC would NOT be in a better situation today had the SFA acted with propriety and applied their rules correctly in 2011/12?
With the kind of money on offer these days for entry into Europe, and the interdependent nature of the game, it seems fairly self-evident that trust is not enough to allow effective regulation, and that incompetent governance where money is the paramount consideration is unacceptable.
The SFA has long enjoyed a misconceived impression of its function as being that of a quasi-legal body, bestowing upon it a status of independence and aloofness from the partisan interest of the clubs. In the main, fans have largely bought into that myth. However the SFA is nothing of the kind.
It is in fact merely a cartel which is allowed to govern itself for its own benefit and is only accountable to the clubs that make up its membership, and not the fans. Check out the last sentences of almost any rule, where discretionary powers awarded to itself effectively render the rule worthless and unenforceable.
Literally, a nihilistic approach to governance
Maybe it is time the SFA scrapped the get out of jail discretionary clauses, and put some robust regulation in place to ensure the financial transparency of all clubs?
Even better, politicians are never slow to tell us of the importance of football to the social fabric of the country – in that case why not follow their own rhetoric, recognise that it cannot be allowed to self regulate in narrow self interest, and legislate to have football governed independently?
If I was a Rangers fan, I’d be thinking that the SFA’s failure to police the UEFA licencing issue helped accelerate the club’s demise – by making it easier to paper over the cracks.
If I was a Celtic, Hearts, Dundee United or Killie fan, well the consequences for them in terms of lost financial and competitive opportunities are fairly obvious.
Conclusion? The clubs can no longer be trusted to run the affairs of the industry themselves.
A new independent, accountable regulatory body (funded by the clubs) is the minimum we need to save the game in this country. It should comprise representatives of the clubs, the fans and other stakeholders – and it should have a holistic remit as its prime directive, whilst ensuring fair and equitable treatment of all clubs.
It can take decisions on the basis of what is good for the game without the baggage of self-interest, and without any west of Scotland institutionalised bias. Of course Scotland isn’t alone in this. Football is a powerful political force across the world, and as developments at FIFA over the past couple of years have demonstrated, it is institutionally corrupt. The clubs can no longer be allowed to run it as they see fit, and we need to begin a campaign which will ultimately convince the pay-at-the-gate fan of the truth of that.
The UEFA licensing issue is only a pebble in the sand of football incompetence and corruption, but it is a microcosm of what ails the game. The good of the sport, and not individual clubs, is paramount. The SFA cannot and will not deliver that.
The case for a new regulatory body is clear, and the status quo is not an option unless the death of the sport is deemed acceptable.
There is little doubt in my mind that unless regime change is effected, in a few decades there will be no regime .
Administration would give some serious migraine action to many of the ever-expanding cast of the Rangers Story.
It may well be that Ashley and others would be happy with a cva which would get them at least something while the criminal trial elephant is still in the room. A prepack would be problematic for the same reasons that David Low, Barca and others have outlined – namely who is gonna pay for something that they may not hold title to in a year or so?
From Kingco’s point of view, administration would see them surrendering the essence of the club – the IP rights – the single thing that is vital to the club continuing in any form whatsoever.
I think King’s reluctance to invest further is down to the doubt over the integrity and validity of the sale of assets in 2012. I think he knows that he won’t be there in the longer term, but is determined to mitigate his £20 loss incurred in the DM era.
The question, which I am not qualified to answer is this; does administration give him a greater or lesser chance of achieving that?
One thing I am fairly certain of is this. There is a potential for King here. Either he is truly a RRM, or he thinks there is a way to get some of that money back. If he thought he was already fecked, he would be happy to pull the plug since it would get him off the hook on his lack of investment. My inference therefore is that he is not fecked – yet.
TRFC on the other hand look to me to be in an even more hopeless position than RFC were when Whyte with-held tax and NI payments.
ianagain 10th October 2015 at 12:38 am #
‘..John this is going to be a long one.You in training yet?’
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You know, there must be some criminal lawyers ( aye, we know they’re all criminal!) who read this blog.
It would be really good if some of them would explain to us, from a basis of knowledge and experience,what the proceedings on Friday next might entail and how much time they will take.
I can just guess that the accused will each, individually, be charged with whatever, and asked how he pleads.
Assuming they all plead ‘Not Guilty'[ and what fun if any of them were to plead ‘Guilty’], then the prosecution will outline the evidence it proposes to lead, and the witnesses that will be called.
And the various defence counsel ( because, no doubt, each of the accused will have his own lawyer and QC, one team of which will have an eye on the proceedings across the road, but with a wee up-front payment from one of the accused already in the pocket) will agree a suitable date for trial.
That might take a few minutes, or it might take several hours, for all I know.
But all these lawyer chaps and judges are well practised , and can work their diaries in concert to suit their official and personal lives , so I would guess that next Friday’s proceedings won’t last much beyond 12 noon, if that.
I’m ready for that.
But of course, the trial, whenever it is to be held, will be ,it seems, mind-numbingly lengthy.
I remember hearing that in fairly recent times a ‘financial fraud’ case in a Scottish Sheriff Court might have been the longest criminal trial in Scottish legal history.
I doubt that Mrs C would allow me to attend Court on a daily basis for more than a couple of weeks! I’d be up for it, of course, but ‘force majeure’ in the shape of wifely opposition?
My resolve would dissolve as easily and as quickly as the resolve of our Football Administrators who, when called upon to uphold Sporting Integrity when challenged by a new, upstart, brash club founded by a chancer of the first water, were prepared to sell us out, of their own accord, without wifely pressure. [ Q. to what extent were the wives of our football CEOs the power brokers? Lovely wee pseudo-academic thesis in their somewhere!]
John Clark….with all the big name witnesses supposedly being called to say what they knew you would think it would be gripping stuff. I cannot help but think however it will be a contest in who can forget the most or who wasnt aware or who was not kept informed
https://johnjamessite.wordpress.com/2015/10/09/the-perfect-storm/comment-page-1/#comment-432
King’s underfunded hostile takeover was bound to fail. It could have limped on with soft loans had these been available. Should Green prevail, RIFC will be liquidated, which I believe was always King’s strategy. If DAC Beachcroft ring-fence the first year’s anticipated fees, then it’s all over for RIFC.
However Rangers will continue under a different holding company and the 25 point deduction will not stop guaranteed promotion. Someone with more money and no criminal record will replace King. We can rest assured that we have not seen the last of Paul Murray. He is particularly adept at hitching his wagon to anyone who can elevate him to the board. Brian Kennedy will be watching proceedings with interest.
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What an extraordinary set of assumptions.
Rangers International Football Club PLC will go into liquidation.
Someone will buy Rangers Football Club Ltd, with all of it’s assets, from the liquidator.
They will then provide the club with money until season tickets for next season are sold. With no hope of seeing that money again, and will continue to fund a loss making business.
They will presumably buy the intellectual property from Mike Ashley to maintain the illusion of continuity.
This will all happen whilst Rangers continue to compete in the second tier of Scottish football and go on to win that division with a 25 point deduction.
This is just “feel good” don’t panic nonsense.
Does the crown actually release the contents of the “Witness list”?……That doesn’t seem like a very sensible approach to me !
But if they do, how do we get to see it? Other than the RRM’s lauded in the SMSM, who else may be on it of genuine interest, as opposed to the RRM v The Spivs approach of our information highways…..Anybody know?
4424me 10th October 2015 at 10:25 am #John Clark….with all the big name witnesses supposedly being called to say what they knew you would think it would be gripping stuff. I cannot help but think however it will be a contest in who can forget the most or who wasnt aware or who was not kept informed
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You mean Gordon (‘Sgt. Schultz’) Smith is giving evidence?
Scottish Football needs a relay chain of SFM court reporters.
Big Pink 10th October 2015 at 12:48 am #
TRFC on the other hand look to me to be in an even more hopeless position than RFC were when Whyte with-held tax and NI payments.
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The same thought often crosses my mind, although I have no doubts at all that whatever happens to this current Rangers, the establishment will ensure the myth of the same Rangers continues. Whatever help and protection is required from the Scottish Government, the media, the football authorities and the legal system will be given. The rest of us will be told it’s for our own good, it’s just that we can’t see it.
Corrupt Official…..all of the accused will be given a list of crown witnesses who are likely to be called to give evidence against them. Quite how that list ends up in the hands of the press is anyones guess!!
4424me 10th October 2015 at 11:58 am #Corrupt Official…..all of the accused will be given a list of crown witnesses who are likely to be called to give evidence against them. Quite how that list ends up in the hands of the press is anyones guess!!
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Cheers 4424me.
I was aware of that, for the legals to arrange interviews etc, but I imagined it would be under strict confidentiality terms. From reading reports, I couldn’t garner if there was a publicly available list, or if the info came via “The witnesses” themselves……Better to be viewed as a witness than the accused I suppose.
My main reason for asking, was to see if there were any new faces on it, or even old ones, such as Rafat, Earley, or possibly even the guy who sold the shelf company. Maybe even old mother Imran herself.
Question to the legally capable board. If I’m understanding JJ correctly he is suggesting an administration with the main creditor RIFC accepting pennies in the pound and the RFC* bit being bought out of administration with a 25 point playing penalty due to the 2nd event, regardless of owner? Yes? I’m not clear on how the RFC3 retains it’s membership thingy and avoids a restart?
sorry it feels like there should be a PHD thesis in that one paragraph.
Sorry I meant to add I thought a slate cleaning transfer of membership was only possible if solvent. Shirley 5m to Ashley, 4.5 m to 3Bs and what, 16odd million to RIFC stuffs that one. The latter I could see happily writing it off but Ashley, Taylor? Just to let someone like the BKs and hog the glory? Can’t see it.
Smugas 10th October 2015 at 1:39 pm
I am not “legally capable”, however I took him to mean that RIFC PLC would be liquidated rather than TRFC Ltd.
He did say “However Rangers will continue under a different holding company…”
There is a lot of drivel to go through though, so that is only my reading of it.
The concept is not actually that different to the wavetower scenario.
Wavetower owned 85% of the original Rangers.
RIFC PLC own 100% of the new Rangers.
If the business was not totally fecked there would be no reason for RIFC simply selling it’s shares in Rangers and it having a new owner. It would be the same club with the same licence and the same history, just a different owner.
That’s what they tried to claim with the original one. Unfortunately it wasn’t the holding company (wavetower) which folded, it was the club itself.
Yes, but if Green forces protection for RIFC surely the first thing the liquidators do is look at the assets. Asset 1 properties – ah problematic. Asset 2. 16m owing from subsidiary company. Ah now we’re talking! !Who’s that then? Oh a company attempting a solvent transfer- I don’t think so!
Homunculus 10th October 2015 at 10:48 am
https://johnjamessite.wordpress.com/2015/10/09/the-perfect-storm/comment-page-1/#comment-432
What an extraordinary set of assumptions.
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Matches my thoughts exactly, and, to me, answers the question, ‘is JJ a genuine bear?’
I think he clearly is! Which is fair enough, and as it should be.
Like many, I have often wondered if he was a bear or an Ashley/Irvine plant, but his belief that all will work out regardless and his club safely emerge from the storm he, himself, predicts, convinces me that he is genuine and only wants what is best for his club.
He clearly hates King for the charlatan he is, but shares the mindset of most bears and believes it’ll work out OK because… they are ‘Rangers’! As previously, that mindset works well for a club at Ibrox.
4424me 10th October 2015 at 10:25 am # John Clark….with all the big name witnesses supposedly being called to say what they knew you would think it would be gripping stuff. I cannot help but think however it will be a contest in who can forget the most or who wasnt aware or who was not kept informed
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Can’t help but think that that won’t be so easy in a criminal trial. I’m sure the thought that one might be charged with perjury if found to be lying in the witness box might help clear the fog of time and encourage the memory of events, and the whereabouts of ‘evidence’! Even a certain knight of the realm might prefer the wrath of the bears to the possibility of being caught out being economical with the truth under cross-examination by a determined defence lawyer.
Smugas 10th October 2015 at 2:16 pm #
Yes, but if Green forces protection for RIFC surely the first thing the liquidators do is look at the assets.
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Sorry but I’m not following you with that.
Hypothetically, would it be possible for RIFC to waive the debt from TRFC, or perhaps sell the debt to A.N. Other Co. Thus effectively gaining control of the “club”
With the percentages held by T3B’s and DCK in RIFC, they would in real terms only be paying a fraction of the £16m? “asking price”, as they can recoup their percentage from the capital carve up of RIFC before dissolving it (or handing it to plod) …They can then set about the easier task of getting the fan group’s percentage off of them, (if they choose)or give one a blazer, on condition he sits quietly in the corner.
Yes (and to clarify my point earlier) I understand green’s lawyers will be pursuing RIFC for fees for his defence. If he is successful his lawyers (according to JJ as I understand it) will pursue RIFC for said funds potentially ending in a winding up order. But, on the basis that the principle asset, the shares in TRFC and the properties therein are decided to be too problematic surely you look to the more liquid and realisable loan due back from TRFC. You can’t imagine the legal team involved would be too happy to see the cash bit, this damned ethereal but also transfereable clubby thing being sold out of that bundle leaving a cashless shell?
mind you, given the clubs monthly cash requirement they might look on it (the onward sale) as a positive!
As far as I am aware TRFC doesn’t have much in the way of liquid assets, and what it does have is secured by Mike Ashley, either through securities he has, or contracts which preclude Ibrox Stadium being sold.
So if RIFC PLC is being liquidated and it’s main asset is the debt from RFC Ltd (it’s own subsidiary) it is difficult to see how it would raise that money.
Even if it did I’m sure the other creditors (for example Ashley) would be looking for their bit prior to the parent company being paid.
Sorry if I have got that fundamentally wrong but from what I can see the subsidiary is as much of a basked case as the parent and is in no position to pay it anything, even if the debt is still outstanding.
Homunculus,
correct, so on that basis I can’t see why the club in whatever guise would be allowed to waltz off into the distance (or the premiership as JJ calls it) with nothing more than a points penalty.
Hence my my original query that I thought the Transferror had to be solvent which needs RIFC, and Ashley all to take a bath to achieve, possibly Taylor too. Just can’t see it.
I refer you to my comment of some moments ago.
“This is just “feel good” don’t panic nonsense.”
Homunculus 10th October 2015 at 5:24 pm
# As far as I am aware TRFC doesn’t have much in the way of liquid assets, and what it does have is secured by Mike Ashley, either through securities he has, or contracts which preclude Ibrox Stadium being sold.
So if RIFC PLC is being liquidated and it’s main asset is the debt from RFC Ltd (it’s own subsidiary) it is difficult to see how it would raise that money.
Even if it did I’m sure the other creditors (for example Ashley) would be looking for their bit prior to the parent company being paid.
Sorry if I have got that fundamentally wrong but from what I can see the subsidiary is as much of a basked case as the parent and is in no position to pay it anything, even if the debt is still outstanding.
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Agree with you, Hom, neither company is in any better position than the other; but one thing that might go against liquidating RIFC before TRFC is that, unless there is some legal impediment I don’t know of (and there’s much I don’t know); being unsecured creditors of TRFC to the tune of some £16m, RIFC would be able to control any administration of TRFC! Might make no difference in the end, but just might give the board/RRMs some manoeuvring room to stuff the RIFC shareholders while saving the club. I’ve no idea how, or if, they could do that, or even if it’s in their interests, but once/if RIFC is in administration/liquidation, they (the board) would have much less say/control in any attempt to get a CVA in a TRFC administration.
One thing’s for sure, unless we are totally wrong and the finances aren’t as bad as common sense says they are, then sorting out the mess, and saving anything, will be a herculean task. They will have to keep creditors to a minimum, or risk losing support in a CVA, so perhaps that would bring administration closer while there is still some funds available, but at the same time, unless they’ve got it worked out perfectly (and that would be a first since King took power) they might need to hang on until some insolvency expert comes up with a workable plan.
The one positive for them is that they’ve been on the brink of a crumbling precipice so many times, but they still confound us and escape their just desserts!
I think they need to do absolutely everything to prevent TRFC being liquidated though.
They have been arguing that the position is that there is a club owned by a holding company. If the subsidiary dies first then how can they argue that the club has not died.
Also, if the subsidiary dies, then in a case like this the parent dies as well. It has one purpose, to own the subsidiary company. If that is gone it becomes a pointless vehicle.
If both die I don’t see how even these fantasists can argue continuity.
Please remember that Mike Ashley is a secured creditor. One with very deep pockets. It will be interesting to see anyone try shennanigans when he is owed millions of pounds and has security over major assets.
Allyjambo 10th October 2015 at 6:18 pm
Re a workable plan, it’s really quite simple.
RIFC PLC sells it’s 100% share in TRFC Ltd. The buyer of the business then pays off all of the debts, cuts costs to the bone, finances his new hobby for years to come.
Right, Promise I won’t post again.
I just wanted to point out how much they need Mike Ashley onside if they need continuity.
He currently hold the following trade marks, amongst quite a few others.
Rangers – (Including if it is used in organising sporting ativities)
RFC
Ibrox
Follow Follow*
*Out of interest he is covered for
Small articles of metal hardware, articles of common metal, metal keyrings, badges all included in Class 6.
Computer software, records, videos, credit cards (encoded), phone cards, compact discs, computers, apparatus and instruments for recording, transmission or reproduction of sound and images, cameras and photographic instruments, spectacles, binoculars, electrical and electronic domestic appliances.
Paper, stationery, printed matter, photographs. plastic bags, wrapping material, periodical publications, calendars, playing cards, catalogues.
Towels, flags and pennants, bed linen, curtains, banners, handkerchiefs of textile, rugs, bath linen, household linen, bunting.
Articles of clothing, headgear, footwear, t-shirts, articles of outer clothing, jackets, jerseys, ties, pullovers, scarves, trousers, socks, shirts, sweaters, pants, sports jerseys, jumpers, track suits, football tops, football shorts, articles of sports clothing, waterproof clothing.
I wonder if Grandmaster Dingwall knows that.
Homunculus.
6 letters starting with F, 4th letter K, would have done it.
But that’s exactly it Homunculus and I’m sorry to labour the point. The continuity myth is absolutely the least of their current problems. Can you imagine it, Robertsons pitch to the assembled board:
ok ok lads I’ve pulled the proverbial rabbit here. Mikes finally on board, we stiff the Other RIFC creditors (who deserve it), we keep the stadium and most importantly we keep ourselves out of the evil clutches of BarL.
But, but what about the old club myth doesn’t that mean anything to you?
Eh no.
Homunculus 10th October 2015 at 6:33 pm #
I think they need to do absolutely everything to prevent TRFC being liquidated though.
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I don’t see why – if they can make themselves believe Rangers FC still lives on, they can make themselves believe anything, and nobody involved at Ibrox bothers about anyone else’s opinion outside of their own anyway.
Administration, though, and agreeing a very generous (to TRFC) CVA, will solve much of their problems (or maybe not, but…), and a CVA will be more achievable with RIFC’s £16m claim in with the other creditors. It is possible that, with his £5m loan only partially secured now, MA might well be in a position to block a CVA for TRFC and to hold them to ransom – or just walk away with whatever he can get, but if RIFC have a £16m claim, they will swing it their way. They won’t have control over that vote if RIFC is in liquidation, and probably not if in administration with proper administrators more interested in saving RIFC than TRFC.
We can be pretty sure that King and the 3bears are spending many a long hour mulling over what is the best course to take for TRFC. Perhaps, though, they are not all of the same mind, and at least one will be thinking of what’s best for himself and making his own calculations and plans. Perhaps they all are.
I feel pretty certain, though, that after each discussion they end up agreeing that they need someone to come along with millions to throw away in their direction: or to make peace with Mike Ashley and to welcome him back. I wouldn’t be in the least surprised if they have already written off their loans to the club, and are past asking themselves if they can afford to risk any more, because it’s not a risk when the loss of their money is such a certainty!
I think, maybe, that we have lost sight of the fact that TRFC were in a precarious position before the news of the arrests broke and it became a distinct possibility that they don’t own Ibrox and MP. Then there’s Green’s claim for legal fees to be covered. I get the feeling that, if Green loses out in his claim, there will be much joy amongst the bears, believing that all their problems are over. That, I think, is what saturation PR propaganda does.
At the start of the season, according to King, TRFC needed full houses and serious fresh investment to see them through the season. They have got the full houses, but not the investment. Their problems, though, have escalated to the extent that they need even more fresh investment than they did before but getting that investment has been made even harder (and it was already a very hard ask) than before.
There can be little doubt that they are in a massive financial mess. Maybe not a terminal mess, but only major investment, or the administration to beat all administrations, can stop it becoming a terminal mess.
Homunculus 10th October 2015 at 6:36 pm
Allyjambo 10th October 2015 at 6:18 pm
Re a workable plan, it’s really quite simple.
RIFC PLC sells it’s 100% share in TRFC Ltd. The buyer of the business then pays off all of the debts, cuts costs to the bone, finances his new hobby for years to come.
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Jings crivens, I hadn’t thought of that one
I bet they’re all lining up with their Lotto winning tickets to grab that bargain!
I bet that nice Mr King is just waiting for the right moment to announce he’s found the key to his piggy bank
Allyjambo 10th October 2015 at 7:33 pm
“It is possible that, with his £5m loan only partially secured now …” in what way is his loan only partly secured, I wasn’t aware of that. He certainly seems to still have a whole wheen of securities extant.
As far as I am aware if TRFC is placed into administration then Ashley gets his money first. It is only after that is paid that RIFC, or anyone else would get anything.
As I have said before, I really don’t see where they would raise funds. Basically the administrator would have to look to sell assets to raise cash, or find someone willing to put a lot of money in. Bearing in mind the administrator is trying to achieve a viable business coming out of the administration.
As there are currently doubts about the ownership of the assets that makes something that was nigh on impossible lose the “nigh on”.
I realise I’m talking in circles now, so for the sake of the blog I’ll leave it at that.
Homunculus 10th October 2015 at 7:49 pm
Allyjambo 10th October 2015 at 7:33 pm
“It is possible that, with his £5m loan only partially secured now …” in what way is his loan only partly secured, I wasn’t aware of that. He certainly seems to still have a whole wheen of securities extant.
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Not saying you’re wrong, but it has been discussed here, and elsewhere, that the doubt over the ownership of MP (and the other assets sold to Sevco by D&P) kind of puts a doubt over Ashley’s security over that property. Whether the remaining security over the car park and Edmiston House is worth £5m is debateable, I think. I don’t know how much the car park and EH are worth, but I’m sure they were purchased from D Murray at much less than £5m.
I would suspect that, in the event of an administration, Ashley would receive, either those properties or the sale proceeds, and then lodge a claim for the balance.
Of course, we don’t know how the doubt over the ownership of property over which a standard security has been taken will be dealt with, perhaps Ashley will be told he just has to wait for the criminal cases to be decided, then a decision on who owns the property (how many years might that take?), before he can get his money – or not. But depending on how Ashley might like to see things run, he might, if it’s possible, forego his security over MP, and then have the power to influence the CVA vote (assuming administration, of course).
Like so much of what has befallen TRFC recently, there is great doubt over what it might mean, and the doubt will almost certainly be there for a number of years to come. The club might flounder in administration for years to come if the administrators can’t realise assets. That doubt will cause as much, if not more, damage to TRFC’s viability as the eventual outcome of the cases might have. I think, too, that a 25 point penalty is received for each season a club remains in administration!
Like you, though, I believe that the only real chance for TRFC to continue in the guise of Rangers is if MA takes a hand. Any other new club, wishing to take over that guise, will have to deal with MA to be able to give a visible appearance of that old club. That might not be easy, and any contract will almost certainly be onerous.
Homunculus/Smugas/Allyjambo
To summarise
TRFC owe RIFC over £16m (I thought it was nearer £20m from the IPO)
Mike Ashley/SD.com is/are owed £5m by TRFC and until/unless a court decides otherwise this is secured against MP,EH,AC and the IP
If RIFC first suffers an insolvency event the first thing a reputable insolvency practitioner would do is attempt to recover the £16m+ owed by TRFC even if that created another insolvency event (which it almost certainly would) at TRFC.
If TRFC first suffers an insolvency event then RIFC would follow as it’s only apparent asset is its 100% holding of TRFC.
In either case the Secured creditor of TRFC, Mike Ashley, would take precedence over the biggest creditor of TRFC and once the secured creditor is satisfied the other trade creditors can scavenge the rest of the carcass(es).
I think it was summed up earlier, without a substantial injection of soft loans or “investment” the current entity playing out of Ibrox is a six letter word starting with F and 4th letter K
Big Pink 10th October 2015 at 12:30 am #
Not all journalists are in the NUJ, and not all NUJ members automatically get accreditation. The qualifying conditions are on the NUJ website – and given the nature of most of your work, BP, I think you might have a reasonable case.
I would imagine the branch meetings would be pretty frosty though; freelances are a famously miserable lot.
As for accreditation to the Court; I really do think that it would be worth getting in touch with the appropriate office – they can only say no and I would imagine the few places available are already taken by the usual suspects. Given the high profile of the case though, I think it would be in the public interest for a full transcript to be available for publication somewhere. If I remember correctly, during a recent high-profile perjury trial the Office of Communications was putting out large amounts of material themselves on a daily basis.
‘tykebhoy 10th October 2015 at 8:44 pm #
‘…..If RIFC first suffers an insolvency event the first thing a reputable insolvency practitioner would do is attempt to recover the £16m+ owed by TRFC even if that created another insolvency event (which it almost certainly would) at TRFC…’
___________
From what I’ve been reading* as I try to get my head round the relationship between a ‘holding company’ and ‘a wholly owned subsidiary’, the law appears to be decidedly unclear when it comes to a ‘subsidiary’ being solvent when the parent is insolvent.
A basic principle seems to be that the directors of a subsidiary must act in the interests of that subsidiary , because, apparently, a ‘group’ has no legal persona. The duty of ‘loyalty’ to the parent company might not be absolute.
There seem to have been very few cases recorded in which a subsidiary is solvent when the parent becomes insolvent.But in those cases, it is by no means entirely certain that the parent company can use the subsidiary’s resources to bail it out.
If that is indeed the case, then TRFC directors, in the best interests of their shareholders (all of them) might conceivably have to resist any early re-payment of any debts they owe to the insolvent RIFC.
Talk about Alice’s experience in Wonderland!
It looks to me as though the cheating of SDM and the knavery of others and the utterly unprincipled actions of the Football Authorities might result in legal firsts in all kinds of directions.And keep liquidators and lawyers in business for yonks.
*I was reading a paper (of no great authority, by a Czek law student) comparing the the ‘common law based’ systems in the USA and England with the Czek approach to company law in the matter of ‘groups’ and ‘parent companies’, and reciprocal ‘loyalties’ .
http://www.commonlawreview.cz/the-relationship-between-a-parent-company-and-its-subsidiary-does-the-family-stick-together
You might agree that I clearly didn’t understand a word of it!
I vaguely recall some time back, it was noted that the Ashley loan was made to TRFC. This was considered unusual, or unorthodox, at the time in so much as previous loans via the Easedales and Laxey, were made to RIFC before the funds were cleared for the use of the club.
Forgive me, but my recollection is rather foggy, and i can’t remember if a reason for this was ever explained in any way.
http://rangers.g3dhosting.com/regulatory_news_article/373
http://rangers.g3dhosting.com/regulatory_news_article/453
As it is the “club” and not the “company” that owes this debt, what advantage (if any)did this give Ashley, to structure the loan thus, as compared to the previous loans?. …Does it now have any significance, if a forthcoming insolvency event may be on the horizon for either, or both companies? Company rules and regs are hard enough for me to get my head around, and this jiggling about between club and company only adds to my confusion.
It may be nothing, but Mick doesn’t seem to be the type of guy who chooses a particular route because he is lazy or it is easier. I would say he had his reasons.
TallBoy Poppy 10th October 2015 at 9:37 pm
)
‘..Not all journalists are in the NUJ, and not all NUJ members automatically get accreditation. The qualifying conditions are on the NUJ website – and given the nature of most of your work, BP, I think you might have a reasonable case..’
_______
Before I comment, can I say that I can hardly read what I’m writing because the print is so small. Can any kind person tell me how to get it back to normal size, please? I must have hit a wrong key ( as I do in so many areas of life!
__________
But tae my comment, Tallboy Poppy.
If even an auld yin like me can now ( however reluctantly) see that the ‘social media’ made possible by the Internet enable the passage of news and information to ( theoretically) millions of people worldwide, instantly and simultaneously, and that the print Press is nearly as obsolete as the guys with hats with a wee card reading ‘PRESS’ tucked into the hatband [I love those old movies!],
then surely the Judicial system ( every judge presently in post is, I think, younger than I! ) should be ready to accept that respectable blogs with a regular readership of ‘x’ amount have replaced,or at least are as valid as, the traditional print Press.
Subject, of course, to their being recognised as identifiable, censure-able, jail-able organs, and the requirement that they report the facts that emerge in the course of a trial ,in an absolutely pukka, unbiased, non-selective way, and without comment.
The way the ‘Press’ are supposed to do.
Corrupt official 10th October 2015 at 10:50 pm #
‘.. I vaguely recall some time back, ..’
_______
And what a debt we owe to those who have kept their own archives since RTC days, and can produce facts, figures, links, quotations, summaries to keep us right when our individual memories and recollections are a bit confused, or when we begin to imagine that what we would like to be the case is in fact the case!
These are the guys ( or, who knows?, the girls) who rain-in our wilder speculations by reminding us of the actual facts, to prevent our horses galloping off , uncontrolled.
We can be pretty well assured that no speculation based on factual error will be allowed to pass unchallenged.
And that, for me, puts this blog up in the level of stratospheric ‘Integrity’.
My post of 11.33 pm.
Sorry about the ‘rain’. It should have been ‘rein’.
I hate when I do that, because I tend to be critical of the BBC Radio Scotland folk, when they get things wrong. And I don’t mean the Sportsound chaps, but the bloody newscasters!
There was a girl reading the news earlier today who utterly threw me when she talked about a bombing in AnKAHra. Turns out she meant ANkara, capital of Turkey,
And I thought: how the hell are these people recruited? What kind of graduate entrant to the BBC is so feckin ignorant of the conventional usage of foreign place names?
And on that general theme, if the pass mark in my ‘Highers’ exams had been …what? 37 %?, I’d be getting the Nobel prize in just about everything!
John Clark 10th October 2015 at 11:33 pm
John, Being a guy who is happiest when wearing a boilersuit, my computer skills are not what they should be. I have learned some basics from the weans, but it hasn’t extended to archiving (yet) But I will probably be a whizz by the time this saga is unravelled.
I agree the guys (unisex) in here who have compiled the info are a god-send, and Aye ! It’s good to come here and be corrected or enlightened on a false belief or opinion that has crept in. (Sometimes disappointing too, but Cest la vie).
I’m also behind the idea of trying to get some form of accreditation and “press” type access. Not only for court, (and your previous reportage has been better than anything I have read elsewhere) but club pressers too. Door chapping credentials….How good is that….. I can hear the barrels of the double mortise turning already.
Corrupt official 11th October 2015 at 12:41 am #
‘…Aye ! It’s good to come here and be corrected or enlightened on a false belief or opinion that has crept in. (Sometimes disappointing too, but Cest la vie).’
________
Not so much a false belief, perhaps, as a view of things which we might not have the hard and fast evidence to actually prove in a court of law..
For example, there may be a view that the close relationship between , say,
the president of an organisation which is responsible for the governance of the members of that organisation,
and one of the members of that organisation of which he had been a fairly recent employee
an employee who had obtained a ‘loan’ from a trust that his former employer had set up,
is highly suspect.
I may think it was, you may think it was, the entire world of Mongolian or Scottish or Italian( or whatever) Football may think it was.
But we do not have the evidence (yet) to nail the b.star.!
What we have is a closing of ranks: Scottish football ranks, and Scottish press ranks, and, perhaps, Scottish legal ranks.
We have to remember that the prosecution of the Greens Whytes etc next week is being signalled up as a defence of RFC-as-was against guys who ripped it off, SDM excepted,of course!
The prosecution is going ahead only because RFC can be shown to be a ‘victim’. I believe that there would be no prosecution of anybody if such prosecution would have included SDM among the accused.
But maybe that’s just me.
John Clark 11th October 2015 at 1:21 am
I tend to agree, and we have seen the early priming in the SMSM alluding to that already.
However I would limit that to the Craigy takeover. Green et al only became involved after administration, (MCR aside) so they cannot be accused of bumping Rangers(I.A), as they were effectively already gone by that stage.
Being able to make Rangers(I.L) appear the victims, will hinge on the take-over sale, not the fire sale. The PF will have seen the evidence provided to him and made his decision on charges, but what he may not have seen yet, is the evidence that we all hope Craigy has in a safe place. Hopefully in a can marked “Worms”, inside a steel box marked, “Do not carry”
I boak at the size of Sevco’s alleged PR bills, but I wonder what Minty’s is to keep him out of the circus, but over-riding all of that will be how to portray themselves as victims when the final tax bill is tallied up.
Keep up the good fight.
https://www.youtube.com/watch?v=6s-_Xxj_rrA
John C.
To make the writing bigger you can ‘zoom’ your screen.
If you are using Chrome as a browser, click on the three horizontal bars in the top right corner and you will see ‘Zoom’ as one of the choices.
For Internet Explorer, click on the gearwheel in the same corner. Again, ‘zoom’ will be one of the choices presented.
In Firefox, it’s the three bars although it doesn’t actually say ‘zoom’. It just shows the percentages
So the Scottish Sun has named charlotte fakes today ? Wonder where this guy fits into the scheme of things but i wouldnt fancy being his postman
4424me
Any chance of a copy paste of CF item as the bit I read suggests guy is in trouble.
A MAN accused of leaking secret documents about Rangers is today named by The Scottish Sun on Sunday as William Stevenson.
Stevenson, 46, faces an extortion charge over claims private details about the club and ex-owner Craig Whyte were revealed on Twitter account Charlotte Fakes.
Whyte and former Ibrox spin doctor Jack Irvine’s emails were allegedly targeted and posted.
It’s claimed taped chats between Whyte and ex-Gers chief exec Green were also revealed. Cops were alerted in 2013 after the Ibrox side was rocked by revelations on social media.
Stevenson, who was arrested last October, is also accused of breaching the Computer Misuse Act and Communications Act.
The Crown Office said: “A report concerning a 46-year-old man remains under consideration.” It’s thought Stevenson may be a witness in the fraud trial against Whyte, Green and five other men following Green’s takeover of Rangers.
We told how they ran a gauntlet of hate when they appeared in court last month.
Stevenson was unavailable for comment.
Looks like he may form an important part of the prosecution’s case, and perhaps be responsible for bringing the men the bears hate to court. I hope they all see it that way and, while not treating him as a hero, allow him to live his life in peace.
If he is to give evidence based on what he posted as CF, it will pretty much verify those posts and allow us to treat them as evidence of the shennanigans we were convinced happened, like SFA conivance in, and their knowledge of, RFC’s impending insolvency.
The men in the Hampden bunker might have as much to fear from his evidence as they do from Green and Whyte’s!
CO
” Door chapping credentials….How good is that….. I can hear the barrels of the double mortise turning already.”
******
Double mortise locks have levers, cylinder locks, Yale, etc., have tumblers.
# retiredjiner
If he is to be a witness at the forthcoming trial, then he may have done a plea bargain with the Crown, otherwise I would have expected him to have been up in court before now.
Words and in particular their connotations fascinate me. For example juxtaposing a biscuit tin and a warchest, or arriving in Scotland and jetting in.
Since when was two people discussing fraud, gratuitous alienation, shafting creditors etc become a “chat”.
easyJambo 11th October 2015 at 10:52 am #
‘..he may have done a plea bargain with the Crown, otherwise I would have expected him to have been up in court before now..’
_______
If it weren’t for the alleged charge of ‘extortion’ [ if true, I wonder who the would-be victim was and what degree of panic rose in his breastie!], I’d be happy to regard your man as deserving honourable ‘whistle-blower’ status, in performing a public service.
But you must be right: he’s hardly likely to sing like a canary if he thinks he may still be prosecuted.
Here’s hoping he sings loud and sweetly and is instrumental in furthering the cause of justice!
In the Scousers least favourite rag, it states “A MAN accused of leaking secret documents about Rangers” but it makes no mention of him facing any charges for such an offence, but does say he “faces an extortion charge” ……..A charge that is sitting on the books and “Under consideration”, one year later……..Hmmmmm!
Call me a sceptic, but that extortion charge appears to be on flimsy ground. ….I wonder who made the extortion claims, but I wouldn’t dare guess.
#retiredjiner. I hear you that with bonny night coming up your services were in high demand.
Folks
Thanks for posting the Sun Article.
It is inaccurate and the motives for naming CF must be questioned.
Many of us have seen what was leaked. It’s veracity is no longer questioned.
The only thing that stopped msm delving was the “provenance” defense. ie how was it obtained?
That has enabled msm to excuse itself from investigation what is already clear to SFM readers on Res12 and LNS.
It would make sense for the justice system pursuing the truth to use whatever means it can to establish that truth so I believe the theory of CF as a potential witness is the most likely.
The charges against him were of extortion against CW and company. How likely is that to stand?
Nope we are entering a new phase and only the reluctance to prejudge upcoming in cases will keep the football authority safe for now.
However when the duplicity against football supporters and shareholders is finally revealed and understood, the SFA will join UEFA and FIFA on the governance scrap heap.
They are simply not fit for purpose.
If CF’s revelation are to be used as evidence in the upcoming criminal cases they must have been forensically examined, possibly to the nth degree, by the prosecution. I think we can safely accept that they are genuine and that what we deduced from them was pretty accurate, too. I know they won’t be able to touch the story until the court case is over, but it will be interesting to see the MSM go to town with the evidence, of, say, what was discussed at Whyte’s dinner with Regan and Ogilvie…or perhaps not!
Hopefully someone still has copies of what was posted online so we can ensure those intrepid journalists won’t miss out on their big scoops because there are no copies available to them
No doubt how CF obtained the ‘evidence’ will come out in the trial, and may form a story in itself, and hopefully, there will be a lot that we haven’t yet seen or heard!
However it all pans out, there must be a few people trying to remember what they have ever said to those in the dock, and if it had been recorded or included in an email. I hope it gives them all many a sleepless night!
AllyJambo
Rest assured the full narrative based on and supported by CF leaks has been circulated by mail to those Celtic shareholders who requested same re Res12.
If you e mail auldheid046@gmail.com you can have a copy.
Might take me a day or more to respond if others also request.
Latest from JohnJames:
https://johnjamessite.wordpress.com/2015/10/11/rfc-redux/
In order for evidence to be led in court someone has to speak to it. There are a very few exceptions to that so for ease of use it’s as well just thinking that evidence needs a witness. Someone to speak to the production and someone to interpret it. Often but not always the same person.
However no-one can be forced to implicate himself in an offence. Basically an accused person cannot be made to give evidence in a case where they are accused of a crime. They can choose to if they want to but they cannot be compelled to.
So if this chap is going to be a witness then it is highly unlikely that he will be an accused, certainly in the same trial.
There is a kind of way of thinking in these things. Often the best witnesses are also capable of being accused of the crime they are a witness to, particularly in things like fraud cases. Crown Office have to make a decision, who do you want to prosecute and who would you rather use as a witness. What best serves justice.
Corrupt official 10th October 2015 at 10:50 pm
I wondered about that at the time, my own thoughts are(and I may be wrong) that the assets are actually owned by TRFC and not RIFC and therefore perhaps ashley foresaw some possible jiggery pokery around the 2 companies and thus nipped that in the bud by giving the loans to TRFC and not RIFC. I may be well off beam with that and happy to be corrected.
As Phil keeps pointing out, they need money/investment/loans to see out the season but they keep constantly hitting icebergs, first the court cases and the huge question mark over the assets and now green’s legal fees. They couldn’t balance the books before these 2 issues, they have no chance now.
No one with the sort of cash required to keep them going will want to lend them money on an unsecured basis, given that there can be no share issue with the question mark over the assets(which may take years to conclude), only ibrox remains currently unencumbered(and would provoke howls from the fans if used as security), and they currently lose between 500k and 1m per month.
I cannot see how they can avoid admin, however, i’ve been thinking that for some time now and every time it’s come close, they have managed to dodge it.
torrejohnbhoy(@johnbhoy1958) 11th October 2015 at 12:08 pm
“Rangers have not been short of new and upstanding suitors, notably Millar, Sarver and Ashley. Millar quickly realized that a faction of our support were so reprehensible that he was not willing to sustain any more vile personal attacks on his family or his girlfriend.”
Alternately, to quote Mr Miller, who was the preferred bidder and as such would have had a good deal of access to business records.
“By late Monday night, it became clear to me that preliminary information, discussions and analysis were, unfortunately, more optimistic than reality.”
And to quote one his former advisers.
“Upon full inspection, Rangers was not a ‘turnaround’ opportunity. It was (and is) an opportunity for someone with great wealth and a love of football and/or Scotland to give away tens and tens of millions of pounds. Unless some major, systemic changes occur within the current configuration of UK and European football leagues, I don’t think the Rangers math works.”
I’m sure he wasn’t happy about the “Yanks go home”, however if I remember correctly it was actually the mess the business was in and the vast sums of money he would need to inject, with no prospect of return which was the main deal breaker.
More nonsense from Mr James I’m afraid.
Auldheid 11th October 2015 at 12:06 pm #
AllyJamboRest assured the full narrative based on and supported by CF leaks has been circulated by mail to those Celtic shareholders who requested same re Res12.If you e mail auldheid046@gmail.com you can have a copy.Might take me a day or more to respond if others also request.
Thanks for that, will email once home, hate having to log into my email on this tablety thing, it’s so finiky
Dutchmul 11th October 2015 at 12:23 pm #Corrupt official 10th October 2015 at 10:50 pm
I wondered about that at the time,
——————————————————————————————————-
Afternoon Dutchmul.
I’m pretty sure Mick had his reasons, and it looks like his intention was to cover both camps, individually and in duality. Cut off an escape hatch so to speak. I just can’t figure out what manoeuvre it was designed to counter.
Who would enter the business world in the Soo’side, where covering your anus, guarding against shaftings while attempting to shaft, is an average day in the office. Where hawks sit over the petty cash tin (they call it a safe) and ear-prints are a permanent smudge on your door. A place where having control of the “minority” appears more important than financial probity.
Dignity indeed !…… Is it any wonder the bloo room burn out rate is so high? I’m amazed they get ANY work done.
BIG PINK YOU HAVE A PM .
Answer that bloody phone of yours for once !
Corrupt official 11th October 2015 at 1:39 pm #
Dutchmul 11th October 2015 at 12:23 pm #Corrupt official 10th October 2015 at 10:50 pmI wondered about that at the time, ——————————————————————————————————- Afternoon Dutchmul. I’m pretty sure Mick had his reasons, and it looks like his intention was to cover both camps, individually and in duality. Cut off an escape hatch so to speak. I just can’t figure out what manoeuvre it was designed to counter. Who would enter the business world in the Soo’side, where covering your anus, guarding against shaftings while attempting to shaft, is an average day in the office. Where hawks sit over the petty cash tin (they call it a safe) and ear-prints are a permanent smudge on your door. A place where having control of the “minority” appears more important than financial probity. Dignity indeed !…… Is it any wonder the bloo room burn out rate is so high? I’m amazed they get ANY work done.
—————–
I can only think that Ashley was aware of the potential for an insolvency event and wanted to be owed his money by TRFC rather than by the holding company that no one, on either board, would hesitate to cut adrift, along with the shareholders and creditors, if they thought it would save ‘the club’ or leave them with more money/loot. Although the deal was made with his board, he was aware of the threat from King and the possibility of a board hostile to his interests.
Not sure that, in the end, it would make any difference, but perhaps it was just a belt and braces exercise.
^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^
Could it simply be that because TRFC own the assets, Ashley wanted his loan and his security to be with the same entity? I’m not even sure that if I loan money to A, I can take a security for that loan over property owned by B? Perhaps someone knows the answer to that.
Homunculas 12.14
I can confirm no charges against CF. All dropped. Which is a pity in one way that it gave him the veritas opportunity as an accused witness. If used he will be on opposite side which should be welcome news for TRFC fans as it is their club that was subject to activity that may prove to have been criminal.
The Extortion charge was against Duff and Phelps not CW btw.
Since June 2013 the CF stuff has been there for anyone to investigate. It caused Res12 to be adjourned and not voted against but by its provenance nature made it a difficult issue to pursue openly.
It is also the source of HMRC letters to RFC in Feb and May 2011 that tells us the UEFA licence should have been questioned if not revoked, that RFC lied in submission to UEFA, that SFA were negligent or compliant and that Harper MacLeod were kept in the dark in 2012 when commissioning LNS.
Again whilst TRFC are involved none of the skullduggery would have been possible under real governance, so again TRFC fans should welcome this development. The truth might hurt a bit but the poison it’s denial enables is killing the game.
It’s a sad sad day when the media try to intimidate someone for doing the job they should have done.
Hey Auldheid ,
Are you an Optician ?
The font size of your posts gets smaller and smaller . Of course, there will be a lot of “small print” checking going on just now .
Allyjambo 11th October 2015 at 2:22 pm #Corrupt official 11th October 2015 at 1:39 pm #
Dutchmul 11th October 2015 at 12:23 pm #Corrupt official 10th October 2015 at 10:50 pmI wondered about that at the time,
I can only think that Ashley was aware of the potential for an insolvency event and wanted to be owed his money by TRFC rather than by the holding company that no one, on either board, would hesitate to cut adrift, along with the shareholders and creditors, if they thought it would save ‘the club’ or leave them with more money/loot. Although the deal was made with his board, he was aware of the threat from King and the possibility of a board hostile to his interests.
Not sure that, in the end, it would make any difference, but perhaps it was just a belt and braces exercise
——————————————————————————————————
Ally
I would go along with that type scenario, but it is gifting Mick with an amazing sense of foresight. At the time he was clearly top dog and running the show. Not only seeing forky tongue coming, but laying mines and barbed wire along his route, shows an astute strategic mind. (If he could apply himself to using it to construct a better working deal for his staff, I would probably quite like the guy).
It looked at the time he was a few paces ahead of the pack, but this puts him in the final, while the rest were still scrambling around in the qualifying heats looking for their sannies and inking numbers on their simmits.
neepheid 11th October 2015 at 2:44 pm
I tend to agree it was done this way in order to protect his own position. He wanted the borrowing secured against assets held by the borrower.
In any case, it was TRFC who actually needed the money anyway. It is TRFC which actually trades, RIFC is simply a holding company which does nothing other than own 100% of TRFC.
This is from the USA however the concept is interesting. It’s from 2012.
“Lenders and other creditors should be aware of an opinion recently issued by the United States Court of Appeals for the Eleventh Circuit. In Senior Transeastern Lenders v. Official Comm. of Unsecured Creditors,[1] (Tousa) the court addressed a situation in which a parent company incurred millions of dollars in debt secured by the assets of its subsidiaries to finance the settlement of a claim owed by the parent. The parent and subsidiaries subsequently filed bankruptcy, and the unsecured creditors’ committee challenged the financing and the liens given by the subsidiaries as fraudulent transfers. The Court of Appeals affirmed a bankruptcy court decision which unwound the financing and avoided the liens because, as found by the bankruptcy court, the subsidiaries were “insolvent” at the time of the loan and did not receive “reasonably equivalent value” in exchange for the liens placed on their assets.”
Something else maybe worth reading, from a firm of chartered charlatans, sorry accountants.
“An essential characteristic of a limited company is that it protects the assets of the shareholders (owners) and directors (managers) of the business in the event that the company fails and goes into liquidation. This is generally known as the veil of incorporation. It is then the creditors of the company who bear the brunt of its losses.
In many small companies, of course, the expenditure giving rise to such losses will have been funded by bank lending, secured by guarantees given by directors/shareholders.
However, in the good times, as companies grow, they will often develop their own asset base and will try to fund day-to-day running costs (including current wages, administration costs, stocks and work in progress) out of trade creditors and other current creditors (which may include HM Revenue & Customs in relation to PAYE tax and National Insurance, VAT and Corporation Tax). At this stage, prudent directors may want to see if there is a way to preserve major assets against risk and the possibility of bad times to come.
One way of protecting key assets is for a company to form a wholly owned subsidiary, and to transfer the trade into it, along with its current assets and most or all of its future liabilities. Major assets of the original company can be retained in it. If this is contractually problematic, it is usually possible to achieve the same results by forming a new holding company above the main trading company. The original shareholders become shareholders in the holding company instead, and the trading company becomes a wholly owned subsidiary of the holding company. With care, major assets of the trading company can then be transferred up to the holding company at little or no cost, leaving the risky end of the business in the subsidiary. With the new “group” structure in place (by either mechanism), if the trading subsidiary goes into liquidation at a later stage, its creditors have no automatic right to the assets of the holding company.
Assets to be protected in this way might include buildings, intellectual property (goodwill, patents rights, and so on), and major items of plant and machinery.
So let’s not be fooled by the suggestion that an established holding company is there to provide secure backing for its subsidiary. It may have been formed for exactly the opposite purpose – so that the subsidiary can sink without trace at the expense of its creditors, whilst protecting the real asset base of the holding company (and the ultimate shareholders).
On the other hand, should you be thinking about creating a holding company to protect the major assets of your own business?”
Thon JJ seems to be morphing his writing into that kind of mid 1950s Glasgow
Corporation pomposity so much used by the unlamented Leggo…
bfbpuzzled 11th October 2015 at 3:24 pm
I think it’s a bit harsh comparing him to Leggat, a man who resigned from the NUJ the day before a complaint against him was upheld. The claim relating to his writings about other people being motivated, at least in part, by anti-Irish racism. He was not considered to be a fit and proper person by other journalists. That must take some doing.
I do think that Mr James does come away with quite a lot of bunkum, however in my limited experience it is bunkum which is misleading other Rangers supporter. I don’t think it’s the normally the type of unsavoury stuff which Leggat was often fond of.
Like I said I have limited experience of his musings. Pretty much the more recent stuff since he started blogging on his own.
Hi all,
I have not contributed for a while just watching the shenanigans going on. I am unsure that the people in the background will be willing to let Sevco disappear? I do believe that the Establishment will not let this club die. We all know that any other football club would be a distant memory by now. I have said in the past that the Scottish Government and the Judges will find it too hard for justice to be allowed to take its course.From the administration onwards we have seen new ways and rules, and even new companies appear from nowhere! (Sevco 5088 – Sevco Scotland).If a way can be found to keep this boat afloat it will be found. It is sad, but where else would in the World, would allow such chancers and dodgy characters be allowed to sit in Boardrooms and ignore normal laws?If a club emerged from this mess, and apologised to all, and started from scratch, I am sure that fans on all sides would cheer them on. Unfortunately, this is Scotland, and we will once again have to witness the Law failing to do what is right!
JimmyBeeJay
Homunculus 11th October 2015 at 3:11 pm #neepheid 11th October 2015 at 2:44 pm
I tend to agree it was done this way in order to protect his own position. He wanted the borrowing secured against assets held by the borrower.
================================================
Thanks very much for that, and for putting some fine succulent meat (of the honest variety) on the bones.
Why would the Prosecution need CF as a witness ?
I presume they will have access to the original material and the ability to question those such as Whyte and Green on it’s veracity
They can’t ask Whyte and Green about it, unless they themselves choose to become witnesses.
An accused person cannot be forced to incriminate himself.
Homunculus,
Still don’t see what CF could bring to a prosecution. The prosecutors surely can introduce any documents as evidence. They will have their own experts and possibly the web hosting companies to confirm authenticity.
Why would they need CF ?
I presume also that once / if the contents of Whyte’s emails are used in court by the prosecution , there will be no provenance issues for Res 12.