It was quite a distressing experience reading Gary Ralston’s piece in the Record today. It broke the news that ‘same club’ Sevco are going to have to pay the £250,000 fine levied on a different club following the deliberations of the Lord Nimmo Smith Commission.
It was distressing because the anguish that could be discerned in almost every syllable of the article put my sides in severe danger of splitting.
Anyone with any interest in the fair and effective governance of Scottish football will be aware that the LNS commission was a deeply-flawed exercise which should be consigned to the dustbin marked ‘this was an strangely-limited enquiry headed by someone who wasn’t sitting in any actual legal capacity’.
It was defective because it simply did not take anything like a proper look at all the factors at play in Rangers’ EBT and side-letter shenanigans. For example,
- The Discounted Options Scheme (which Rangers had conceded to HMRC as taxable) was inexplicably excluded from the scope of the commission.
- There was an assumption that EBTs were lawful and not taxable on the basis of a First Tier Tax Tribunal ruling; and
- The SFA provided utterly bewildering testimony that the secret side-letters accompanying contracts simply made player registrations ‘imperfect’ rather than ‘completely blindly obviously invalid’.
If nothing else, revisiting the second and third bullet points would certainly bring into play a point made by LNS himself in his final report:
“There may be extreme cases in which there is such a fundamental defect that the registration of a player must be treated as having been invalid from the outset”.
Many of us think that the Commission was a joke, and the media’s apparent determination to avoid looking into it (despite receiving lots of paperwork) is remarkable.
Any sensible governing bodies and clubs wanting Scottish football to take place on a level playing field ought to ensure that LNS is set aside and something more systematic and genuinely enquiring is put in its place. It remains to be seen whether that will happen. And if it does occur, it will be fascinating to observe whether it does so through
- pressure from clubs and fans following the final ruling in the Big Tax Case; or as a result of
- fans crowd-funding a judicial review.
Who knows? But the Commission was an embarrassment to Scottish football and to the very concept of ‘justice’, and there are many of us who will not rest until its flaws are remedied.
But back to the main point of this particular blog. LNS levied his fine on the ‘Oldco’ Rangers. Which was a polite way of saying ‘Rangers (IL)’. And that would have been the end of the matter had a condition of Sevco’s fast-tracked entry into senior football in 2012 not been that they paid Rangers’ footballing debts.
Clearly the SPFL Board felt that these included the LNS fine, and fair play to them for pursuing one of the very few actual ‘punishments’ handed out to dead Rangers following their astonishing misdeeds. [NB the hard-of-thinking should remember that there is a big difference between punishments and consequences…]
I am sure that many of us will have enjoyed the minor poetic justice of the staunchly adamant ‘same club’ being punished for something that a different club did!
Of course, the glorious King regime at Sevco was clear that the fine was nothing to do with the ‘same club’. As the recently-published audited accounts of the Sevco engine room subsidiary said:
Ultimately the matter ended up being considered by an SFA arbitration process on 29 and 30 October 2015. And then there was silence.
And then even more silence.
Until today, when Gary Ralston declared that a trio of High Court judges (who have presumably increased Sevco’s bill for LNS costs beyond the previous-suggested £150,000) had decided that Scotland’s newest club was liable for the fine.
And what an upsetting tale he told! Here are some extracts:
“A senior SPFL source has revealed the Ibrox club have been told to pay the penalty originally handed down to oldco Rangers after an inquiry by Lord Nimmo Smith in February 2013.”
“Rangers newco, under Charles Green, were asked to accept liability for the £250,000 fine as part of the controversial five way agreement that led to the award of a licence to play in the Third Division in the summer of 2012.
Rangers fans will be angered at being landed with another legacy bill and, in particular, the doggedness of the SPFL in demanding it be paid, even though it was originally handed to oldco.
However, the SPFL insist newco Rangers gave the undertaking they would cover oldco’s costs and former chairman David Somers and chief executive Graham Wallace even engaged in talks to suggest ways of paying it.
All bets were off, however, when the disgraced former board were replaced by the new regime last year, led by Dave King, and he carried out a thorough review of all the club’s outstanding legal cases.
The SPFL insider revealed there is still an appeal route open to Rangers via the Court of Arbitration for Sport, but it would be a lengthy and expensive process and Hampden bosses are confident a line will be drawn under the matter.
Gers chairman King could now sanction a cheque for the payment or, more likely, the SPFL will take the £250,000 from the £474,750 prize money Rangers are due to receive if, as expected, they win the Championship in the coming weeks.
Rangers last night declined to comment, but it’s understood they are furious over alleged breaches of confidentiality on the news they have lost.”
Isn’t that absolutely magnificent?!
If only Mr Ralston had gone on to explain why the secret Five Way Agreement was ‘controversial’, or – better still – obtained and published a copy.
The idea of Sevco fans being angered at their ‘same club’ being landed with a bill when ‘it’ ran up millions of pounds worth of still-unpaid debts to 276 creditors is absolutely breathtaking!
And how dare the SPFL be so “dogged” in demanding money that they believed they were owed?! What manner of invoice-issuing sorcery were they practicing?!
It will be interesting to see whether Sevco try to overturn the fine at the Court of Arbitration for Sport. Aside from the likely expense, there is also the possibility of the Court speaking some uncomfortable home truths about the nature of Sevco as a new club. Would they really want to take that risk?
But my favourite parts of the piece were the final two paragraphs. The description of Dave King ‘sanctioning’ the writing of a cheque is absolutely wonderful. It gives the impression that parting with any cash is a rather painful undertaking.
And as for the suggestion that Sevco are “furious” at someone putting information out to the media – an action that you might call ‘spin’ or ‘public relations’ – I am not sure that I will ever get over it!