The Wee Tax Bill: a scam explored

Monday evening’s Newsnight report on Rangers financial troubles came just three days before BBC Scotland’s much anticipated documentary “Scotland Investigates: Rangers – The Inside Story”.  It is now clear that this blog has achieved its central mission: to open up discussion on the most important story in the history of Scottish football.  I found it difficult to sit back and listen to the conspiracy of silence within the mainstream Scottish media.  Their failure to do their jobs allowed the many falsehoods promulgated by the club’s executives to fill the void and be accepted as truth.

It is hard to believe how far, and how fast, this story has moved since May 2010.  Stories of Rangers’ tax troubles were initially derided by many as just malicious Internet rumours.  A skillful disinformation campaign left Rangers fans with the clear impression that it was Sir David Murray’s Murray International Holdings Ltd (Rangers’ parent company until just over four months ago) who would be responsible for paying any tax liabilities.  The amounts of the bills were ridiculed by journalists briefed by senior Rangers employees.  We were told that the club had expert advice saying that the risks of the tax case were negligible.  In any case, Rangers’ tax advisers’ professional liability insurance would be picking up the tab!  This was all typical of mainstream opinion just a matter of three months ago.  It is with some degree of pride that I look at how far the truth has come.

This blog is not solely responsible for bringing light to the darkness.  A small cadre of bloggers, messageboard posters, and journalists were on this story before this blog was even a gleam in my eye.  However, it would be disingenuous to not acknowledge the role that this blog, and its many contributors, have played in establishing the truth in the Scottish public’s consciousness.

In particular, we all owe a lot of gratitude to the real heroes of this story: the sources who had the courage to approach an anonymous blogger with information that could end their careers or worse.   When I publicised the leaking of the Bain Papers, this story was forever altered.  Craig Whyte’s claim that this blog was “99% crap” became laughable to even the most sceptical reader.  I believe that this was the  point when this story moved mainstream.

Yet for all of the sense of vindication regarding our revelations related to ‘the big case’, Rangers appear to be grasping at the last straws of solvency over more prosaic issues.  The failure to qualify for the group stages of either European competition, the arrestment of cash by former executives and solicitors, and money blown on expensive PR agencies in a forlorn effort to paint a picture of confidence and competence around the club’s new owner, have all combined to drain the Ibrox coffers faster than Craig Whyte had imagined.   Survival to the end of the current season without filing for insolvency seems unlikely.  Some even say that matters will come to a head in just a few more weeks.  If this long dance comes to an abrupt halt in just a few more movements, it will have been the less heralded ‘wee tax case’ that delivered the knockout blow.  While Scotland sits back to absorb BBC Scotland’s take on the larger issues that make insolvency a virtual certainty upon losing ‘the big case’, I thought that some more background on the ‘wee tax case’ might be interesting.  It is a tale that will leave the layman surprised at the transparent sham and fraudulent nature of the transactions.  As we will see, HMRC must have had very strong evidence indeed for Rangers to admit liability for the underpaid tax and interest.

We will simplify the facts to explain the concept, but the following is a good facsimilie of the Discounted Options Scheme used to compensate some players.  To execute this scam, a club would form an offshore company in a tax haven like the Bahamas or the British Virgin Islands.  Cash would be deposited in a bank account owned by the newly formed offshore company.  Let us suppose that £10 million was deposited.   Rather than paying players this money as wages that would have seen about 50%  taken in UK PAYE and NIC taxes, players would be given options in the offshore company.   Options provide holders with the opportunity, but not the obligation, to buy shares in the company at a predetermined price by a certain date.  As the shares in this company do not trade on the stock market (indeed the offshore company does not do any meaningful trading of any type), their real value will simply be a function of the amount of cash held in its bank accounts.  So the decision to buy the shares or let them expire worthless should be a simple one.

So let us hypothesize that ten players are granted 1 option each in the offshore company.  Assessing the taxable value of each option is easy.  (Let us suppose for simplicity that 1 option buys 1 real share).  With 10 options for £10 million cash, the value of each option would be £1 million.  Each player would be able to convert his option into a real share and would then receive a dividend, tax-free, that would pay him his £1 million cash.  So far, this story is just a blatant money laundering scam and transparently illegal if tax is not paid on the full value of the cash received by the players.  However, here comes the “clever” bit: the football club issues itself with, let us say, 9,999,990 options.  This would mean that there were now 10 million options for £10 million cash in the bank.  The value of each option is now £1 each.  By a flaw  UK law at the time, the players would only pay tax on the value of the options at the time their issue.  So each player would pay 50p in tax.  You might be asking yourself:  “So what?  The club owns most of the options!”  – and that is where this scam gets clever.  The football club allows its options to expire worthless a few weeks later- after each player has paid his 50p tax.  The players all exercise their options and divide the £10 million in the bank between them.  (The money is actually held in an offshore trust to prevent any squabbling between the players later.  A trustee pays each player according to rules provided by the football club).

Such a scheme is obviously a way to avoid paying the tax that mere mortals have to pay every day.  I am told by tax specialists that this scheme is not as illegal as it might seem.  The use of a Discounted Options Scheme like this would straddle the line of legality.   For Rangers to have rolled over and signed an agreement to pay tax and interest of £2.8 million rather than delay payment by appealing the assessments  (just as it did in ‘the big case’), HMRC must have had a massive degree of leverage over the club’s (former) executives.  While I have received confirmation from two independent sources that Rangers did indeed use a scheme like this, I do not have specific information that would indicate an inept or criminal implementation of this scheme, but I do know what they were doing with the EBT scheme during the same period.  It does not seem unreasonable to think that something must have been seriously wrong with how Rangers implemented this scheme.  Why else would the old board have folded when an appeal was the obvious next move?

Even more interesting is the curious case of the bill for the £1.4 million penalty.  Whyte was reported to have been ‘foaming at the mouth’ when this bill was received.  Rangers would have had 30 days to appeal this bill and defer it until it is decided by its own First Tier Tribunal.  Rangers have made no statement claiming to have filed an appeal for this penalty.  My enquiries have failed to produce any evidence of an appeal having been filed at all.  (A late appeal would almost certainly be allowed).  Why might Rangers not appeal?  The tribunals service in Scotland is settling down into a more established process and private tribunal hearings are increasingly difficult to obtain without a national security angle.  It would be quite likely that a new First Tier Tribunal for the penalty in ‘the wee case’ would be held in public.   In a case that the old board agreed in writing to pay when it could have filed an appeal, and where evidence of Whyte filing an appeal for the penalty is conspicuous by its absence, I am very curious as to what Rangers might have done that it would want to keep so quiet?

Perhaps the members of the Rangers Supporters Trust who are reported to be meeting with Whyte tomorrow (Wednesday) might want to ask if the penalty has been appealed?  Now that the case has become worthy of investigation by the likes of the BBC, perhaps the Scottish football mediapack might try to redeem itself by investigating this point for itself?

About rangerstaxcase
I have information on Rangers' tax case, and I will use this blog to provide the details of what Rangers FC have done, why it was illegal, and what the implications for what was (updated) one of the largest football clubs in Britain.

1,562 Responses to The Wee Tax Bill: a scam explored

  1. Odear says:

    Paulie Walnut; if you were running a numbers joint on this would yyou be giving odds just now on things going to plan for Whyte at present, or is the glare of publicity going to hamper his plans?

  2. campsiejoe says:
    23/10/2011 at 5:51 pm (Edit)
    TBK @ 5.49

    I’m sure RTC said that an assessment was a bill
    Stand to be corrected though
    In layman’s terms a tax assessment is a demand for payment by HMRC. However, it is not legally enforceable if it is being appealed until the amounts are confirmed or set by a First Tier Tribunal. “bill” and “assessment” are interchangeable for most practical purposes.

  3. BillyBhoy68 says:

    Another site that might be of relevance (if I can dig up further info)

    Another nice domain name. Look at the admin contact/company name. Does this fella have more than one identity ?

  4. OnandOnandOnand says:

    The Don

    I raise my glass of Fiano to you as I retire to watch Spooks

  5. the Don Dionisio says:
    23/10/2011 at 8:47 pm (Edit)
    People keep droning on about Administration, when it will be Receivership, as advised by Onand(x3) and myself on many occasions now.

    Anyway, on a lighter note:-

    the Don: “………… think that would fool a Corleone?”
    CW: “No, Godfather, I’m innocent, I swear on the kids”
    the Don: “Sit down”
    CW: “Please don’t do this to me, Godfather, please don’t”
    the Don: “Barzini is dead. So is Phillip Tattaglia. Moe Greene. Stracci. Cuneo. Today I settled all
    all family business so don’t tell me that you’re innocent. Admit what you did.

    ………………………….only don’t tell me that you’re innocent, because it insults my

    Almost all of those talking about administration do not understand the difference or the significance. Many are taking their cues from the journalists who have suddenly become experts in this subject.

    Why on earth would Whyte agree to administration which would be dominated by the interests of the unsecured creditors (given their vastly greater value) than receivership which would be designed to benefit only Whyte?

    I think there is a little bit of denial going on. People can find lots of snippets of information that support the idea that administration would mean problems for Whyte. Whereas, the receivership information shows him making a clean escape. Just like Rangers fans who do not want to admit that Whyte has some serious issues in his background, some Celtic fans want to see this process as easier than it will actually be.

    There are only 2 clouds on Rangers’ horizon that I can see:
    – SFA/SPL rules regarding transfer of a club registration
    – Whyte’s legal troubles from his past (and possibly future) catching up with him

    If RFC were in any other line of work, the insolvency process would work entirely to his advantage.

  6. Beerbelly says:

    And they say a week is a long time in politics!

    Resignations from the ever dwindling board of directors; non co-operation with the BBC; a BBC documentary; confirmation of a little 7-year ban from being a director (on a technicality!), indications of fraudulent activity and association with undesirables, and a revealing interview with a laptop loyal, sprinkled with some colourful language, and perhaps some snippets left on the cutting room floor!

    In an environment where one could be confused as to who should be the focus of attention i.e. the great Architect himself SDM, the ever so compliant and non-investigative Scottish media, or the RFC directors who have overseen the use of EBT’s over a significant period of time, well so far they have escaped lightly as the light shines on the man who came in from the shadows, and every time he speaks he provides some succour for some of the above. Whilst I can see why the BBC chose to focus on Mr Whyte, let’s not forget about the others.

    Whilst I am stating the obvious to most of this blogs contributors, surely what has been confirmed without doubt from his comments this week is that Mr Whyte has absolutely NO intention of paying HMRC “one thin dime” of the big tax bill, he treats HMRC with utter disdain.

    Whilst I do have reservations about the competency and actions of publicly funded bodies, I was impressed with their actions regarding the small tax case, and so I hope that their focus continues in the same vein.

    So where do we go from here, who is pulling the strings? I have no doubt that RTC and the intelligent bloggers will have to continue to inform, probe, and report on their findings if justice has to be served, their job is not yet done.

    Those who have stuck their heads above the parapet to inform us all have not only to be applauded, but supported as this latest episode comes to the boil over the coming weeks, months, and perhaps longer.

    To answer my own question, in my opinion Mr Whyte is presently pulling the strings, he still decides when administration / receivership occurs, but this very blog has enlightened others such that his planned timelines may well have changed, and it has exposed explicitly his motives.

    Only my opinion.

  7. Good find from BillyBhoy68:

    HTX Holdings
    SJO 12622
    1601 NW97th Ave.
    Miami, FL 33102-5331


    Administrative Contact:
    Whyte, Craig
    SJO 12622
    1601 NW97th Ave.
    Miami, FL 33102-5331
    Technical Contact:
    Ltd, Webfusion
    5 Roundwood Avenue
    Stockley Park
    Uxbridge, Middlesex UB11 1FF
    +44.8712309525 Fax: +44.8701650437

    Registration Service Provider:,
    08709126612 (fax)
    This company may be contacted for domain login/passwords,
    DNS/Nameserver changes, and general domain support questions.

    Registrar of Record: TUCOWS, INC.
    Record last updated on 15-Dec-2010.
    Record expires on 16-Dec-2011.
    Record created on 16-Dec-2008.

    Registrar Domain Name Help Center:

    Domain servers in listed order:

    Domain status: clientTransferProhibited

    Fear And Greed Report? 🙂 Anyone know anything about it?

  8. the Don Dionisio says:

    buon gusto e centanni.

    Agreed, and I appreciate your support !

  9. AllWhyteOnTheNight says:

    RTC 9.03 I go on about administration because I know exactly what I am talking about.

    If you can find an example of a football club going into receivership other than Luton where they got rid of all the players then I would be interested to hear.

    Something like half the football league have been in administration since the collapse of ITV Digital. Plenty of these clubs had pre 2003 floating charges.

    If he appoints a receiver then I guarantee HMRC will seek a winding up order immediately and there will be nothing a receiver can do to stop it. If its administration then a liquidator can not be appointed.

    If he does appoint a receiver then it really is Armageddon and start with a newco. That’s a big gamble and I think they will try for a CVA.

    At the end of the day it doesn’t matter to Wavetower which it is as they have a floating charge but to get their money back someone will have to buy Rangers assets. So since it doesn’t matter then why not appoint an Administrator which will actually give you the best chance to maximise realisations. McGregor, Jelavic et al aren’t worth much to you if the SFA hold their registrations.

  10. easyJambo says:

    Paulie Walnuts says: 23/10/2011 at 4:40 pm & rangerstaxcase says: 23/10/2011 at 5:12 pm

    Maybe I’m putting 2+2 together and getting 5, but from earlier posts by Paul McConville, my understanding was that 60 days after the HMRC arrestment (end Oct), that a “preference” would be accorded to the claim. Would that not put HMRC in a queue behind Wavetower’s floating charge but ahead of the unsecured creditors?

    Does that scenario apply between the 60 day mark and the 14 week automatic trasfer of funds?

    Does the receiver also have to apply to the court to have the funds released form the arrestment? If so, surely HMRC would oppose such a release on the basis of the takeover documents and missed payment dates, when the club was still solvent.

  11. AllWhyteOnTheNight says:

    Also whilst there is no football creditor rule, all debts to other clubs have to be settled in full to retain membership. In other words they have to pay Hearts the £800k they still owe them for Wallace.

    Now obviously this does not apply to a newco but are Hearts going to vote for a newco to join the SPL when they have been stiffed for so much.

  12. easyJambo says:

    AWOTN – Hearts can request that the SPL withhold any money due to RFC with respect to TV or Merit payments and have it paid direct to them.

  13. AllWhyteOnTheNight says:

    Easyjambo, yes they can but if Rangers fail to fulfill their fixtures then the SPL will be owing Rangers nothing. They may decide to divvy the money up amongst all the other clubs or might look favourably on Hearts.

    This is just another reason why Rangers couldn’t do any decent transfer deals. Nearly all significant transfers nowadays are done in instalments. (some clubs factor these instalments to asset based lenders so that they can get more cash now). By the time they were running around trying to buy Goodwillie the word was out that nobody would advance funds based on an instalment to be paid by Rangers one or two years down the line.

  14. TheBlackKnight says:

    You could also look at, owned by HTX Holdings at the same address and appear to be a company registration Ofex/ Aim listing type.

    GUESS WHO? holdings s.a. HTX Holdings S.A..html

    And lastly……………

    Note the address, directors and the recent posting of NOTICE OF STRIKING OFF DISCONTINUED……. worth buying a copy?

  15. Lord Wobbly says:

    rangerstaxcase says:
    23/10/2011 at 9:08 pm
    Good find from BillyBhoy68:
    HTX Holdings
    SJO 12622
    1601 NW97th Ave.
    Miami, FL 33102-5331
    Administrative Contact:
    Whyte, Craig
    SJO 12622
    1601 NW97th Ave.
    Miami, FL 33102-5331
    Dunno about the Fear and Greed Report, but it looks as if the 1601 NW97th Ave address might be a mail forwarding facility.

  16. georgios says:

    Why don’t Hearts go to court to seek an arrestment for the cash they are owed?

  17. the Don Dionisio says:

    For administration to work , there has to be a CVA, to allow them to come back out of administration, otherwise what’s the point?

    As Onand (x3), HMcE and others have pointed out, given the enormity of HMRCs debt here (which dwarves that of the English clubs you cited) there is liitle or no prospect of HMRC agreeing to a CVA, and they will use their 25% blocking vote.

    Also, CW’S interests do not necessarily converge with those of RFC.

    If push comes to shove he will look after number one–true to form?–and RFC’s interests will come a poor second. That’s why Receivership is best for Group, if not for Club, and anyway Group/ Receiver can procure a hive down whereby oldco dies with all the HMRC and other unsecured debt and newco walks away with the assets in satisfaction of the now greatly inflated secured debt due to Group.
    Will CW care what happens after that?

  18. OnandOnandOnand says:


    I don’t disagree with you on much of what you say and I’m sure you’ve probably forgotten more about administration than I will ever know but my problem is that, tactically, administration surrenders to control and gives rise to an exit route, the CVA, which he can’t win as HMRC will control at least £25m of voting power. The administrator acts for all creditors. CW would only have done this if he knew he would have maximum control. I tip my hat to HMRC as their arrestment of the small tax case money probably screwed up CW’s timetable royally and encoraged others to go to the arrestment table.

    These deals are never a one shot hit. He will have borrowed, say, £22m He will pay off Lloyds and have enough in reserve to pay off Hearts and the rest as an inducement to allowing Wavetower into the SPL. It is reported that Bain’s Counsel claims CW is no stranger to inducements.

    In my view, he will ramp up the debt to him, reduce the asset value to break up, appoint a Receiver, take the assets in exchange for debt leaving nothing in Rangers, call an emergency meeting of SPL with his Wavetower chequebook open to pay off any outstandings. He trhen owns Rangers 100% (how does he keep his promise to “look after” the small shareholders, maybe gives then equivalent non-voting “B” shares in Wavetower), re-values the assets and can borrow even more a la Glazers.

    Brave man if that is his plan, so much can go wrong with that

  19. OnandOnandOnand says:

    an afterthought

    To those who say he will do all of the above to sell on the assets, who will he sell to? The market is a tough place. Let’s say a group of Rangers minded businessmen get together and make an offer, what would they bid? If I were one of the consortium, I would urge that we pay him his cost plus, say, a million for his trouble, why would I want to pay more? I’m pretty sure we would be the only ones stepping up to the plate, we would want to drive a hard bargain. Come to think of it, cost plus £1 seems much fairer.

    Sale of the assets is unlikely to be his goal.

  20. AllWhyteOnTheNight says:

    Guys not trying to pick a fight, always enjoy your contributions. Just got a bit narked at RTC suggesting that everyone who mentions administration has been picking it up from the papers.

    All of the newco stuff can be done by an Administrator as well though.

    Whilst a receiver owes his main duty of care to the floating charge holder he also has to ensure that his actions do not prejudice any possible return to the unsecured creditors. That’s one reason why even if there is absolutely no chance of funds being available to unsecured creditors someone like HMRC could appoint a liquidator to investigate the actions of the receiver. It would also be up to a liquidator to investigate wrongful trading etc ( a receiver can not bring such an action).

    A receiver will still have to get as much as possible for the assets. Unless the debt to Wavetower has become enormous then the unsecured creditors will be expecting some money to be available to them as well. A receiver can’t just say “hey Wavetower you are owed lots of cash, how about Ibrox, the IP and Murray Park, is that a deal”. He will have to show that best value has been achieved.

  21. gunnerb says:

    OnandOnandOnand says:
    23/10/2011 at 10:12 pm

    “….He will have borrowed, say, £22m ”

    We are back to who financed the deal then. If Wavetower accept all the assets of RFC to cover what they claim to be owed under the charge then CW either keeps the hived down newco and attempts to run RFC2 himself or its is sold to his mysterious financier for a nominal fee, clearance of original borrowings and a tidy sum for his efforts to take with him back to Monaco.Anyone care to guess at who will be bidding for the newco?

  22. OnandOnandOnand says:


    Yep, all fair points. It could be administration with a hive down and no CVA, just keep the administration going until Wavetower are admitted by hook or by that other word. I’m off to read the new post.

  23. AllWhyteOnTheNight says:

    I also think the last thing Whyte wants is to own a newco football club, whatever division it is in. You still need to sell it to get your money back (and this is not his £18m, just money he borrowed from somewhere else).

    The only reason he is there is to make a turn on realising the floating charge. He can quite happily be seen to charge penalties, interest etc. Lloyds would have been hammered just for asking for what they were owed back. Lloyds could not be the floating charge holder when the insolvency happens, that’s why they had that conversation with Alistair Johnston.

  24. AllWhyteOnTheNight says:
    23/10/2011 at 10:24 pm (Edit)
    sorry if I was a bit casual in what I posted.

    What you have posted above is entirely correct. I see the issue as heading towards receivership simply because the unsecured creditors do not have a say in practice until the receiver has satisfied the floating charge holder. While you are correct that the receiver still has a duty to maximise recovery, I am not sure that Rangers entire value in insolvency will exceed £18m.

  25. TheBlackKnight says:


    TheBlackKnight says:
    Your comment is awaiting moderation.
    23/10/2011 at 10:02 pm

    Think it may be the multiple websites in relation to CW/ Tixway/ HTX holdings etc


    Look at cash in bank SINCE April 2011 and the lodging of the DISS40 date?

  26. AllWhyteOnTheNight says:

    No probs RTC, (it hurt because I respect your work so much)

    What we don’t know is how much cash Rangers might actually be sitting on at this precise moment. If they are paying nobody then there may still be £5-10m sitting about. Throw in cutting down the arrestments and getting that cash back, then you don’t have too far to go and you haven’t even sold Ibrox/Murray Park or the marble from the staircase.

  27. greengrass says:

    looks like louie has appeared on ff…

    HMS.Temple.Garden HMS.Temple.Garden is online now

    Join Date: 31-12-2006
    Location: out of the dry heat of the Arctic
    Posts: 13,487
    Default a follow on from yesterdays Scots Law thread
    here is the thread from yesterday…ght=mcconville

    and here is the email I have received from a certain Paul McConville

    Thank you for having an interest in my blog and taking the time to make a comment.

    I am well aware of the newspaper report you refer to. As your Mr Whyte is finding out, not everything that is printed in the newspapers is correct and it can often be a total distortion of the truth. Newspapers are happy to make two and two equal five.

    For the avoidance of doubt, notwithstanding the implication of the article, not a penny was unaccounted for in my business.

    I try to write about matters with a legal connection. If that relates to new laws, English court cases, Scottish court cases, law reform proposals, nonsense in newspapers or football, I am happy to write on it, as you will see from my blog.

    Perhaps the Hearts situation will next justify a blog piece, or there might be legal developments at Parkhead to comment on.

    For now however, the Rangers story is the interesting one in Scotland as far as football is concerned.

    I claim no monopoly on knowledge, and am quite happy to be corrected if I make a mistake.

    Please feel free to keep reading and contribute if you wish.

    Yours sincerely,

    Paul McConville

  28. easyJambo says:

    TBK – I’ve just loaded up a copy of Tixway UK’s last set of accounts obtained from

  29. OnandOnandOnand says:

    AWOTN and gunnerb

    See my post at 10.23. I would love it if you could shoot my logic down, I’m not precious.

    TBK, where is the cash at bank since April 2011 figure?

  30. TheBlackKnight says:

    Brilliant EJ !!

    OnandOn see EJ

  31. gunnerb says:

    OnandOnandOnand says:
    23/10/2011 at 10:48 pm

    AWOTN and gunnerb

    See my post at 10.23. I would love it if you could shoot my logic down, I’m not precious.


    I just wonder where CW found the money from in the first place. If as you suggest he borrowed say 22m to finance the deal then as you quite rightly point out not too many will be rushing to buy the newco from him.Cww started out saying he didnt know much about running a football club and subsequent events would seem to lend support to that early statement, it is the lack of transparency as to his personal wealth and the doubt surrounding his determination to run a new RFC that makes me believe he is just a frontman for what will follow.

  32. TheBlackKnight says:

    Sorry OnandOn got carried away…. Capital

  33. Paulie Walnuts says:

    The administrator/receiver dilemma is of great interest to the corporate insolvency anoraks, amongst whom I am proud to number myself.

    In favour of receivership are two things. The first is point made by the Don and others about the focus being on the floating charge holder to the relative exclusion of the unsecured creditors. The second is that a receiver almost certainly trumps HMRC, Bain and McIntyre for the arrested funds (see Lord Advocate v Royal Bank of Scotland 1977 SC 155). The key phrase is “effectually completed diligence”. On the foregoing authority an arrestment is not an effectually completed diligence without a furthcoming. So the target for HMRC is not 60 days but automatic release after 14 weeks (the post 2007 Act equivalent of furthcoming at common law). Bain & McIntyre, both of whom have only arrestments on the dependence, are well back in the queue.

    It is often said that the appointment of a receiver brings about automatic termination of contracts of employment. I am not sure that was ever true but I certainly do not see it as being true now and the receiver has the option to adopt or not.

    The only advantage of administration is that it makes it easier to get a CVA because it affords a breathing space with the moratorium on litigation, winding up etc. I would not have thought a CVA was ever a realistic possibility. Moreover, what use is a breathing space if there is no oxygen? By that I mean this business burns cash at a ferocious rate and even if it is stripped right back an administrator is going to struggle to run it for any significant period of time simply because he will run out of money.

    I agree with AWOTN that the appointment of a receiver will likely prompt HMRC to petition for winding up, and that it leaves a newco as the only show in town. But since I see a newco as beig the only realistic show in town that is where logic leads me.

    On the issue of realisations, what does he care? If the fat geese can be sold then great – easy cash to pay out Wavetower. If not then it will still be paid and it just means less for anyone else. Is there not an argument though that it suits anyone promoting the newco to have the employees suddenly looking at their contracts being worthless, with a view to assembling a squad without having to pay transfer fees?

  34. OnandOnandOnand says:

    How much did Whyte pay for Castle Grant? I note the fixed assets figure is kind of strange, a round £750,000 in 2009, I seem to remeber that’s what he paid for the ancestral pile (sorry, not his ancestors, of course)

  35. AllWhyteOnTheNight says:

    Fair enough Paulie.

    Then we get into the discussion of what league a pre-pack newco plays in.

    Is Whyte really credible enough to broker a deal at this moment with the SPL to allow a newco safe passage.

  36. OnandOnandOnand says:

    Paulie Walnuts,

    AWOTN makes good points about administration and if you ignore the CVA aspect (It just will never work, guys) then he gets up to a year to run the administration, more than time enough to get SPL rules changed, possible Carter Rucking if they don’t…………

    The Don, that might work as opposed to receivership. As AWOTN says, the administrator could do the same job and hive down. The admin route would also be good for PR as he has made the bears aware that this could happen

    There may be a problem with the prescribed part though (section 176A of the Insolvency Act for the anoraks)

  37. greengrass says:

    gunnerb says:
    23/10/2011 at 10:57 pm

    I just wonder where CW found the money from in the first place.

    could it be lbg…

  38. AllWhyteOnTheNight says:

    On and x3, no prescribed part because it’s a pre 2003 floating charge.

  39. easyJambo says:


    Tixway UK was formed in Jan 2007.
    2008 figures show Total Assets as £1.749M and Liabilities of £232K
    2009 equivalent figures are £2.003M and £177K
    2010 equivalent figures are £2.507M and £138K

  40. gunnerb says:

    greengrass says:
    23/10/2011 at 11:15 pm

    gunnerb says:
    23/10/2011 at 10:57 pm

    I just wonder where CW found the money from in the first place.

    could it be lbg…


    Doubtful. Why swap one toxic debt for potentially another given Whytes record. No I think there has been mention before on this blog regarding possible methods of finance and perhaps some are not as reputable as LBG.

  41. OnandOnandOnand says:


    It’s true that Lloyds are one of CW’s banking connections but I doubt they would give him the money. The world is a small place these days and there are plenty of people out there with other people’s money to invest and who aren’t too particular who they lend it to, as long as they earn a commission. Don’t trouble these guys for less than £20m-£30m at a time though.

    Ask me to find you £20m, no problem, ask me to find you £200k, go away………

  42. OnandOnandOnand says:

    See, AWOTN, told you that you were my admin guru…….

    EJ, I was looking at the fixed asset figure for 2009, is £750,000

  43. gunnerb says:

    OnandOnandOnand says:
    23/10/2011 at 11:20 pm


    It’s true that Lloyds are one of CW’s banking connections but I doubt they would give him the money. The world is a small place these days and there are plenty of people out there with other people’s money to invest and who aren’t too particular who they lend it to, as long as they earn a commission. Don’t trouble these guys for less than £20m-£30m at a time though.

    Ask me to find you £20m, no problem, ask me to find you £200k, go away……


    Given the difficulty you see with Wavetower finding a buyer then it does all seem to hinge on the newco being granted immediate entry to the spl with little more than the points penalty…a brave man indeed then, or a fool.

  44. TheBlackKnight says:

    Is PMcB not re-writing the rules 😉

  45. OnandOnandOnand says:


    I think a fool with an inflated ego and a complete misunderstanding of what is involved. The plan looks good on paper, just wait until the tumbleweed rolls through an empty Ibrox

  46. AllWhyteOnTheNight says:

    Does a newco get to keep all the points that oldco have amassed so far. I can’t see it. So do they just start with zero whenever they decide to join in.

    A newco in the SPL will have a lot of hurdles to get over.

  47. OnandOnandOnand says:


    I may have partaken of too much Sicilian wine, of course, if CW goes down the admin route, he will do so as a board decision (easy to do now) and won’t use his security as grounds for appointment, he won’t have power to appoint an administrator under his pre 2003 security, he will just keep that waiting in the wings to collect on

  48. AllWhyteOnTheNight says:

    Probably onandx3, the board of directors will resolve to appoint an administrator and would then have to issue a form to the floating charge holder giving notice of this. The floating charge holder would then have to consent to the appointment of that administrator or seek appointment of an alternative administrator.

    It makes absolutely no difference to how he collects on the floating charge or prescribed parts or any of that.

  49. AllWhyteOnTheNight says:

    Onand x 3, sorry see what you are saying now. A pre 2003 floating charge allows the holder to appoint either a receiver or administrator.

  50. OnandOnandOnand says:

    but if the holder appoints an administrator, does that give rise to section 176A problems? Probably a moot point as everyone is on another posting or gone to sleep……….. One for the anoraks

    Pity, the conversation was getting interesting, I thought Easyjambo’s posting of the Tixway UK accounts was interesting. Is Cw’s only visible source of wealth to be a castle and some debtors? Is the castle worth £5m as the press report when it seems to be in the books at just over £1m?

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