Never A Penalty!

The Scotsman today is carrying a remarkable interview with former Rangers and Scotland coach Walter Smith. It is worth noting in a couple of respects.

This is the first interview (of which I am aware) that Walter Smith has given since withdrawing his short-lived bid to purchase Rangers. Since that time, Alex Thompson of Channel 4 News has been trying to get Smith to answer a few simple questions:

– Did you receive payment from any of the EBTs Rangers / Murray Group established to make tax-free payments to employees?

– If so, when did you receive these payments?

– If you received such payments, were they significantly after your employment with the club ended?

– If you received payments long after your employment ended, for what purpose were they made?

Of course, I have no way of knowing if the journalist, Alex Gordon, has ever heard of Alex Thompson or follows my twitter feed. Scottish journalist doing research? After recent reports that 83 Rangers employees had received tax-free payments through the EBT, it would be a fairly obvious line of questioning. That another former manager, Graeme Souness, received a series of payments through the EBT scheme ten years after he resigned also raises some awkward questions. If Mr. Smith did not receive any payments, or if such payments are easily explained, I am sure that he would have welcomed the opportunity to clear any misunderstandings. Oh well. back to you Mr. Thompson.

Walter Smith’s interview can be seen as part of the PR deluge of terrifying stories about the great disaster that will befall Scottish football if Sevco 5088 Ltd is not allowed to enter a team in the Scottish Football League system with instant promotion to the first rather than the third division. This past weekend has seen many such articles and we should get used to more shrieking hysterics as we approach some kind of decision point. (Such is the bureaucratic incompetence within the organisations that run Scottish football, no one is exactly sure when a final vote might take place).

Mr. Smith might be a genius at constructing anti-futbol defences (I do admire his pragmatic approach to coaching), but he is either being disingenuous in this article or is struggling to grasp the administrative details. Smith is reported as saying: “Ten years ago Motherwell went in to administration. Four years ago Gretna went defunct. So, surely the SFA should have put sanctions in place then? That’s why I am saying they have been negligent. Now we’ve got a free-for-all around Rangers and everyone is having a kick at them”

This is a great example of the type of factually incorrect statements that the Scottish media is fond of regurgitating. As the old cliche says- an untruth repeated often enough is eventually accepted as fact. So let us refresh Mr. Smith’s memory.

The SPL introduced the 10-point penalty for going into administration during a season, or being in administration at the start of season, for the beginning of the 2004/05 campaign. Motherwell (and Dundee) were already in administration when the new rule came into effect. Both clubs were able to conclude CVAs fast enough to avoid the 10-point penalties and  to continue the life of the existing legal entities. The same rules that were introduced then have been applied to Rangers. The SFA are a bumbling shambles, but let us assail them for their actual mistakes. It is not the SFA or SPL’s fault that HMRC want to pursue investigations of what happened at Ibrox in the last 11 years and would not agree to a CVA.

The case of Gretna is actually similar to what happened to Rangers FC. Gretna owed its creditors (including HMRC) more than it could pay and the club went into administration in 2008. Unable to fund a CVA that was acceptable, Gretna FC was liquidated. That was the end of the Gretna story. Supporters formed a new club, Gretna 2008 FC and were admitted to the East of Scotland Football League. (Those of us who would accept a Sevco 5088 Ltd team entering the third division are actually still offering this club a huge advantage over every other newly formed team). If only Gretna had Duff & Phelps on the case to promote fictions such as the one that says that a liquidated company lives on so long as its assets are sold as a job-lot rather than individually.

Mr. Smith appears to be deliberately trying to confuse us and drum up sympathy for the new club. The only punishment that has been administered in the Rangers saga was to the old Rangers FC for experiencing an insolvency event. The rule that applied this penalty has been on the SPL books for eight years! (The SFA does not need to have a separate punishment).

As yet, there have been no penalties applied for the oldco Rangers FC pocketing the millions of pounds that were deducted from players’ wages to be paid in tax while other clubs paid their dues.

As yet, there have been no penalties applied for oldco Rangers paying the majority of their players through a mechanism that is, at best, in violation of SFA and SPL rules. I expect that when the First Tier Tribunal (Tax) returns with its findings in Rangers’ appeal of the Big Tax Case, that use of an illegal tax strategy will be added to the list of offences. If found to be using the EBT scheme illegally, it will prove that Rangers obtained the benefit of paying its players with money it did not have. How can Smith complain about penalties that have not been levied yet?

We all know this stuff already, as I am sure, Mr. Smith does too. There is a studied ignorance that has become fashionable in certain circles of late. They pretend to not understand the facts. In this case, Smith is trying to drum up support for the notion that people have been “kicking Rangers while they are down” and “haven’t we been punished enough”?

Let us be fully aware of the truth: The Rangers Football Club plc has not yet been punished AT ALL for its actions of the last eleven years.

There is a simple way for Sevco 5088 Ltd to avoid all talk of sanctions and punishment. Apply for entry to the Scottish Football League third division without claiming that a transfer of the oldco’s SPL membership has taken place. By not forming any ties to the old club, Sevco 5088 Ltd can avoid any historical liabilities. My guess is that all concerned- the SFA, the SPL, and the clubs would breathe a sigh of relief and would be delighted to draw a line under this disaster. However, time is not on their side. If Sevco 5088 Ltd is to field a team of any description next season, an acceptable solution must be found quickly.

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 are for one of the largest football clubs in Britain.

5,668 Responses to Never A Penalty!

  1. Private Land says:
    12/07/2012 at 3:58 am

    HoopMajestic (@Accies1874) says:

    12/07/2012 at 1:11 am
    Could you all email (be nice) as it seems Rangers fans email them as well as fans of other clubs and try to explain how you feel without threats etc, just give them plain facts that RTC is known for.

    Mails are bouncing: “No such mailbox” error

    If you resend it to he will pass it on to everyone involved he says.

    Sorry you guys got a bounced email and thanks for emailing and I hope you’re successful this time.

  2. Private Land says:
    12/07/2012 at 3:58 am

    HoopMajestic (@Accies1874) says:

    12/07/2012 at 1:11 am
    Could you all email (be nice) as it seems Rangers fans email them as well as fans of other clubs and try to explain how you feel without threats etc, just give them plain facts that RTC is known for.

    Mails are bouncing: “No such mailbox” error

    If you resend it to he will pass it on to everyone involved he says.

    Sorry you guys got a bounced email and thanks for emailing and I hope you’re successful this time.

  3. stunney says:

    With Cadaver FC awaiting burial, wouldn’t it be nice if a place in the coffin could be found for Sevco before it did any more damage to the game in Scotland its disorderly and disruptive appearance has already brought to the brink of ruin?

  4. Foolsgold says:

    Scotsman online poll numbers:

    Thursday, 12 July 2012

    What league should a newly-formed Rangers be allowed to play in next season?

    690 (2%)

    Division One
    604 (2%)

    Division Two
    125 (0%)

    Division Three
    29424 (95%)


    Surely the correct answer is, none of the above ?

  5. OLE MUNGO BHOY says:
    12/07/2012 at 12:42 am
     17 0 Rate This
    Walter says:

    Off topic

    I hear that Joe Mcbride ex Lisbon lion passed away in hospital tonight … Condolences to family, friends and all those closest to him

    I can still see Joe’s smiling face on the football cards we used to get with tea and chewing gum. Not all of the players on those cards wore smiles. Heard he’d been taken bad the other day. I think Joe played for few a clubs. I remember him as a prolific goalscorer and a fine Celt. There’s a phrase they use over here when someone passes: ‘Aeret vaere hans minde’ – literally, ‘Honoured be his memory’. Sad indeed.

  6. Barney says:

    CE says:
    And incase this slipped through the net today, Sevco have announced a shiny new pre-season fixture list. Some big hitters in here:

    Sat 21st July… Hawick Royal Albert (A),

    Maybe looking for some tips from the home side?

  7. TMC says:

    I read a comment from one club chairman stating that it would be best for his club if Sevco were allowed to join Div1 as then Airdrie would not be moved up a division, thus maintaining a local derby and increased income. I can see the logic even if I disagree with the principal but if we apply that logic in all circumstances then what happens in this scenario:

    Last day of the season, 2 clubs on same points, Team A & Team B. The club that ends the day with the best result will be promoted. Team A is your biggest rival and that rivalry brings a lot of revenue to your club on derby day, today you are playing Team B. Now if you let Team B win (with a big margin), then Team A will have a tough job to get promoted, this is good for you as then the revenue stream is protected for next season.

    But this of course would go against the principal of sporting integrity…..

    Div1 or Div3?

    It is a simple choice.

  8. “This group will have an independent chairman appointed by the SFA. They will be tasked with delivering by 30 November, a recommendation for structural change effective 2013/14.”

    In the event that a final decision is not reached by 30 November, the SFA will move to implement the changes.” So says the BBC Sport website [for what it’s worth].

    So, if the SFA will go ahead anyway, why is it wasting time setting up an independent committee. More to the point, what has any of this to do with which Division a replacement for the liquidated Rangers should do into? What a shame that there are no rules to govern what happens when a team goes into liquidation!!!!!!!! Oh, wait a minute there are rules, look, over there, in that dark corner, hidden under that pile of rubbish that has been written over the last few weeks.

  9. Henrik Larsson says:

    I don’t post often, but am a 24/7 avid and long-term reader (like a few of us), I think that everyone should read Henry Clarson’s latest blog as it really is a fantastic piece and lifts the blinkers off of the ongoing deception that was, and continues to be, ex-RFC. (see the previous page for the link)

    Henry, if you are reading: un grand chapeau!!

  10. Fara says:

    If Chucko agreed to pay 2.75mill for players contracts and then the players either can’t register,(no SFA license etc) or refuse to register with sevco, (the daywalkers). Does that mean he can back out of making that part of the agreed price? Now that would have been a cheap way to buy the real estate if he could.
    Funnily enough wouldn’t the remaining 2.75mill be just a bit more than required to pay puff n helps fees?

  11. joe mccormack says:

    Fara 8.54am

    As it would appear that Hughie at the moment has only paid the Duffers a deposit it seems likely that by the time he’s due to cough up the balance there will have been a court or FIFA ruling on the players who have refused to TUPE across.
    If as expected it goes against Hughie then I would imagine he will deduct the £2.75m from his payment to D&P.

    Their fees wipe out the balance leaving zero for the creditors.

  12. Mark Dickson says:

    What the SFL board and SPL & SFA bribers haven’t seemed to have fully thought through is that if the SFL clubs put Sevco into Division 3 then they will still be able to force through all the same reconstruction changes and probably on an accelerated timescale if the SPL clubs really need “Rangers” back in the SPL as soon as possible.

    Put them in Division 3, justice & fairness is served and you will still get the SPL & SFA come begging to your door wanting & threatening to push through reconstruction changes as they still need/want Rangers back sooner than 3 years time.

  13. Tommy B says:

    As is so clearly pointed out by Henry Clakson’s blog, manipulating the masses is simple. However, the chairmen who meet tomorrow may still be steered in a direction other that the one that the SFA, MSM et al are attempting to direct them down. Hopefully there are enough voices within their ranks making it clear that the great propaganda machine has been at work and that what is being indicated is not necessarily true. All the talk of armageddon and bankrupcy is scaremongering in the extreme. There will be difficulties amongst clubs in the top tier but attention to detail and good housekeeping will allow them to create budgets that they can live with. As for the lower level clubs, the impact will go almost unnoticed, other than a reduced transfer market, their income will not be be substantially different. Indeed lower leagues may benefit in the time that newco spend amongst them.
    Scottish football, is rightly considering reconstruction, but it should neither be hurried, or done to accomodate the club that have contributed more to the problem than any other.

  14. New statement on Clyde website.

  15. New statement on Clyde website

  16. Myan Man says:

    Where is fraser wishart? Cat got his tongue? Why is it Sport Lawyers defending RFC(iastbl) players who have gone elswhere and not the union man?

  17. joe mccormack says:
    12/07/2012 at 9:45 am

    If as expected it goes against Hughie then I would imagine he will deduct the £2.75m from his payment to D&P.


    I would assume that there is a breakdown of the £2.75M for each player in the squad at the time of purchase so the value of the contracts signed over to Sevco can be re-assessed.

    How does Green evaluate Lee Wallace’s contract? Is it the transfer fee that Old Co agreed to pay Hearts (£1.5M) or the actual amount paid as of 14th February (£700K)? Surely Green will sell Wallace before the transfer window closes as he’d be too expensive to keep for Div 3.


  18. Here’s a question: (all establishment bias aside) will the new improved Rangers FC (no relation) win Div 3? TU for YES, TD for NO.

    The reason I ask is that given their current small squad of mollycoddled ‘SPL’ players, life where they are up against teams full of Elbows McCullochs may turn out not as McCoist expects. Personally, I can see them having problems if the team has to be augmented with players from the U19/20s. Especially, if the SFA finally gets its finger out and enforces the player transfer embargo.



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