Hugh Adam Returns To Haunt Rangers Again – Alleges Payments to Players Were Undeclared

 

Hugh Adam is the man who made a huge success of Rangers Pools, and who served Rangers loyally for over thirty years. In 2002, he sold his shares in Rangers and at the same time rang warning bells about the direction of Rangers under Sir David Murray.

He warned of bankruptcy to come if the course of the good ship Rangers was not changed. He was ignored by almost all at the time, and as Rangers continued winning trophies and bringing star players to Ibrox he was seen as a Cassandra. However, Cassandra’s curse was never to be believed, but always to be right.

Mr Adam’s 2002 interview is still floating around on the web.

In 2009 he was again written about in the Herald.

This time, on the news that Lloyds Bank controlled the purse strings at Ibrox, he repeated his warnings of seven years previously, telling the paper:-

“When I made those comments seven years ago I was ridiculed by some. We [David Murray and he] got on fine in the beginning, but, with David, it gets to the stage that if you do not agree with him he casts you aside.

“I did not agree with the way he operated and I told him that. It doesn’t give me any satisfaction to see the situation as it is but I did raise concerns at the time and was ridiculed for raising them.

“David was a salesman, a super-salesman. I have enormous respect for him for the adversity he overcame but when I would express my concerns to him – as I did various times – he would nod, but I knew he wasn’t listening to me. He was entitled to ignore me but I wasn’t for sitting about like a dummy.

“Even if I had the money I wouldn’t buy Rangers just now. Would you?

“If anything, I would rather buy Celtic now because they are run more prudently by good, strong people. Television revenue is not going to increase, fans are not buying into it any more and there is no prospect of England on the horizon. For guys like Abramovich at Chelsea, the television money is there, while his own commitment is relatively loose change.

“I am 84, so it is a bit late in the day for me to come up with a business plan but what I would do is lobby the Dutch, Portuguese and Scandinavians regularly to champion the cause for an Atlantic League.”

Mr Adam was 84 then and it might have been thought that the book had closed on his involvement with Rangers.

However today in the Daily Mail, he comes back, and is the first former director of the Club to speak openly and, for Rangers, negatively, about the EBT issue which makes up the “Big Tax Case”.

John McGarry’s piece deserves to be read thoroughly, but a couple of points can be highlighted.

Mr Adam states, when discussing alleged “secretive payments to players which were not in their contracts:-

“They weren’t included in the contracts. They definitely weren’t. That was the whole point of them.

‘If they’d been included in the contracts, they would have had to have paid tax on them.

‘I don’t think a lot of the other directors knew an awful lot about it. David Murray kept everything to himself.

“When I was on the board, I knew all about them. I just didn’t know the details of them. They became accepted. The revenue were seriously challenging them at that point when I was a director.

“All the directors heard about them but didn’t take them seriously because they didn’t appear in the books. People didn’t want to know about them. There was a lot of that (EBTs) going on at the time (I was there).

‘You knew it was cheating but some of them not only hoped but believed it was above board. It was just something that crept up. It was considered important but not crucial. The fans didn’t give a damn one way or another.

‘When I was asked for my opinion on the way the club had been run, I said it was quite obvious how it had got into trouble. They were doing things they shouldn’t have been doing.

‘They (EBTs) were always regarded in my time as a bit of a joke. They were getting away with it but nobody really thought they’d get away with it forever. ‘

‘The players were very naive. Few of them were the Brain of Britain, of course. If they get the money, they don’t give a damn where it’s coming from.’

Mr Adam’s statements may well be challenged by Sir David Murray and by other directors of Rangers, both past and present. However his comments appear to be an admission of secret payments being made, over an extended period, to payers which did not comply with SFA and SPL rules about payments. This would, potentially, render many of the players ineligible and create a nightmare for the football authorities in Scotland to deal with.

The position as regards the players’ contracts is as follows. The contracts require to be in a standard form, and submitted to the SPL where they are retained confidentially.

The scenarios, as I see them, are as follows.

A         Rangers payments to players that were not in the contracts were not for football related matters. As far as football is concerned, the issue is closed. The taxman might still be interested mind you!

 

B         Rangers were making payments to players for footballing activities. In that event, there were two possibilities.

B1       Rangers told the football authorities this and they disregarded it. This was either:-

B1(a)   Because the authorities misunderstood what they were being told, and therefore failed to notice the breach of its own rules, or

B1(b)   Because they deliberately disregarded the information despite its own rules. If so, it makes Mr Whyte’s alleged mis-deeds pale into insignificance.

 

B2       Rangers did not tell the authorities about the payments. In which case there are the following possibilities:-

B2(a)   Rangers deliberately misled them by way of false documents for the purpose of deceiving them to their financial advantage. If so, this is a police matter, over and above footballing issues.

B2(b)   Rangers innocently misled them either by making innocent errors in their paperwork or by declaring that the full documentation had been produced under a misapprehension as to the true legal and factual position.

 

As I said, if the answer is found in para A, then the matter is over.

If in para B1, then Rangers cannot be faulted but there would need to be an inquiry into the handling of these matters by the football hierarchy to determine whether this was a mistake or a deliberate act.

If para B2(a) applies, then, as suggested, it is a police matter. For the avoidance of doubt I am not suggesting that that scenario took place. It is merely one of as number of options.

If we are in the realms of para B2(b), then, as with a mistaken SFA/SPL view, questions will be asked, but these matters are complex, and errors can be made.

I am sure the official stance will be that all rules were complied with, but one wonders if the Nimmo Smith enquiry might be widened to cover these allegations.

What Mr Adam has done, in advance of the imminently expected EBT case judgment is to offer a smoking gun in relation to allegations that, for many years, illicit payments were being made, perhaps under a mis-apprehension as to the law, which had the effect of reducing tax.

However, it is not correct to say that these payments did not show in the books. Over a number of years Rangers’ accounts recorded how much the Club aid into the EBT’s if not how much players took out.

And the revelation in the Sun on Sunday of alleged “second contracts” suggests that perhaps agents thought that they could not trust Rangers as times became harder and their clients needed written comfort.

In any event, Mr Adam’s comments are another huge blow to the credibility of Rangers over the last 15-20 years.

It also renders Mr Ogilvie’s position at the head of the SFA untenable as he would have been party to at least some of the meetings at Rangers during his tenure there when this would have been discussed.

We await more news and developments with anticipation.

 

 

 

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31 Comments

Filed under Football, Rangers

31 responses to “Hugh Adam Returns To Haunt Rangers Again – Alleges Payments to Players Were Undeclared

  1. Fisiani

    The movie of this unravelling tale will be worth watching. It’s possible titles
    No Sir Render
    Pride and Prejudice
    HMRC 1 Rangers 0
    The truth was outed
    Rangers Tax Case- the inside details
    Pound truthstretchers
    The Last Shame of Scotland
    The End of Days

  2. JenPen1975

    Tell me if I am wrong, but does the EBT not work as a loan that is never to be repaid? Is it not a liability for each player back to the club? Does this make it an asset in terms of the company that The administrators could pursue to balance the books? Would this allow HMRC to get its money back? Would this in effect still allow Craig Whyte to control Rangers after this is all concluded?

    • Tyke Bhoy

      The administrators could pursue the players for the tax that should have been deducted but even an International IP like D&P would struggle to take this through the courts of Scotland, England, Norway, Denmark, Holland, Spain, Argentina, Italy………. and wherever else those former players may now be domiciled and RFC(IA) would be out of Admin or Liquidated by then (I’ll let others decide which event is more likely but the Court of Sessions won’t let the administration go on indefinitely).

    • TheBlackKnight

      No, it is a discretionary loan that is to be paid back. The issue is whether these ‘loans’ were discretionary? ie it is reported (confirmed by Darrel King) that there are side letters stating these do not need to be repaid. That makes them not a loan, but a payment for employment.

  3. Craig

    Oh come on, the guy is 84 and it seems he has very little understanding of EBTs, probabl does not even know what the letters stand for. “A huge blow to the credibility”..no I do not think so. A huge blow to Adam’s credibility perhaps for not challenging what he thought was suspicious activity as a director.

    • TheBlackKnight

      The same would therefore apply to ANYONE associated with Rangers at board or management level since the mid 1990’s. This would also include heroes or legends that pulled on the jersey if they knowingly participated.

      This is not a can of worms, this is a ‘Lumbricus Terrestris’ factory!

    • gopaul

      it would appear from his comments
      a) he did challenge it as a director and was ignored
      b) he resigned, and those doing wrong carried on

      Still think he is a cassandra ?

      • Craig

        No he may have voiced concerns but he should have expressed those concerns in writing to the Board and Auditors, I agree with TBK that my statement does apply to anyone at board or management level, who all seem to be washing their hands of this. On a similar matter, all we hear about is bleating from Alastair Johnstone when his sole remit when he was brought in was to find a suitable buyer for the Club. Is he ever going to admit to his mistake?!

    • Carntyne

      Dream on Craig.
      Rangers are squeeky clean.
      They will come out of this stronger and will go on to win ten in a row.
      Pop!
      Whoops, you were dreaming.
      Bye, bye, Rangers. 🙂

    • NumbNuts

      “the guy is 84” and so therefore doddery and senile and not worth listening to? Ouch. At which point do the fans start to hear testimony and evidence as useful input to genuinely understanding how SDM ran the club rather than simply deride and deny it – be it an anti-rangers agenda, BBC bias, or now as being from someone who is apparently just too old??

  4. Bigman

    JenPen1975, it’s up to the employer to pay over the tax, not the employee…so HMRC can’t go after the players.

    Rangers on the other hand could call in the loans (well, they could, if the players weren’t holding letters saying that the loans wouldn’t have to be repaid).

  5. As I have stated before on here I am now of the belief that the revelations over the past month or so confirms what we all knew for a long time – basically Rangers FC did not play by the rules that everyone else in Scotland did.

    I highlighted a point going back a few years to when the goalie was in trouble with Strathclyde Police and had eventually been taken to court – his sentence was a fine and when asked what he earned he stated “one thousand pounds per week” – this was RFC at their “peak” at I for one was astonished when I heard this figure, but he insisted he would show the court his contract stating his take home pay. Now it makes clear sense that he had another contract too, one that was concealed and allowed him to live his other life – well everyone said he had a split personality !

    Seriously though if Mr Ogilvie was aware of this and I say if because MR Adam appears to say that only SDM knew all the facts then this is getting more serious by the day and I can not see anyone with an ounce of intelligence wanting to clear RFC debts only to be told they are being closed for fraudulent activity.

    • Tyke Bhoy

      Robert, while Mr Adam says only SDM knew of the full facts of the EBT’s wouldn’t as company secretary Mr Ogilvie have at least have had sight of the “official” contracts? Wouldn’t he also have wondered why the goalie was only on £1000 per week? Is it truly believable that someone who has held senior positions at 2 of Scotland’s biggest clubs and on the back of that been appointed chair of the SFA didn’t think something was amiss?

      • Hi TBhoy

        I agree with you 100% and in any proper organisation this would be the case, in no way I am trying to defend Mr Ogilvie.

        From my own personal view I always had the impression whenever I saw Mr Ogilvie that he was one of these guys that seemed super confident but like stainless steel without a blemish.

        I would find it very difficult to belive he did not know what was going on.

      • The problem is that if we are left with various SPL/SFA and possibly Insolvency Service and court inquiries, it will take yeas and we will never get to the bottom of it all.

        Maybe we need a “clean slate” as long as people tell the truth about what happened?

  6. MRObjective

    A VERY POORLY THOUGHT OUT POST FROM CRAIG VERY AGEIST AND PATRONIZING
    Craig
    March 2, 2012 at 10:34 am

    Oh come on, the guy is 84 and it seems he has very little understanding of Eb Ts, probably does not even know what the letters stand for. “A huge blow to the credibility”..no I do not think so. A huge blow to Adam’s credibility perhaps for not challenging what he thought was suspicious activity as a director.

    • Craig

      MRObjective, I do not mean to be ageist or patronizing. I assume you disagree with my point, although unhelpfully you do not articulate your reasons.

      • MRObjective

        Craig
        When he voiced his concerns he was derided as a bitter old man.
        This was a man who helped rebuild Ibrox with his very successful Rangers Pools.
        If you were not with David Murray then you were against him,and were got rid of or sidelined and marginalized. He sold his shares in the company as he saw this coming all along.
        He is getting horrendous abuse on the Rangers media boards the we are the people forget all he has done for Rangers.

  7. BFH

    I think hes 87 but not that relevent, wonder how they found him? Where was he and when did this interview take place??

  8. geddylee

    Ogilvie certainly must be having sleepless nights over this.

    I hope he has no influence at the SFA in terms of any investigation into these allegations.

    A statement of clarification from him needs to be produced ASP.

    • Tyke Bhoy

      Stewart Regan’s statment today on the SFA website says the review’s findings will be presented to the board next week. Isn’t Ogilvie chair of the board? Admittedly it will only briefly touch on Adam’s revelations given the short time frame.

    • Craig

      MRObjective, I stay well clear of the Rangers Media Boards therefore have not been aware of the horrendous abuse. I have not even read the article itself, only Paul’s quoted extracts. I just think he would have been better off with a No Comment. As a company director myself I am aware of my responsibilities and would not have been content with just taking some sort of moral high ground by speaking out. Whether he sold his shares or not is irrelevant. Rather naughty by the Daily Mail as well I guess. Not to excuse the abuse but of course people will forget what he has done for Rangers, that is human nature in the same way that noone will remember Fred Goodwyn for turning RBS into Scotland’s biggest emploer, as it remains.

  9. Johnobhoyo

    Another day down at the sham administration factory.

    Stevie Wonder with a blind fold on can see that come early next, Duff&Phelps will mysteriously procure funds around the £4.5m mark (wee Ally won the lottery or other such guff) which will se our heroes live to fight another season.

    Why are HMRC standing by watching this happen? They were quick enough to hit the jam farts with a winding-up order – why nothing for their big cousins?

  10. Frankie

    Well of course EBT payments weren’t included in contracts. That – as Adam even says himself! – was the whole point. They weren’t contracted, guaranteed payments. Silly old sod.

  11. Johnobhoyo

    I see the rumours that the blue knights are keen for the current squad to remain intact are growing arns and legs. This move is as predictable as the ending of a Parry MASON flick FFS! D+P’s motives are becoming clearer by the hour.

    Conmen!

  12. Richboy

    One group of people that sorely test my patience is conspiracy theorists. They cherry pick minor discrepancies, ignore blatantly clear facts, and go on to bore all of us with their inane ramblings.

    Is this current Rangers financial dilemma as simple as it looks (mismanagement on a grand scale, tax avoidance, illegal payments, incompetent dodgy owners etc.) or is it a massive ruse about to be played out at the expense of the British taxpayer and others in order to save Rangers?

    As stated I am not a conspiracy theorist, but you know……

  13. GOY BUNDY

    The truth will always out as they say.

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