I posted the full 63 page and 26,000 word judgement here earlier for those who had not read it. It is a remarkable, to coin a phrase, statement. It lays out in forensic detail the full horror of Mr Whyte’s running of Rangers since he bought it, and the failure by anyone connected to the football club to try to stop him.
There can rarely have been so damning a judgement of a sporting club and club officials without downright criminality taking place. In addition, it makes crystal clear why Rangers, along with Mr Whyte, were “convicted”.
The judgement is attributed to Gary Allan QC, one of the three Panel members, although all will have contributed to it. It is clear to see the influence of Mr Allan’s vast experience and great expertise in these regulatory and disciplinary matters. As a frequent advocate appearing before such tribunals, and advising on the conduct of them, he would have been well aware of what needed to be said to counteract the arguments that would have been forthcoming whatever the verdict.
As we saw, finding against Rangers unleashed a torrent of vitriol, and demands for the “unmasking” of the anonymous Panel members. This included what might be considered imprudent words by Ally McCoist in publicly declaring that the names should be released. Mr McCoist has stated that he did not know the Panel when he made those remarks. As representatives of Rangers and of Duff & Phelps had attended all six days of the hearing, and as Rangers had been given the names in advance of the hearing in case there were any objections, it is a pity that Mr McCoist did not ask the question inside Ibrox. It can only be the case that he received no reports of the ongoing procedure. If he had then one assumes the names of the Panel would have been included, or at worst, there would have been no dubiety about whom the manager should ask.
Equally, if the verdict had cleared Rangers, there would have been an outcry, this time alleging an SFA “stitch-up”. Therefore the Panel, led by Mr Allan, have provided a step-by-step guide to how the mess arose, and the responsibility for it.
I should say, in that regard, that the judgement cleverly, and correctly, uses a device judges utilise to reduce the chances of a successful appeal against their decision. If a court or Tribunal hears evidence which is inadmissible or legally irrelevant, or there occurs an event outside the courtroom which could influence what happens in the judge’s mind, the prudent decision maker will mention this in the verdict. The prudent judge will then confirm that, notwithstanding the irrelevant or inadmissible evidence having been heard, it was disregarded, and played no part in the determination of the issues.
Whilst one is reminded of the witticism of AP Herbert, that asking a jury to disregard something they have heard is like “bringing a skunk into the court and asking them to disregard the smell”, judges are treated as more easily able to rid their minds of such material.
Therefore, unless a decision manifestly is based on such irrelevant, inadmissible or extraneous “evidence” then there can be no attach on the decision where the panel states that the material has been disregarded.
The main issues before the Panel related to the following:-
1 Was Craig Whyte guilty of any of the “offences” with which he was charged?
2 Was Rangers FC guilty of any of the “offences” with which it was charged?
3 Was Rangers FC culpable for the actings of Mr Whyte?
4 If a guilty verdict was returned, what penalty should be imposed on Rangers and upon Mr Whyte?
Dealing with them in turn, Mr Whyte, despite some public badinage, failed to turn up, citing security concerns. It is fair to say the Panel was sceptical of this!
His solicitors withdrew from acting for him, and the Panel proceeded in his absence, taking his stance as being one of complete denial.
Rangers FC was highly praised for its conduct of the disciplinary hearing. It is clear that the attendance of the various parties representing Rangers, including the solicitor from Biggart Baillie, resulted in the case resolving on 6 days, where with a less focussed representative, the case could have run on further.
It is clear from the judgement that few, if any, of the factual findings were challenged by Rangers. Instead the defence was mounted on the question of nuance of language, seeking to argue that faults might not amount, for example, to bringing the game into disrepute, and also based on the question of equity, namely that Rangers had been “duped” too by Mr Whyte. Unfortunately for Rangers, their representative was forced to concede that the law on the point was clear. In circumstances such as this, where Mr Whyte was the “controlling mind” of the company, the company was deemed to have carried out the acts and thus rendered itself liable to punishment.
Moreover, the Panel found that there was a catalogue of failures by remaining employees and directors of the football club. As they put it:-
“Against that it took the view that whatever their position a number of individual directors and employees must have known that what was happening within Rangers FC was entirely wrong and illegitimate but they chose to do nothing to bring it to the attention of the public. That may be matter for their long term reflection but it does reduce the mitigatory impact of the suggestion that Rangers FC were innocent victims.”
The Panel also determined:-
“On any view the matters involved in this case are as serious offences against the ordinary standards of corporate governance as one could imagine. The Tribunal attempted in its exercise of fixing these matters on the scale of offences to identify a more serious offence than those on the complaints, and concluded that only match fixing in its various forms might be a more serious breach. It had no hesitation in concluding that the breaches struck at the heart of good corporate governance and social and financial probity and responsibility. They brought the game into serious disrepute. As such, they required to be regarded as at the top of the scale of seriousness.
In the case of the non payment of tax (which was possibly by the smallest margin the most serious breach) the massive extent of the failure and the intentional and calculated manner in which it was carried out aggravated the breach even further.”
I think the tax issue is a key to the whole decision. The Panel, as stated above, viewed this as the most serious of the many serious matters. The sums involved in PAYE, National Insurance and VAT all represented taxes which, almost entirely, had been deducted from employees or received for sales, in either case for onward remittance to HMRC.
The Panel identified the sum of £13 million as having been retained within the company.
If Mr Whyte had been an out and out rogue, who had headed for the hills with a large bag containing the contents of the Rangers bank account (and there is no proof of criminality on his part although various people have made such allegations) then this would have been better for Rangers, It could have argued that they had been the victims of the theft, if there had been one.
However, the unpaid tax was spent on other bills FOR THE FOOTBALL CLUB.
Indeed the sum of over £3 million which was in Rangers bank when D&P were appointed and which has been rapidly dwindling since then, is almost certainly money from the unpaid tax amounts!
Rangers might argue that Mr Whyte’s dealings with Ticketus deprived it of money, but again £18 million of the Ticketus money paid off debt owed by Rangers, to the Lloyds Banking Group, and thus benefited Rangers. After all, even although Mr Whyte claimed the assignation of the debt to his company, it was not looking for payment from Rangers.
Therefore, although entirely innocently, Rangers benefited from Mr Whyte’s change of plan regarding tax ie his decision to stop paying it.
Therefore, on the legal ground, the basis of which was not challenged by Rangers; on the basis that Rangers benefited from the non-payment of tax; and various Rangers directors and employees were aware of what was happening but failed to take action to stop it, there is no doubt in my mind, nor was there in the minds of the Panel, that Rangers were guilty as charged as regards the “disrepute” charge.
Put another way, if Mr Whyte had paid taxes as they fell due, Rangers would have run out of money last year. Therefore the non-payment of tax permitted the company to continue when the cash ought to have run out.
Bearing in mind the importance of payment of taxes, it is arguable that the Panel were too lenient in their decision about sanctions on Rangers!
“What does ‘financial fair play’ really mean? UEFA’s explanation, in 2010, was that the concept would require clubs to balance their books over the medium term, not spend more than they earn, and operate within their financial means.
This is all seen as important for one key reason: because any club that is spending more on players than they can afford, is automatically gaining a sporting advantage over every other club it competes with. Whether the precise system of measurement used by UEFA is perfect is a moot point. But the logic behind the principle however is, I think, broadly sound. And it is this same principle that explains the position of the SPL.
To turn a blind eye, to allow clubs to continually fail to make prompt payments as they fall due, would be to allow those clubs to gain an unfair sporting advantage over all those other clubs that pay their players, the taxman and other clubs on time.”
So, although the SPL was not part of this disciplinary process, the CEO of that organisation characterises the failure to make prompt payments as “gaining an unfair advantage”.
One wonders therefore what penalties the SPL might wish to consider against Rangers. After all, the prize money to which Rangers is entitled has come about following most of the season spent with Rangers “gaining an unfair advantage”. Shouldn’t the teams below Rangers, who lose out financially as a result of the “unfair advantage” gained by Rangers deserve to step up the prize money ladder?
It is not as though there is any prospect whatsoever of Rangers, whether by CVA or liquidation, ever paying back the £13 million unpaid tax from the Whyte era, never mind a penny of the Big Tax Case and Wee Tax Case!
The SPL chairmen who have commented that financial imperatives outweigh sporting integrity are themselves victims of this “unfair advantage” gained by Rangers. The unpaid taxes this season amount to far more than the wage bill for every SPL team except Celtic.
In terms of “unfair advantage” was this like fixing rockets to Usain Bolt’s running shoes before the 100m Olympic final!
However Mr Doncaster has made little or no comment, as far as I have seen, on the Rangers decision. Bearing in mind that the SPL sought to take disciplinary action against Hearts for being, arguably, one day late paying its players wages, under the “utmost good faith rule”, how much more should such a case be justified here?
Rangers have gained what the SPL CEO would describe as an “unfair advantage” which has financially benefited the club (and might now be what is keeping the doors open) and yet the SPL and the SPL clubs are saying nothing.
I will say again, every club which finished below Rangers has a legitimate argument that they should move up one space in the table, with the increased prize money due to them.
It might seem like piling on Rangers, but the catalogue of horrors, which I will look at in further detail, makes it clear that the whole organisation has benefited from the acts of Mr Whyte, and there has not been a word of contrition.
Posted by Paul McConville