Some Questions For David Grier and the Administrators of Rangers

In which I explore the nature of conflict of interest, wonder why Duff and Phelps accepted appointment, wonder why Andrew Ellis was not appointed a director on takeover, as was intended, and ask some questions of Mr Grier of Duff and Phelps.

Some of those questions are below.

What were D&P told by Craig Whyte about sources of funding in the period from January 2011 to April 2011 when D&P was negotiating with the Bank re clearing Rangers debt?

If it was D&P’s primary role to provide assistance to Liberty Capital in negotiating a settlement and assignment of the debt due to Lloyds Bank, what was its secondary role?

When did Mr Grier’s concerns re Ticketus crystallise?

Why did he speak to HMRC about these concerns?

Why did he speak to the “controlling directors”, who one assumes were the people involved in what concerned him? After speaking to them and HMRC, why did D&P continue to act? Presumably his concerns were allayed?

Did Mr Grier have indirect contact with Ticketus, or did anyone at D&P have direct contact pre-takeover? What about post-takeover? Did discussions to which D&P were party regarding Ticketus involve Ticketus?

Did D&P provide written advice re HMRC pre-takeover?

Why does the Report to Creditors make no mention of D&P being engaged pre-takeover to give advice re HMRC and regarding the effect on insolvency of a funder of season tickets?

Was the alleged Collyer Bristow letter the only information seen by D&P showing that Mr Whyte had access to £33 million?

Did D&P give any advice to Mr Whyte regarding the wisdom of his purchase, bearing in mind he was asking about insolvency prior to spending £33 million on the purchase?

Did Mr Grier read the 19th April email referred to by the BBC? If he did, was his curiosity not piqued by reference to “Ticketus agreements” (plural)?

How could financial projections show that money was coming from Wavetower, which had no money?

What did HMRC do about Mr Grier’s concerns?

Mr Grier refers to discovering the FULL extent of the funding relationship with Ticketus. Did D&P know part of the funding relationship previously, or the nature but not the full extent?

Did the cash flow projections prepared by D&P post takeover include reference to Ticketus, either in terms of short-term funding, or the £20.3 million “understood” to have been paid? If not, and as the forecasts were, inter alia, for the purposes of negotiating with HMRC, was false or incorrect information provided to HMRC?

Is the invoice referred to in Mr Grier’s email dated 24th June the same as those referred to in Rangers Financial Controller’s evidence to the SFA Judicial Panel, namely the multi-million pond invoices to Ticketus which were completely unknown to the Financial Controller, and were prepared using clip-art?

If Mr Grier was preparing invoices for Rangers to Ticketus, how is this covered in the statement in the Report to Creditors of what D&P did prior to appointment as administrators?

If Mr Grier was preparing invoices for Rangers to Ticketus in June dated May, how did it take him “over the summer” for concerns to crystallise?

Why do Mr Grier and D&P consider there is no conflict of interest?

Whilst D&P were assisting Rangers with short-term cash flow projections, £3 million was paid to Ticketus. Did Mr Grier make enquiries as to what this related to?

Could he or his colleagues prepare forecasts and projections without knowing the nature of the payment to Ticketus, and further liabilities to them?

By August 2011, D&P was monitoring cash flow and discussing capital raising. Had Mr Grier’s concerns crystallised by then?

I want to make clear that Mr Grier and Duff & Phelps have vigorously maintained that they have acted at all times with consummate professionalism and that they have at no time failed in their legal duties. I am sure Mr Grier and his colleagues would have answers to all of the questions raised above. However these seem to be reasonable queries arising from the statements made by D&P. I do not intend any negative connotations for D&P to arise from these questions. I merely pose them as a matter of interest.

(I refer to D&P throughout this piece, even where the work was done by MCR, taken over by D&P last year.)




Duff & Phelps describes itself on its global website as follows:-

A leading global financial advisory and investment banking firm, Duff & Phelps balances analytical skills, deep market insight and independence to help clients make sound decisions. The firm provides expertise in the areas of valuation, transactions, financial restructuring, alternative assets, disputes and taxation. With more than 1,000 employees, Duff & Phelps serves clients from offices in North America, Europe and Asia.” (Emphasis added).

Scroll to the bottom of the page linked above and you see the last entry in D&P’s global timeline – “2012 Administrator for Rangers in the largest football club insolvency in UK history”.

This suggests that D&P’s bosses in New York were, at least at one point, delighted to be involved in such a high profile case. One suspects that the senior partners might now wish never to have heard of Rangers. A job which could have propelled them into the top echelons of Insolvency Practitioners in the UK, and earned a good fee into the bargain, has turned into a disaster. Numerous variations of the name, from Duff and Duffer onwards poke fun at the firm and the administrators appointed by Craig Whyte. This appointment is now a poisoned chalice.

The BBC documentary on Wednesday, presented by Mark Daly, made damning allegations about the conduct of D&P, and particularly David Grier, one of the firm’s senior partners in the UK.

Clearly D&P knew what was coming, as a statement was provided to the BBC prior to the programme. They have since come out fighting, threatening legal action, and welcoming a possible investigation by the Insolvency Practitioners Association.

I thought a look at the statement by D&P, when combined with the allegations put to them, and any other information available could be of assistance. Of course I note the statements by D&P indicating that they have done nothing wrong, and of course in the absence of evidence that they have, I must accept that. It is fair to say though that a number of questions arise, which I am sure are capable of being answered in a way which maintains D&P’s reputation for honesty and probity.

I will be referring to parts of the D&P Proposal to Creditors, found here – Duff and Phelps Proposal 5 April 2012

I think it is ironic, though not, I am sure deliberate, that the first part of the section entitled “Events Leading up to the Administration” reads as follows:-

“5.1 The information provided below is largely based upon the Company’s records and information provided by the Company’s management, the accuracy of which the Joint Administrators are not in a position to verify. Neither, the Joint Administrators nor Duff & Phelps can be held liable for errors or mis-statement of fact contained therein.”

It then proceeds to take a page to tell us about the involvement of MCR and D&P with Rangers pre appointment as administrators! Presumably D&P can be relied upon to confirm their own involvement in matters!


I reproduce the Duff and Phelps statement below, with my comments and observations marked in bold below each relevant section.



The following information was given to BBC ahead of the broadcast of Wednesday’s programme:

David Grier, who was the engagement partner at MCR, said: “I categorically deny that at the time of the Craig Whyte takeover of Rangers, I had any knowledge that funds from Ticketus were being used to acquire the Club. This accusation is wrong, highly defamatory and betrays a lack of understanding of the facts.

MCR was of course the firm which acted in connection with this matter and which was taken over by D&P. Accountants are expected to be accurate and precise in what they say. It is therefore jarring to see the terms used by Mr Grier. Clearly he does so to make the position more comprehensible, but a suspicious person could, quite unfairly, see him coveting himself.

He refers to the “Craig Whyte takeover of Rangers.” Of course the takeover was by Wavetower Ltd, now Rangers FC Group Ltd. That company, which acquired 85% of the Rangers Football Club PLC’s shares, was entirely owned by Liberty Capital Ltd. In turn we are led to believe that Mr Whyte owns 100% of Liberty Capital Ltd. In layman’s terms, Craig Whyte took over Rangers. In fact and law it was Wavetower Ltd.

Mr Grier also denies knowing that “funds from Ticketus were being used to acquire the Club”. But they were not. The club cost Mr Whyte £1. The Ticketus funds were to clear off the bank debt.

Mr Grier denies the allegation made against him, although the terms of his denial are, for the nit-picky reasons mentioned, not dealing with the precise allegation against him.


“Neither I nor any of my colleagues at MCR provided any professional assistance to Liberty, Wavetower or Craig Whyte, in raising funds, performing financial due diligence, structuring or agreeing the terms of the purchase of the Club from the Murray Group.

Now would be a good time to look at the D&P Report for Creditors, produced in April 2012. Can we see what MCR, as it then was, was doing in connection with Rangers in early 2011?

“In January 2011, MCR BC (now part of Duff & Phelps) was engaged by Liberty Capital an investment vehicle, to assist with its negotiations with LBG as part of its intended acquisition of the shareholding in the Company from MIH. An agreement was reached in principle with LBG in April 2011 in respect of the debt that LBG required to be settled upon completion of a sale.”


So in January 2011, MCR was advising Liberty Capital Ltd (effectively Mr Whyte) in connection with Liberty’s planned acquisition of the Rangers shares. This help was to agree a settlement with the Lloyds Banking Group, and this duly took place. Therefore by April 2011, it appears that D&P (as I will refer to them) had brokered the deal to pay the Bank £18 million to clear the Rangers bank debt. Despite great speculation on the Rangers Tax Case Blog at the time, it appears that Mr Whyte/Liberty/Wavetower did not get a discount but had to repay the full sum. What took them three months to tie up the deal? Did the conversation go like this?


D&P – “I know Rangers owe the Bank £18 million. Can we settle it at £10 million?”

Lloyds Banking Group – “No”

D&P – “Go on, go on, go on, go on…..”

LBG – “No. £18 million.”

D&P – “OK”

That may have taken three months…

Mr Grier’s comment here is very precise, denying that he or his colleagues – “provided any professional assistance to Liberty, Wavetower or Craig Whyte, in raising funds, performing financial due diligence, structuring or agreeing the terms of the purchase of the Club from the Murray Group.”

However, if one is acting for and negotiating on behalf of that client, which is a company based in the British Virgin Islands, one imagines that you, or the Bank, or indeed both, might ask where the £18 million was coming from. Over and above that, it is not enough just to get an answer, but there requires to be documentation to establish the source of the funds. D&P may not have needed that for the purposes of money laundering regulations, especially as it was not going to hold or transfer funds from Liberty/Whyte, but the Bank would need to know and Mr Whyte would need to tell D&P. What did he tell them in January 2011? What evidence if any did D&P see then of funding?

“Financial due diligence and other work was provided by Saffery Champness, a firm of chartered accountants who specialise in this area, and our primary role was to provide assistance to Liberty Capital in negotiating a settlement and assignment of the debt due to Lloyds Bank.

This is an interesting phrase. D&P’s PRIMARY role was to assist in the bank deal. What were its secondary or tertiary roles? The “Proposals” document does not mention anything other than the bank deal, and this is not qualified by the use of the word “primary”.
“The reality is that when my concerns about the use of Ticketus funding crystallised over the summer of 2011, I took immediate steps to raise these concerns with controlling directors of Rangers and HMRC.

“I had no direct contact with Ticketus prior to the takeover by Wavetower, however we were aware and were party to discussions regarding Ticketus as a recognised source of short term working capital that was used by the Club and that could be a source of such continued funding. These discussions are well-minuted.

Mr Grier tells us that, on his concerns re Ticketus crystallising in the summer of 2011, he raised this with the “controlling directors” of Rangers and with HMRC. The “controlling directors” were Craig Whyte and Phil Betts at that time. How did that conversation go?

David Grier – “Mr Whyte, I have concerns about the use of Ticketus’ funding and these concerns have crystallised.”

Craig Whyte – “Thank you Mr Grier. Two sugars please.”

David Grier – “Ok”

(Please note the above dialogue is created in an effort to leaven this slab of text with humour and is not intended to reflect or record any event which may or may not have taken place.)

He also saw fit to raise the issue with HMRC? In what context? What about duties of client confidentiality? One assumes he did not see criminality, for example. As he would be duty bound to do more than mention is to the alleged criminal, one imagines, and if HMRC was advised of criminality, one hopes that some action might have been taken.

Mr Grier says that HE had no DIRECT contact with Ticketus PRE-TAKEOVER. Did he have indirect contact, or did anyone at D&P have direct contact? What about post-takeover? He mentions that D&P were party to discussions regarding Ticketus. Did they involve Ticketus, or was that simply a conversation topic? What about the email of 19th April 2011 seen by the BBC and linked to here? Or the meeting of 24th April, referred to here? I will come back to them.

Presumably, as D&P continued to act for Rangers/Liberty his concerns were allayed?

“At the time there was significant uncertainty surrounding the potential outcome of the ‘big’ tax case, which could result in the Club being unable to meet a potential liability and therefore face insolvency. As a result we were asked by Liberty Capital in April 2011 to provide advice in writing to them in relation to our view on the possibility of agreeing a time to pay arrangement with HMRC.

“At the same time we were also asked to confirm our opinion of what rights a funder of future season tickets would have in the event of an insolvency. This was in contemplation of funding a time to pay arrangement with HMRC.

“As we were not aware of the nature and extent of any arrangements for season ticket sales we were unable to provide specific advice without full detail and our letter of 7 April 2011 is clear on this point.

“Indeed we state in this letter that we had not had access to documents or knowledge of contractual terms either of any proposed ticketing agreement or proposed purchase from the Murray Group and as a consequence we could not provide further advice without this detail. We did not receive further information and therefore we could not provide further advice on this matter.

According to Mr Grier, D&P were asked, in April 2011, to provide advice regarding a time to pay arrangement with HMRC, and to confirm what rights a company sounding awfully like Ticketus would have in the event of an insolvency.

Three things arise in this regard.

First of all, he mentions that they were asked for written advice re HMRC. Did they provide it? If not, why not.

Secondly, D&P must be complimented for having a very clear letter written stating what they cannot do, and why, thus ensuring that anyone looking at the file would see their clear communications with their client.

Thirdly, the D&P “Proposals” document makes no mention of these instructions at all. Therefore, on the face of it, the D&P Engagement section of the Report is inaccurate. Now that section is not one which D&P accept responsibility for, but as it involves them, one would hope that it was accurate.

Therefore, why was the reference to these two matters omitted?

“At the time of the acquisition, Craig Whyte indicated that he would be able to fund settlement of the big tax case of up to £15 million but we were not involved in the raising of funds or providing corporate finance advice.

So we now have a position where Mr Whyte needs to find £18 million to pay off Lloyds Banking Group, and £15 million to put aside for the Big Tax Case. What evidence or information did Mr Whyte give to D&P, between January and April 2011 regarding his source of funds? £33 million is a lot of money!

It also seems odd, though I am not versed in the world of high finance as Messrs Whyte, Betts and Grier are, that Mr Whyte is pursuing an acquisition of a company where he is having to find £33 million of funding, and at then same time is asking detailed questions about insolvency. That might be the actions of a prudent man, of course.

Bearing in mind though that, according to Mr Grier, the Ticketus involvement would only be for short term working capital, this suggests one of two things to me. Either D&P thought they had a client who was willing to fund a £33 million purchase and at the same time was contemplating imminent insolvency and the effects of one short-term facility or they knew or suspected that this was not short-term funding at all. However, as the latter has been denied, the former must be the case. In that event, would professional duty extend to suggesting to your client that the deal seemed all wrong, and that talking on a £33 million liability, when there remained the undecided tax case was a complete gamble?

“We were provided with a copy of a draft email to Ticketus dated 19 April 2011 that mentions the possibility of raising funds, but does not provide any information of quantum or terms of such a proposal. To suggest this email establishes an awareness of Ticketus providing acquisition funding is absurd and ridiculous.

What does the “Ticketus” email say? First of all, the email the BBC produced, and which is linked to above, is not a draft of an email to Ticketus although it refers to one. However, it is entirely about the acquisition. It was sent by Gary Withey of Collyer Bristow and refers to an earlier discussion that day.

The email looks ahead to completing the acquisition the next day.

Para 5 states “A notice will be presented to the club by the then majority shareholder requesting the club requision (sic) a general meeting for the purpose of removing all the directors and appointing in their stead, Craig, Phil and Andrew.”

Para 6 states “Upon the holding of this general meeting or the earlier when Wavetower gain board control the assignation documents will be released by the Bank and the Ticketus agreements will become unconditional.”

This is, remember, on 19th April 2011, when, according to D&P in the April report, its only involvement was brokering the Bank deal. Of note, and I may come back to this in another post later, the plan at that stage was to remove all the existing directors as soon as possible and replace them with Messrs Whyte, Betts and Ellis. Whatever happened between then and early May meant that Mr Ellis’ elevation only took place nine months later.

Para 6 refers to “Ticketus agreements” plural. If this was only for an un-quantified short term funding facility, as Mr Grier suggests, then why is this mentioned in the paragraph referring to the settlement of the bank debt? It might well be bad drafting, and one assumes that, having received this email, or having been party to the earlier discussion referred to by Mr Withey, Mr Grier would have sought clarification from Mr Whyte, or Mr Betts, or Mr Withey, or Mr Ellis or Ticketus or somebody of the apparent confusion. After all, a short term working capital facility is not what is used for settlement of a major bank debt key to the acquisition, is it?

Might Mr Grier have wondered about the reference to the Ticketus “agreements”? what agreements? Why more than one? What were these about? However, it is clear from what Mr Grier says that he received no answers at all to these matters, yet he continued to act.

Mr Grier’s denial refers to the draft Ticketus email, but not this one. Maybe he never received this one, and that is why he has not commented upon it. It does suggest that the Ticketus “agreements” were connected to the clearing of the bank debt, although, as the acquisition funding was only one pound, he is correct to say it establishes no link to that.

“We, along with solicitors acting for the Murray Group and Lloyds Bank, were provided with information from Collyer Bristow to confirm that Liberty Capital had funds at their disposal to both acquire the debt of Lloyds Bank and provide sufficient working capital to satisfy the concerns raised by the independent committee of the Club. The financial forecasts that we had sight of showed the original cash injection to acquire the Club was from Wavetower and not Ticketus.

Prior to the takeover, the April Report by D&P mentions only the following as work instructed over and above negotiating with the Bank:-

“In April 2011, MCR BC was requested to attend a meeting between Mr Craig Whyte and the Independent Directors’ Committee that had been established by the Company to assess parties interested in acquiring the majority of its share capital. Responses were provided by Mr Craig Whyte to the Independent Directors’ Committee to questions regarding Liberty Capital’s net assets, ability to fund the proposed acquisition and make additional funds available to the Company for various post-acquisition purposes and its intended general post-acquisition strategy.”


Presumably as part of this D&P had information from Mr Whyte. Was it only the letter from Collyer Bristow? Was there nothing else? After all, as D&P accept that there were discussions about Ticketus, and they were engaged to address the working capital issues, they would have obtained something from Ticketus to vouch their position? Anyone can walk into a meeting and claim to have funds…actually proving that funds exist is a different matter. Maybe Mr Grier was happy with whatever Mr Whyte told him about Ticketus, and had not need to see anything from them to fulfil his professional duties.

Once again he refers to the cash injection “to acquire the club”. If we extend him the benefit of this including the Bank repayment, he notes it was coming from Wavetower. One issue there though is that Wavetower was an acquisition vehicle. It had no money of its own, except that invested in it or lent to it. The issued capital provided the acquisition funds of £1, but not the Bank repayment. Therefore where was Wavetower getting its money? As D&P were acting at this time for Liberty Capital, why say that the funds were coming from Wavetower?

“It is clear now, with the benefit of hindsight, that material information was withheld from us, and others, prior to the acquisition of the Club and, once we discovered the full extent of the funding relationship between Ticketus, Liberty Capital and the Club, we took immediate steps to raise our concern with controlling directors of Rangers and HMRC.

Mr Grier again mentions his concerns being brought to the attention of the controlling directors and HMRC. Why the latter? What did his concerns have to do with HMRC?

It is of note that he refers to discovering the FULL extent of the funding relationship. Did D&P know part of the funding relationship therefore, or the nature but not the full extent?

Mr Grier also has to face the issues which gave rise to the suggestions of a conflict of interest, especially arising from the April 24 meeting. This was the meeting between Mr Whyte and the IBC, to address, as Mr Grier writes, “questions regarding Liberty Capital’s net assets, ability to fund the proposed acquisition and make additional funds available to the Company for various post-acquisition purposes and its intended general post-acquisition strategy.”

This was a big meeting. The approval of the IBC was not essential, but would have been helpful. Mr Grier attended the meeting with Mr Whyte. One assumes that he would have prepared for the meeting by going though the questions anticipated and evidencing answers to them. When matters about working capital were raised, if we believe Mr Grier, and I am not suggesting we should not, he would have said that it was all in place for Wavetower, but could only have made a vague mention of Ticketus, if any at all?

The conflict issue arises specifically in connection with the court action being pursued by D&P against Mr Whyte and Collyer Bristow. If Mr Grier attended as an adviser to Mr Whyte, as he did, one possible issue in the action could be that, according to Mr Whyte, Mr Grier would have been fully aware of the situation regarding funding. (As far as I know Mr Whyte has not confirmed his position on that, but clearly that argument could be made). In that event, whilst it would not be a defence to the action, which is based on Rangers Football Club PLC allegedly being deceived, it could lead to a dispute in court about the state of Mr Grier’s knowledge. Issues of client confidentiality abound. The matter seems fraught with conflict.

A long time ago I was at a legal seminar. The very wise speaker suggested the following.

If you find yourself asking if you have a conflict of interest, then treat yourself as having a conflict of interest!

The fact that the question occurs suggest that one might exist. Even if you decide that there is not one, someone else might allege there is, and thus you can end up spending a lot of time and money proving you are right. It is far better to accept the possibility, and decline to act. It is simpler and saves huge risks. However, turning away work is something professionals are reluctant to do, especially where the case is a high-profile one.

Over and above the meeting with the IBC there are wider “conflict” issues. “Conflict of interest” is a misunderstood concept, being narrower than public perception has it. However, there are some apparently clear situations.

As can be seen from their own admissions, D&P acted for Liberty Capital Ltd. D&P acted for Rangers Football Club PLC. Effectively D&P acted for Rangers FC Group Ltd. Effectively D&P acted for Craig Whyte. Becoming administrators where Group/Liberty Capital was secured creditor and majority shareholder was not, per se, a conflict. Once there began to be discussion about declaring the transaction purchasing the club invalid, or invalidating the transfer of the security, or suing Mr Whyte for misrepresentation, I do not understand how anyone can see those as not raising huge conflict questions.

I have no doubt that Mr Grier and D&P had the very best advice re conflict issues. However, I am suggesting that discretion is the better part of valour.

“Throughout this process we have acted professionally and provided opinion and recommendations to avoid an insolvency of the Club by outlining alternative courses of action to the directors. We did provide the controlling directors and company secretary of the Club with our written concern that failure to meet their statutory duties could lead to a claim of wrongful trading, however the controlling directors and company secretary always maintained that insolvency could be avoided through the introduction of new capital and/or fundraising with supporters of the Club.”


Mr Grier ends his part of the statement as stated above. Let’s look at what else D&P accept having been instructed to do, shall we?

From the Proposals to Creditors:-

“5.6 Around this time, it is understood that Ticketus advanced £20.3m to a Collyer Bristow client account in the name of RFC Group in consideration of future season ticket revenue from the Club of approximately £25.4m. The advance was to be repaid from the proceeds of season ticket revenue for the 2011/12, 2012/13 and 2013/14 seasons.


5.7 Following the purchase in May 2011, MCR BC was engaged by Liberty Capital to provide advice to the Company’s management team. This involved assisting in the preparation of a short-term cash flow forecast review, reviewing the Company’s organisational staff structure and liaising with HMRC on behalf of the Company in respect of the Small Tax Case.


5.8 MCR BC provided HMRC with a formal update on 13 June 2011, which included an overview of the Company’s projected working capital shortfall in the following 3 months (as identified by the short term cash flow forecast review), an overview of the Company’s financial position and an assessment that the Company would be unable to continue to trade in the medium term without the introduction of third party funds or shareholder support. Given this position, an offer of an immediate payment on account of £200,000 was proposed to HMRC and a request made for further time to assess possible new sources of income for the Company to allow time to formulate a proposal to HMRC relating to the balance of the Company’s Small Tax Case liability.


5.9 In June 2011, the first £3m of the liabilities due to Ticketus were paid by the Club, followed by an additional payment of £5m in September 2011.


5.10 In August 2011, Liberty Capital engaged MCR BC to conduct a review of the Company’s longer-term financial forecasts and assess the options available to the Company. This included capital raising and various restructuring options. In the meantime, MCR BC monitored the cash flow of the Company and assisted with further discussions between representatives of Liberty Capital, the Company and HMRC, following submission of the initial proposal to HMRC.”

As regards para 5.6, I like the reference to it being “understood” that Ticketus advanced £20.3 million. Clearly it is D&P’s position, and we are not doubting Mr Grier, that he knew nothing of the deal till his concerns “crystallised over the summer of 2011”.

Following the purchase D&P were engaged by Liberty Capital “assisting in the preparation of a short-term cash flow forecast review, reviewing the Company’s organisational staff structure and liaising with HMRC on behalf of the Company in respect of the Small Tax Case”.

D&P then “provided HMRC with a formal update on 13 June 2011, which included an overview of the Company’s projected working capital shortfall in the following 3 months (as identified by the short term cash flow forecast review), an overview of the Company’s financial position and an assessment that the Company would be unable to continue to trade in the medium term without the introduction of third party funds or shareholder support.”

Did the cash flow projections include reference to Ticketus, either in terms of short-term funding, or the £20.3 million “understood” to have been paid? Mr Grier’s position amounts, as I read it, to a statement that D&P had no knowledge of any Ticketus funding, or of they did, that this was deliberately mis-stated by or on behalf of Mr Whyte. That would suggest therefore that the update provided to HMRC was incorrect, and deliberately so on the part of “Rangers”.

There are many potential legal implications which would arise from an attempt by Mr Whyte, or anyone else, to mislead deliberately HMRC. Responsible accountants, as D&P are, would not be party to such a scheme.

Mr Grier fails to answer the issues raised by the BBC in relation to the 24 May 2011 email, from Ross Bryan of Octopus Investments, the parent company of Ticketus.

This email, sent to Mr Grier and Phil Betts, reads in part as follows:-

“Just a quick note to ask when we will be able to procure the invoices from the club for the deal… I know we were waiting on the formal removal of Ali J and others to clear the decks, so has this taken place (target was last week)?

“So you are aware, and this has no consequence on the club, we have assigned this first season’s tickets that were bought by Ticketus LLP over to Ticketus 2 LLP under clause 13.3.1 of the TPA (Ticket Purchase Agreement) … the only thing to watch for is that when you produce the invoice for the tickets, this season’s will need to be made out to Ticketus 2 LLP rather than Ticketus LLP if you read verbatim from the contracts…”

Therefore Mr Grier was sent an email (and we have no idea if he received it) on 24th May. It referred to invoices being “procured”. It mentions “this first season’s tickets” which implies more seasons are included. It refers to a Ticket Purchase Agreement. It asks that the invoice for this season’s tickets to be made out to Ticketus 2 LLP.

Mr Grier must not have received that email. If he had, then he must not have read it. After all, if he had seen this in May, then surely he would not have had to wait “over the summer” for his concerns to crystallise? He would, one assumes, have asked to see this TPA. He would have asked why there were more seasons that one included in the short term funding of working capital.

It is also of note that a customer of the company, for Ticketus was a customer, was involved in discussions about removal of directors. What bearing did that process have on their dealings with Rangers?

Looking again at Ticketus, and Mr Grier’s concerns “crystallising over the summer” we now have an email exchange covered by the BBC. Phil Betts emailed Mr Greer on 23rd June 2011 at 9.08pm and Mr Grier replied at five past midnight in the early hours of 24th June, three hours later.

Phil Bets asked Mr Grier:-

“I met with Ross Bryan today to discuss invoicing. Unfortunately, we need to raise the invoice and date it 9th May. So can you please raise it and email it to me please”.

Mr Grier replied:-

“Have been at the club today and meeting with various people, but will arrange to get the invoice to you asap…”

At this point, we take a brief detour to the SFA Judicial Panel verdict, which can be read in full here 93212354-SFA-Rangers-Note-of-Reasons. What we are looking at is the following:-

74. That in the course of the latter part of August 2011 Mr Ken Olverman was contacted by two senior officials of the Customs and Excise (VAT) division of HMRC. Their enquiry was in relation to invoices which had been discovered in the business records of Ticketus which bore to have been raised by Rangers FC. The invoices related to sums of many millions of pounds and the VAT element in each of them had been the subject of offset by Ticketus in the submission of its VAT returns for the last period. Such was the size and impact of this offset of VAT which had been paid by Ticketus in respect of these invoices, that Ticketus had made a claim for payment of a substantial sum to it by HMRC by way of recovery of VAT paid.

75. That Mr Ken Olverman, the Financial Controller of Rangers FC had no knowledge of the existence of the invoices purportedly raised by Rangers FC. The raising of such invoices was a matter which fell squarely within his sphere of responsibility and it was inconceivable that such invoices for such large sums could be raised and issued from the finance office of Rangers FC without his knowledge. He had no knowledge of any agreement with Ticketus which might give rise to any invoice within the period concerned. He was unaware of any current transaction with Ticketus and knew that no sums of money had been received in recent times from Ticketus into any accounts of Rangers FC.

76. That in the course of September 2011 Mr Ken Olverman had sight of the said invoices. The nature and format of the invoices was entirely different to that of invoices raised within the finance office of Rangers FC. He was of the view that it appeared as though “Clip Art” computer processes had been involved in their creation. They did not appear to him to resemble any invoices he had ever seen issued by Rangers FC. Having sight of the invoices confirmed his view even further that they had not been created within the finance office of Rangers FC.

77. That Mr Ken Olverman believed from his conversations with the HMRC official that the invoices were the subject of further investigation. He accordingly took no further action in relation to the invoices. He did not make enquiry of Mr Craig Whyte nor of Mr Gary Withey. He did not inform any of the current directors of Rangers FC of the matter.” (Emphases added).

So we have Mr Grier promising to email an invoice dated 9th May to Mr Betts on 24th June 2011 in connection with Ticketus. We then have Rangers Financial Controller stating that he has no knowledge of invoices from Rangers to Ticketus, and suggesting they were prepared using Clip Art.

Could it be that these are the same invoices? Did Mr Grier, at the request of Mr Betts, prepare an invoice or invoices in June dated 9th May 2011 addressed to Ticketus? Might the clip-art reference relate to the addition of the Rangers crest to the invoice?

It may well be that this invoice referred to by Mr Grier is nothing to do with Ticketus, or it is only in relation to one short term tranche of funding. However, it raises substantial questions.

Remember too that at that stage, according to the D&P proposal, the work they were doing for Liberty Capital was “assisting in the preparation of a short-term cash flow forecast review, reviewing the Companys organisational staff structure and liaising with HMRC on behalf of the Company in respect of the Small Tax Case.”

What does the preparation of back-dated invoices from Rangers to Ticketus have to do with the issues mentioned in D&P’s own statement?

In addition “in June 2011, the first £3m of the liabilities due to Ticketus were paid by the Club, followed by an additional payment of £5m in September 2011.”

So at the time D&P were assisting Rangers with short-term cash flow projections, £3 million was paid to Ticketus. Did Mr Grier make enquiries as to what this related to? Could he or his colleagues prepare forecasts and projections without knowing the nature of the payment to Ticketus, and further liabilities to them?

“In August 2011, Liberty Capital engaged MCR BC to conduct a review of the Company’s longer-term financial forecasts and assess the options available to the Company. This included capital raising and various restructuring options. In the meantime, MCR BC monitored the cash flow of the Company and assisted with further discussions between representatives of Liberty Capital, the Company and HMRC, following submission of the initial proposal to HMRC.”

By this stage, when D&P was monitoring cash flow and discussing capital raising, had Mr Grier’s concerns crystallised? August might be seen as being “over the summer”.


As I said above, I suspect that Duff and Phelps wish out of this mess now. However, there are major problems in extricating themselves from the imbroglio.

Mr Grier’s statement and robust defence raises, in my submission, many more questions than it answers.

The conflicts apparent make it, in my submission, unwise at best for D&P to continue to act as administrators. By now they should perhaps step away from the role to concentrate on defending their reputation.

Posted by Paul McConville



Filed under Administration, Rangers

29 responses to “Some Questions For David Grier and the Administrators of Rangers

  1. Excellent work! Since the departure of Sir Tainted Murray this shipwreck has attracted more sharks and piranhas than any other cadaver in history. What amazes me even more is how HMRC and UEFA can stand on the sidelines watching this charade unfold to the detriment of Scottish football around the world. What more has to happen before they get involved?

  2. Daniel Toye

    One would think there is some kind of shortage of administrators in this country? Would it really have been so difficult to find someone who didn’t have anything to do with Rangers to take on this role?

    We should not be in a position where the administrators are having to PROVE their innocence. I’m NOT saying there is no smoke without fire (there sometimes is) but when the smoke is so thick you can’t see your hand in front of your face, it’s time to make for the exits.

    Duff and Phelps have had the benefit of the doubt up till now. I don’t mind giving them some more if they do the professional thing and asked to be excused from their responsibilities now.

  3. SouthernExile


    Excellent as always.

    D&P in New York must be looking very closely at the warranties and indemnities provisions in the SPA with the MCR partners. The MCR ex-partners ditto. How much does this explain behaviour since valentine’s day?

    HMRC seem to have lost sight of the 5m vat paid over by Ticketus in response to the clip art invoices which might have been raised by Mr Grier. Any idea where it might be?

  4. John Pollock

    I’m beginning to think HMRC are in on this masonic conspiracy. Why hasn’t the BTC been announced when the evidence is being played out in the media? And why does Green think he has struck a deal with Hector? This stinks!

  5. Richboy

    Paul, possibly your best analysis to date, although it would really take something to best your analyses of the recent judiciary tribunal and subsequent appeal. I would love to hear your thoughts on how UEFA will act regarding rule 64 (UEFA rules) if the SFA/SPL fail to sanction Rangers in regard to their appeal against the transfer embargo in the Court of Sessions.

    I have read elsewhere that the body investigating D&P is, to all practical intents and purposes, toothless. I am aware that they could remove D&Ps licence to operate but are unable to remove them from this case. As with most professional overseers it is extremely unlikely that they will take such severe action agianst a member company.

    Having spent my entire adult life in the gaming industry, it seems to me that D&P are now involved in a high stakes poker game. Their strategy, or bluff if you prefer, is to distract and deflect. When another player suggests their hand is weak they go on the offensive and try to bully that player out of the game. Hopefully when they go “all in” there will be at least one player standing to sort them out.

    My major concern in all of this is that Mr Green will eventually end up in control of Rangers FC prior to end results being achieved in relation to double contracts, ebt tax evasion, appeals against transfer embargo etc. I then fully expect those in charge (including club directors) at SFA/SPL and HMRC to give in and accept they cannot do anything about it.

    My main hope in all of this is that UEFA wil act as they did with Sion FC in Switzerland. In this case UEFA were criticised for not acting quickly, but they did act in the end. UEFA allowed the Swiss FA to deal with the matter prior to issuing them with an ultimatum in January 2011. The Swiss FA acted immediately on receipt of said ultimatum. I sincerely hope the SFA/SPL would have the courage to stand against Rangers to avoid their expulsion from European and World Cup tournaments. I will not however be holding my breath.

    • Greg72

      Richboy – just to add a little to your second paragraph: insolvency practitioners are individually licensed, and not their firms. Were any practitioner’s licence to be withdrawn (and I’m talking purely generally now), then he would cease to be able to hold any insolvency appointments. This is because one may not act as an insolvency practitioner unless one is licensed.

      Does anyone yet know the outcome of the creditors’ meeting by correspondence on 23 April?

  6. Tyke Bhoy

    Congratulations on the brevity Paul 😉 Must be a legal practitioners thing!!

  7. Paul,

    A small clarification:

    “Phil Betts emailed Mr Greer on 23rd June 2011 at 9.08pm and Mr Grier replied at five past midnight in the early hours of 25th June, three hours later.”

    The second date should be 24th June, otherwise it is 1 day 3 hours later.

  8. TonyD

    The biggest insolvency event in British footballing history and not one redundancy! It is clear to the ordinary citizen that D&P are acting in the best interests of RFC.

  9. TonyD

    Sorry, should have congratulated you on a great piece of work, first class analysis.

  10. Hoopy Hound

    I have to say, well done to all the investigative work done on this matter. But is it just me or has it all reached saturation point? Personally I’m fed up hearing about Rangers and their many problems, I even have Rangers supporting friends who now wish to be put out of they’re misery, one way or the other. Its like death by a thousand cuts. I do hope it gets resolved quickly or we’ll be starting season 2012/2013 in December. I don’t think I can wait that long to see the League flag being unfurled at Paradise.

  11. Den

    Superb analysis.

    I think that without implying any guilt that any professional worth his salt would have advised D&P not to accept the Administrators position; given that they had been advising the Company since the change of management.

    Three things stand out for me.

    1. Why would Ticketus request a Rangers invoice from Grier, and why would he undertake to provide it. He wasn’t an officer of nor an employee of the Company. according to him he didn’t know the details of the Ticketus deal. Ticketus May have mistaken a prominent adviser to the club as an executive but Phil Betts must have known better but still asked Grier to arrange the invoice. Why was it necessary to have it backdated to 9 May?

    2. Why didn’t the Financial Controller at Rangers follow up on the ‘clip art’ invoice. It would be in the interests of Rangers to ensure that people were not using their name and reputation to perpetrate a fraud. Most accountants that I know woud have followed up, maybe he was used to unusual transactions appearing from nowhere.

    3. Mr Bryans request for an invoice was interesting. How would he have been party to the Board machinations at Rangers, and been relaxed enough to mention it in business correspondence. The mail was clearly not to be passed on to the Rangers Accounts Department to raise and invoice.

    I am not suggesting that these were the same invoices, I don’t know, but if they are it is one very suspicious transaction, if not it is two very suspicious transactions.

    Maybe it is not just D&P where there was an apparent conflict of interest.

    • If I was the financial controller and was warned to stay out of the clip art invoices by HMRC then I would have stepped back too.

      What it does raise is questions as to the dates on these invoices – from my limited understanding (and I am neither legal nor accounting, so I expect to be corrected on this) it seems these were backdated and that was helpful to ticketus in terms of claiming VAT back – were the invoices simply late? Or was there another reason for the supplier to ask for specific dates to be inserted on this invoice? I don’t know if this is normal elsewhere but I’m not sure my accounts department would be messing about with invoices of this magintude, especially in light of all the other financial issues rangers are going through… Maybe I’m barking up the wrong tree, but given HMRCwere taking an early interest, it is curious.

      Would welcome insight from others.

      • Den

        If warned by the HMRC to stay out of it then he would be right to stay out of it, however the report says he “believed” it was the subject of further investigation and took no action.

        I would have expected him to get a contact and ask for updates on the investigation to ensure that there was no implication of wrongdoing at Rangers. I would also have expected that he would raise the issue with Whyte to let him know that the company name was being used in unofficial invoices.

        I think there are very few accounts departments that would backdate an invoice.

        Speeding up VAT recovery would be one reason, but it is fraudulent. i suspect also that it was to fit into a timeline.

        The “removal of Ali J and others” to clear the decks is interesting. Maybe an agreement was held up pending the removal and someone did something without authorsation and a properly dated invoice would have exposed this. It may not be have been for personal gain, someone simply cut a corner to facilitate the deal and now needed to cover their tracks. Still fraudulent.

        I suspect that the Financial Controller didn’t take it further because he had seen enough of what was going on to suspect that Whyte, Betts and Grier were involved in it. As controller his remit seemed to be severely limited by Whyte and he became used to being left out of things. I have sympathy for the position he found himself in as there is no suggestion that he was in any way involved just in the wromg place at the wrong time.

  12. Sean Daniel

    Excellent work Paul.
    Q. Can the judge who awarded D&P the administration assigment be sued for imcompetence. I recall at the time finding it absurd that a judge would accept Whyte’s recommendations of D&P over the courts recommendation of a neutral.

  13. Thanks Den, and I agree in the main and I am especially interested that there might be questions asked re any potential fraud (tho give rangers finbance department was in such disarray, I’m not ruling out ‘cock-up’ as a theory.

    Point 77 was that he believed there to be an ongoing investigation, but given it was two officials that drew olverman’s attentiom to these invoices in july (by which time you might have thought an invoice of that size might have passed across his desk) as the result of their enquiries, as stated in point 74, I think its a fairly reasonable assumption of mr olverman’s part.

    I am however not as generous a spirit as you Den, regarding mr olverman being in the wrong place/wrong time. Rangers seem to have been usoing every trick in the book to run the club at a huge loss for years – EBTs, wee, big tax cases, witholding of PAYE and NI, even when thjey have hjad HUGE cash injections, from ENIC and King, they didn’t bother getting the club on a stable footing. Wrong place/wrong time? All of it?

    Don’t know about you but I have resigned on points of principle a couple of times, I know what I would have done…

    • Den

      Rangers Finance Dept were probably in disarray and there could have been any number of ‘cock ups’ which we may see in due course. This was far from a ‘cock up’ it was a very conscious act.

      As for my geenerous spirit. It allows the Financial controller the benefit of the doubt in this case. It does not extend to the years of manipulating the accounts to obscure the true picture, EBTs and other tax avoidance etc. So in answer to your last questions in the second paragragh. I never said or implied that all of it was wrong time/ wrong place, it wasn’t,

  14. Bhody

    Several million of vat has been reclaimed by ticketus with
    No corresponding vat sum paid by Rangers.Therefore do we have
    a major criminal vat fraud (allegedly)? Where is the major criminal investigation?

  15. Sorry should have put a wee smiley or hector there, I wasn’t suggesting you would let them off the hook or anything, just that you are more generous of spirit regarding benefit of the doubt than I am. I’m the kind of guy who thinks if it looks like a skunk, and smells like a skunk, I’m unlikely to ask if it’s a black cat with highlights and aversion to batheing.


  16. Bhody

    How can a cva be submitted to creditors when the big tax case has not been resolved and this could be the largest creditor,and the missing vat has still to be investigated?

  17. Jim

    “Maybe an agreement was held up pending the removal and someone did something without authorsation and a properly dated invoice would have exposed this.”

    Which makes it all the more fascinating that pretty much the first act of D&P on the first day of their administration was to hire a shredding van. Do administrators ever shred stuff in the normal course of events? That quickly?

    • Den

      i wasn’t aware of the shredding van. Administrators mostly try to preserve documentation and shredding is not the first priority in any investigation.

      I have been intrigued by D&P novel approach to their job since they were appointed.

  18. Pingback: The BBC and Duff & Phelps – Emails Re Fees Quotation and Questions for David Grier | Random Thoughts Re Scots Law by Paul McConville

  19. Pingback: Mark Daly Reveals Rangers’ “Smoking Gun” – Craig Whyte Taped David Grier of Duff & Phelps | Random Thoughts Re Scots Law by Paul McConville

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