Have Rangers Paid Hearts for Lee Wallace? Charles Green and Chick Young Seem to Disagree

Last Saturday Charles Green spoke to Rangers fans at Ibrox for their match against Alloa. I wrote about what he was recorded as saying here. It would appear that not all that Mr Green was noted as saying was 100% accurate. I am sure the apparent discrepancies noted below were entirely as a result of oversight or error, and not a deliberate clouding of the issues or declarations of bravado to appeal to his audience.

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There are two specific paragraphs I want to mention initially, which are reproduced exactly as they were written by the original poster on a Rangers message board.

3 – All footballing debt have been paid apart from the 31k to Dundee Utd which he has a letter confirming would be paid by the SPL.

6 – Rangers owed hearts the remainder of the Lee Wallace fee, Hearts were so desperate for the money eventually offering a 100k discount if we paid the cash two weeks ago. Thats why the couldn’t pay the wages.

My interpretation of that was as follows:-

• Hearts have been paid for Lee Wallace.
• Mr Green negotiated a discount for prompt payment.

Hearts – “A Call To Arms” – Pay Up or the Club Dies!

Yesterday I wrote about the new HMRC petition to wind up Hearts over a tax debt in excess of £400,000.

The announcement of this, which the Hearts Board had to do if they wish to proceed with their share issue, was followed by an apocalyptically titled letter to the fans – The future of Heart of Midlothian.

It reads as follows, with my comments in bold:-

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Today the Board of Heart of Midlothian plc is writing to you with the express wish that every supporter provides emergency backing for the club.

This is not so much a request as a necessity.

To use the words yesterday of John Robertson, one of the greatest players in this club’s history, this is a “Call to Arms”.

There is no greater need than now for supporters to invest in the club in whichever way you can, without delay. How can you do this?

HMRC v Hearts – A New Winding Up Petition – Might Sink Share Issue…and the Club

Recently I wrote about the Hearts share issue, the fact that the support seemed to be fully behind the efforts to raise funds to keep the club going to the end of the season, and the numerous risk warnings which basically amounted to the Hearts Board saying that there was literally no chance at all of any return whatever in return for buying the shares.

The share issue was a cri de couer by the Board. Having pointed out that the business was effectively insolvent, the Board said that is the share issue failed, then they would have to source the money from elsewhere. Who would lend to an admittedly insolvent business?

Today saw two announcements from Hearts, both of which emphasise the parlous position the club finds itself in. I will deal with the second in a later post.

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The Board Statement – Winding Up Petition

Heart of Midlothian plc (the “Club”) today wishes to make supporters and potential share offer investors aware of this most recent financial matter for their consideration in conjunction with the Share Offer 2012 brochure.

The Club has been served with an Order to wind up Heart of Midlothian plc by the Court of Session on behalf of the Commissioners for Her Majesty’s Revenue and Customs (the “Petition”).

The Hearts Share Issue – Risk Factors Galore – One For the Die-Hards Only?

Who would have thought that Hearts would beat Rangers to offering shares in the club to its fans? At this stage let’s ignore the club/company issue. What I want to focus on is the section issued by Hearts detailing “Risk Factors”. It can be found here.

No one can accuse Hearts of “soft soaping” the fans. The Risk Factors are spelt out most starkly. It will be interesting to see the contract with the Rangers Prospectus when it is issued.

Clearly the two organisations are very different, in terms of debt, fan base, finances and reliance on third parties.

Many of the Risks associated with Hearts will not apply to Rangers and vice-versa. However it does give a template for things to be looked at.

General Warning

The statement makes clear that acquisition of shares “involves a significant degree of risk”. It states that “specifically in the context of an equity investment in a Scottish football club in the current economic climate and last reported net debt of £24 million you should not expect any income from or return on your investment”.

It continues:-

“You should not acquire shares in the company unless you are capable of evaluating the risks and merits of such investment and have sufficient resources to bear the loss of all the money invested by you.”

It then states:-

“The Directors are committed to strategies that are intended to deliver long term value but there is no guarantee that those strategies will succeed.”

It is quite clear therefore that there ought to be no expectation whatsoever of any financial return from investment in Hearts shares, nor even a speculative one. Therefore it would seem to be the case that this one is not targeted at institutional investors, unlike that of Rangers. This one is for the Hearts die-hards only, it seems.

Responsibilities of the Scottish Football Association – And Other Myths – Questions For Mr Regan

I wrote recently about Stewart Regan’s remarkable admission that the “fit and proper” person test as regards football officials was a “myth”. This was because checking the bona fides of new directors and officials would take a “cast of thousands”. Therefore the SFA relied upon the member clubs and the officials themselves to confirm whether or not they were “fit and proper”. This is taking self-regulation to the extreme.

It reminds me of the questions asked on immigration cards when visiting the USA which, from memory, include asking of you are coming to the USA to overthrow the government or engage in terrorist activities. I do not think many people say yes!

The latest news from the SFA, although not accompanied, as of last night, by a statement from Mr Regan on the SFA website, is that the SFA has written to member clubs asking them to state if they have made payments outwith contracts to players in the last 10 years.

This has provoked a range of responses. Some view this as proof that the whole of football in Scotland was rife with what Rangers have been accused of, and this is the SFA catching everyone in the net. Others have seen this as a prime example of “whataboutery” ie an effort to catch others in the same net as, allegedly, Rangers, even if the scale is very different.

It is viewed by some as the SFA doing its job, and by others as a further abdication of responsibility.

After all, if the policing of the “fit and proper” rue would require a “cast of thousands” then how many, on Mr Regan’s argument, would be needed to oversee and review the financial information which football clubs are required to submit to the football authorities? Do the SFA, SPL and SFL employ a phalanx of accountants and lawyers to pore over the accounts lodged by member clubs? Or do they receive them in the post, and drop them into a secure filing cabinet, never again to see the light of day?

Mr Regan commented that the SFA had to rely on a PLC like Rangers fulfilling its legal obligations, which are wider than simply football-related rules. However only a handful of SFA members are PLC’s. Most are private limited companies, whose rules are much less strict than those for PLC’s.

Mr Regan’s “myth” comment therefore appeared to confirm that SFA, and by extension SPL and SFL regulation is “more honoured in the breach than the observance”.

What it does show is, in my view, proof that the SFA’s “governance” of Scottish football has been a “myth” and for many years has worked on the basis that, to quote the great philosopher, Terry from Fawlty Towers, “What the eye doesn’t see, the chef gets away with”.