Improper registration issue closes in on Murray

Sir David Murray and former Rangers director, Mike McGill, who is also a director of Murray International Holdings, gave a press briefing yesterday.  Much of what Murray said relates to his disappointment at the actions of Craig Whyte, whom he sold Rangers to last year.  Throughout the years Rangers were for sale Murray maintained he would only sell to someone with Rangers best interests at heart.  Whyte has, by many accounts, fallen short on this measure, however, it is far from clear that Sir David had much choice in the matter.

The club were dependant on the support of Lloyds Banking Group and had a potential liability of around £49m to HM Revenue and Customs hanging over them.  Whyte offered Lloyds the opportunity to relieve themselves of crica £18m of debt, potentially rising to nearly £70m, which would have subsequent consequences for Rangers budget and earning potential.  When you are £70m in debt with contracted structural costs which cannot be changed quickly, while income can vary on the bounce of a ball, £80m is within touching distance.  In truth, it could be argued that even Lloyds, 43% owned by the taxpayer, had little choice but to force through the sale.

Murray will take responsibility for putting the business into the position if was when Craig Whyte’s £1 offer won the day.  He and his board elected to utilise the Employee Benefit Trust (EBT) that has caused so much turmoil.  He and his board elected to press ahead with multi-million pound player purchases after HMRC first raised the alarm about EBTs in 2010, instead making immediate cutbacks to provide for a potential loss of the First Tier Tribunal.

What Murray said about the on-going tax case or Craig Whyte is irrelevant.  Let’s instead take a look at what was said about player payments.

Murray said:

“There was no double contract. There was categorically no dual contracts.”

“What I would say is this. We went through 10 AGMs. We signed off accounts by Grant Thornton, the remuneration trust was always mentioned in the account. It was never hidden, and that’s a fact.”

Accept there was no double contract, thank you.

Accept the remuneration trusts were mentioned in the accounts and not hidden, this is, indeed “a fact”.

Mike McGill, said:

“The other, larger [EBT] scheme, started in 2001, involves a payment into an offshore trust, but there is no contractual entitlement on the part of the players.

“The whole basis of an EBT arrangement is that there is not a contractual entitlement. That is key to the defence, and key to the allegations made by the SFA [sic].”

Accept there was no contractual entitlement on the part of the players.

The EBTs not being subject to contractual entitlement is “key to the defence, and key to the allegations made by the SFA”.

Ah.  We’re getting somewhere.

Scottish Premier League, Rule D 9.3:

“No Player may receive any payment of any description from or on behalf of a Club in respect of that Player’s participation in Association Football or in an activity connected with Association Football, other than in reimbursement of expenses actually incurred or to be actually incurred in playing or training for that Club, unless such payment is made in accordance with a Contract of Service between that Club and the Player concerned.”

Scottish Football Association, Articles of Association, Article 12.1:

“Furthermore, all payments, whether made by the club or otherwise, which are to be made to a player solely relating to his playing activities must be fully recorded within the relevant written agreement with the player prior to submission to this Association and/or the recognised football body of which his club is in membership.”

The SFA’s Registrations Procedures go on to state:

Rule 2.2.1

Unless lodged in accordance with Procedures Rule 2.13 a Non-Recreational [professional]Contract Player Registration Form will not be valid unless it is accompanied by the contract entered into between the club concerned and the player stating all the terms and conditions in conformity with the Procedures Rule 4.

Rule 4

Such agreement shall be signed by the player and by the secretary or an accredited official of the club concerned and shall be witnessed by 2 other parties and lodged with the Secretary [of the SFA]together with the Form.

If Mr McGill is correct that players not having a contractual entitlement to EBT payments is key to the defence in the SPL inquiry (or SFA as Mr McGill suggests), it would appear that corresponding player registrations are not valid.

No Player may receive any payment of any description unless such payment is made in accordance with a Contract of Service.

All payments, whether made by the club or otherwise, made to a player relating to his playing activities must be fully recorded within the relevant written agreement with the player prior to submission to the SFA.

No matter how often the SFA president and former Rangers directors brief journalists on issues which sound a bit like the Improper Registration of Players allegation, but are, in fact, the on-going tax case, this matter is not going away. The Association are now actively involved in this matter, as Alex Thomson of Channel 4 News and Chick Young of the BBC testified to yesterday, but not in the way you would expect.

In football parlance, they are competent to investigate this matter and to provide subsequent appeals process if required, and have a duty to do so at the earliest opportunity. SPL football will resume on Saturday and we require clarity on who is, or is not, correctly registered to play.