More key information from FTT report for Nimmo Smith Commission


The enormity of the forthcoming SPL Commission report could easily be lost in the ocean of headlines which has engulfed this matter in recent years.  I’ve noted below more information from the recent First Tier Tribunal report on Rangers tax case, in an attempt to clarify some of the key issues.

From The Evidence:

“The Appellants’ first witness was Mr Red, a senior member of the group’s tax function.  He is a Chartered Tax Advisor and qualified as a tax inspector previously to joining the Appellants.”

“Mr Red insisted in his evidence that the Trust was not a means of “tax avoidance””.

“It was noted in an internal memo prepared by Mr Red dated 8 September 2005 to the Board of MIH that he had described the Trust as a form of “tax avoidance scheme””.

Dissenting opinion from Ms Poon:

The Nature of the Side-letters
“Another strand of evidence being tested was the nature and purpose of the side-letters.  Asked about the secrecy surrounding the side-letters, referring to the fact that they were not lodged with the SFA, nor disclosed in the long period of HMRC’s enquiry, Mr Red’s reply was: ‘I still say there is nothing secret about them. We have nothing to hide in these side letters’.

“It is not accepted that there had been no deliberate concealment of the side-letters, in view of how the first side-letter only came to light through the seizure of Mr Berwick’s file nearly four years into the enquiry.

“It is not accepted that the nondisclosure of the side-letters arose from a ‘credible’ view that Mr Red considered the side-letters irrelevant to HMRC’s enquiry. As a former Inspector of Taxes, Mr Red knew, or should have known, that the side-letters were highly relevant to the enquiry.”

“The side-letters showed a form of contractual arrangement, and they proved linkage between the sums contributed into the sub-trusts at the appointed dates and their withdrawal as loans from the sub-trusts as contemporaneous transactions. The contractual aspect and the linkage between the amounts of contributions to the main Trust and the sums loaned had been repeatedly raised in the enquiry correspondence.

“A fair conclusion to be drawn from the circumstantial evidence on the one hand, and Mr Red’s oral evidence on the other, is that the side-letters had been actively concealed. The reason for the concealment might have been, in Mr Red’s view, the side-letters could be incriminating evidence against the impression of the trust operation that he had been trying to give.”

“While not denying the proposition put to him by the Respondents that ‘there’s an overarching contract with each of the footballers, consisting of the written contract and the side letters’, Mr Red maintained that ‘it’s our view that the side-letter or the letters of undertaking do not need to be registered or lodged with the SFA’ (Day 3/31-32).”

So, in evidence, Rangers witness Mr Red, did not deny the proposition that there was an overarching contract with footballers consisting of the declared contract and side-letters, but “it’s our view” that side-letters did not need to be lodged with the lodge SFA.  Ms Poon suggests a fair conclusion is the side-letters were “actively concealed” as they could be “incriminating evidence”.

The SFA has issued disciplinary action against many clubs for erroneous registration but no club has ever faced a charge of actively concealing information necessary for proper registration.

The SFA president was a working director of Rangers when “our view” was established and was legally responsible for the club’s actions.  As I noted yesterday, but, frankly, can still not comprehend, on publication of this report the president announced himself “somewhat vindicated” by its contents.

Majority opinion:

John McClelland became a board member of Rangers in 2000 (legally responsible for conduct and oversight) and according to Wikipedia held senior board level positions in the electronics industry.  He was also a director of the SPL (legally responsible for conduct and oversight) between the company being formed 1997 and 2008.

The majority opinion, which favoured Rangers position in regards to income tax, noted the following about Mr Indigo, who was “a board member of Rangers since 2000. His previous career was in industry, latterly serving in senior executive roles.”

Mr Indigo “acknowledged that he was, however, aware of the overall content of arrangements made with players and did not consider these to be “secret”. He believed that the Trust had been used to pay appearance money and bonuses.”

According to rules established by SPL directors, including Mr McClelland, money paid in connection with football, including appearance money, has to be registered with the league.  It also has to be registered with the SFA.

When the Lord Nimmo Smith Commission reports, we will discover if this is what passes as vindication in Scottish football, or if a senior officeholder of the SFA, and others, will be dismissed in disgrace and banned, sine die, from the game.

We are busy pulling the next issue of CQN Magazine together.  If you would like to write an article, or take out some advertising , get in touch, article@cqnmagazine.co.uk.
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  1. South Of Tunis, back in 1996 I met the man who played left back for Real Madrid that day. His head was still spinning, but his admiration for Jinky never faded.



    “Himmy, Honhon, he drive me crazy” (while making a figure of eight in the air with his finger).



    hoopeddreams, yes, the FTT found in favour of Rangers, but even still, their evidence, for the purposes of the SPL Commission, is stunning.



    Rangers ‘won’ the only thing that didn’t matter to them, as no money will be paid, while incurring damning evidence against retention of league titles.



    It’s not even a pyrrhic victory.

  2. borgo67,



    I remember black Sunday as if it were yesterday. I was in deepest Yorkshire and my mate phoned me the score just as I was about to head back to sunny Salford. Bad, bad journey. CQN, as I’ve told Paul67, more than once was a godsend for those of us outside Scotland, to deal with such occasions.

  3. Thindimebhoy,



    There are contradictions in that article.



    It states that, “It was up to his own conscience that he stepped down.”



    But it also says, “Murphy-O’Connor declined to say whether he thought the pope had decided to bring forward the date on which O’Brien’s resignation took effect in direct response to the allegations”



    If O’Brien himself decided to step down now, surely there was no decision for the pope to make?

  4. Gordon_J backing Neil Lennon



    Not saying the article is de facto merely it raises alternatives to what the rags have rushed to print with here.



    Like I said I prefer not to make judgement until we know more.



    Of course we may never know the full story but that wont stop positive or negative speculation depending on the interests of the readers.

  5. The Comfortable Collective


    15:58 on


    26 February, 2013



    I get the point you are making.



    However, it might surprise you to learn that Pepsi and Coca Cola aren’t really in competition with each other.



    Basically,If you drink any of them at all, you either drink one or the other. An increase in price of one is unlikely to lead customers to abandon that product in favour of the other. At least it would take a fairly dramatic change in price for the consumer to change from their preferred brand.



    In short, they’re not even in the same market, although the notion that they are competing suits both parties as it encourages those loyal to both brands to better support their product – divide and conquer, a bit like the old Oasis v Blur hoohaa where both bands ultimately sold a lot more records as a result.

  6. Ntassoola @1626



    I am one of the lucky ones who had the pleasure of watching the great Celtic sides of the mid-60s-early-70s, and was (just) old enough to appreciate it all.



    Since then it has been a rollercoaster of incredible highs and horrendous lows.



    Currently the rollercoaster is near its peak -and appears to be edging ever closer to the summit.



    Whatever happens ‘tho it’s great to be a Celtic supporter – faithful ‘thru and ‘thru!




  7. Parkheadcumsalford



    Being self-employed and not part of a supporters club the only time I really properly spoke about Celtic was with my brothers . So to discover this site and read people like SFTB and others discuss Celtic and articulate it in a way I could only dream of was a godsend even for a Glasgow boy like me .

  8. Bhoys a re post






    A wee request…



    I need additional drainage and some quality landscape work in my back garden inc decking and patio/path looking for someone to design and do the work in ML1


    If you can do it or can recommend anyone get my email from Paul67 and send me a message….



    Building up to a big high or low depending on the result this week re LNS




  9. Paul67



    The FTT(T) provides a definition of “payment” that is of acute relevance, and assitance, to RFC(IL)’s defence to a substantial part of the charge (the Rule D9.3 part about undeclared payments).



    Moreover, if as I discuss above, the obligation in Rule D1.13 to deliver “all contracts of service” is qualified such as it only applies to “contracts of service…relating to payment” then the majority FTT(T) determination on what “payment” meant for the purposes of the EBT arrangements could also be of relevance for the second, “undeclared contract” part of the charge.



    I think the FTT(T) decision arguably makes it harder, not easier, for LNS to find substantivley against Oldco.

  10. Gordon_J backing Neil Lennon



    Not sure, I have not been following the story as closely as others.



    Is there a direct quote…?



    What I do know is that according to the Sun he was “ordered” to step down and he is now Savilles pal. Considering he was also pals with the royal family and many other A listers I thought that headline deserved some criticism



    Alas here in Scotland being a high ranking Catholic separates you for special treatment in the MSM and other places.

  11. It seems to me that an axiom regarding human behaviour is that we show more passion in anger than we do in pleasure. That can be evidenced on CQN by the number and volatility of posts when Celtic are viewd to have erred in some fashion or other. Currently, Celtic are playing their best football in the six years since I returned to Scotland. I understand that posts that say: “Wow! Celtic were very good today.” lack in interest but I wanted to say it anyway. Celtic are very good at the moment. Well done, Neil Lennon. You have, in unique circumstances, done a remarkable job.




  12. Gordon_J/Thindimebhoy,



    In football parlance I think the likelihood is that O’Brien was ‘mutually consented’. It was clear by Sunday lunchtime that his position was untenable. The fact that his spokesman didn’t come out fighting on Shortbread first think on Monday morning merely confirmed that his departure had been finalised.

  13. kickinthenakas


    Can`t help with the design but I will expect an invite for the poetry reading to celebrate completion of said work 0:-)




  14. Tallybhoy one of my claims to fame as a Celtic supporter was being amongst the 18,000 in attendance to watch Celtic beat Raith Rovers in the freezing rain at the end of Jan 1980. (Gate receipts £30,000). Real Madrid tickets on sale. I trousered four.



    News did not travel so fast then and many thousands queued in even worse weather next morning only to leave empty handed. I made a point of going to the pub that Sunday afternoon just to gloat. It’s a wonder someone didn’t punch me.

  15. Jungle Jim



    Agree. Have enjoyed almost every game since we came back from the winter break. The team are playing some really good football and I can’t wait to get back over to see it for myself.




  16. Thindimebhoy,



    This is from the main story in today’s Guardian: “The cardinal revealed in his statement that he had been asked by the outgoing pope to stand down immediately. Already due to retire next month, the cardinal stated: “The Holy Father has now decided that my resignation will take effect today.””



    It may well have been, as JohnnyClash points out, a “mutually consented” situation as the decision probably suits both.



    The Saville stuff is nonsense, an attempt to establish guilt by association. I’m sure rather a lot of people had their photo takes with JS over the years.

  17. It’s clear that what has happened is that the Pope accepted Cardinal O’Brien’s resignation nunc pro tunc at the end of last year.



    Had these accusations not materialised now, under normal circumstances, the Pope would have left it to his successor to agree with Cardinal O’Brien on the ‘tunc’, possibly arranging to name a successor at the same time. Following the accusations, the Pope seems to have decided that the ‘tunc’ might as well be ‘nunc’ to stop this from becoming at best a distraction and at worst a growing scandal as we approach the conclave. Cardinal O’Brien has seen the reasonableness of that position and seems to want to go as quietly as possible.



    I repeat that I hope his retirement is long and happy. The same goes for Pope Benedict.

  18. kickinthenakas



    Sorry I can’t help either, but I expect to receive an invitation to the grand opening!



    As does every other CQNer!



    Btw if you ever need to have a new central heating system fitted I know just the ghuys – big Tims both of them. Done two for me over the last ten years – bloody brilliant! Saved a fortune.



    They live in Ayrshire!




  19. Mort


    You may well see a game before I do. I go only to Home games and the next one will be in April!


    (Someone has organised the Wee Oscar bike ride for the Aberdeen game on the 16th of March 0:-) )

  20. Has anyone noticed how seldom Philvis gains a Page Podium?


    The New Article podium is, obviously, to do with PC technology. The Page Podium is much more of an intuitive talent. It`s a bit like comparing Kris Boyd and The King of Kings. The record books will show Boyd`s goals tally but they do not show the sheer quality of Henrik.




  21. Gordon_J backing Neil Lennon



    Yeah. I thought the rags running with the story that he was “ordered” to step down and the pics with Saville gave weight to their theme of associating the cardinal with child abuse.



    Quite wrong if you ask me but whats new in Catholic bashing Scotland



    You are more than likely correct the resignation was mutual and from my experience most of them are.



    I guess by the end of the week this story will be chip wrappers more importantly I hope Scottish Catholics find through their faith some solace which Im sure they will.



    I remember someone saying you dont need the middlemen to get closer to God although they do help to pave the way.

  22. Jungle Jim



    I think Philvis has a PBT – a Podium Benefit Trust through which he gains unfair podium advantage.

  23. JJ



    Summer BBQ for cqners on the cards when complete, probably the summer….


    Poetry obligatory! WB of course!

  24. The Battered Bunnet on




    I’ve been following your posts on the topic for quite a while, and appreciate them, recognising the reality that we are looking at an argument in Law/Rules, and that in every such instance there is a winning and a losing argument.



    Just for a moment, ignore that funds were placed into a fancy offshore trust structure, and consider instead that it was a regular, everyday Pension fund that was established for the benefit of the employee (player) and his family.



    Clearly, there would have been no tax liability on the employee until the applicable tax point was triggered on distribution of benefits some years hence, and therefore no tax issues to cloud judgement.



    However, payments would still have been made into the pension fund, following a set of criteria defined in the side letter/ letter of undertaking, by the employer for the benefit of the employee.



    In your alternative interpretations of D1.13, how would you be inclined to classify such benefits, given that they were defined in the side letter as being provided in return for playing football?



    Additionally, I paste Rule 2.2.1 of the SFA/FIFA Rules for the Registration of Players for your further consideration, not least because breach of this equally breaches SPL rules:



    Unless lodged in accordance with Procedures Rule 2.13 a Non-Recreational 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 FYI reads inter alia: “All payments to be made to a player relating to his playing activities must be clearly recorded upon the relevant contract and/or agreement. No payments for his playing activities may be made to a player via a third party.”



    Now superimpose the concession of Thornhill at FTT para 120 (and elsewhere in that decision) that the benefits paid via EBT were contractual when they were defined in a ‘side letter’.



    Considering the shift from ‘payment’ to ‘all terms and conditions’ does your view alter?







  25. Gene's a Bhoys name on



    The daily mirror in england also led with a saville photo with the cardinal and 2 pixillated kids – real gutter press stuff

  26. corkcelt



    “Anyone on here remember those pop out indicators”



    Listen, I can remember when it was just a hand that popped and a crank handle to start the engine. I just missed “the bloke in front waving the red flag days”.



    H H

  27. I am old enough to remember when the Fiat 126 was king of the road… It was so good Lada copied the design for their immortal “Riva”.



    I also remember cars with “chokes”.



    LNS? If there is a lawyers’ way out, he will find it IMHO.