Ex-Livingston FC chairman goes on trial accused of £2.3m RBS fraud

Published on Tuesday 18 August 2009 22:03

THE former Livingston Football Club chairman and one-time Celtic director, Dominic Keane, has gone on trial accused of a £2.3 million fraud charge.

A jury heard yesterday that the West Lothian club had enjoyed unparalleled success during Keane's time in charge, along with business partners Willie Haughey and John McGuinness.

It had risen in a few years from the lower divisions to having a team and a stadium which graced the Scottish Premier League.

"He could not have worked harder for the organisation," Tony Kinder, 60, a former fellow director said of Keane.

However, disagreements with Keane led to Mr Haughey's involvement curtailing, and the club was put into administration in 2004 with debts of 3.5m, the High Court in Edinburgh was told. Keane, 54, of Aitkenhead Road, Glasgow, denies forming a scheme to obtain money from the Royal Bank of Scotland between 1999 and 2001.

It is alleged that as part of the scheme, he duped Mr Haughey, the prominent west of Scotland businessman, and Mr McGuinness, a 10m lottery winner.

It is claimed that Keane pretended to a chartered accountant that he, Mr Haughey and Mr McGuinness had formed a partnership, and that it required funding for the development of Livingston FC.

He allegedly caused the accountant to submit a report, supporting an overdraft application, to RBS.

According to the charge, Mr Haughey knew nothing of any partnership but Keane had placed a letter in front of him for his signature, suggesting it was a routine document which he did not need to scrutinise.

In fact, the charge states, the letter represented to RBS that the partnership existed and that Keane was authorised to give instructions to the bank on behalf of the partnership.

The document also bound the three men, jointly or individually, to repay debts incurred to the bank by the partnership.

Mr McGuinness was said to trust and rely on Mr Haughey's business judgment.

Keane allegedly pretended to Mr McGuinness that Mr Haughey had signed up for the Livingston venture, and Mr McGuinness agreed to become involved. He put up life assurance policies worth 1.75m as security to the bank.

The indictment claims that Keane fraudulently obtained overdraft facilities, a bank guarantee, loans and re-financing totalling 2,336,039.13 from RBS, and as a result Mr Haughey had been rendered liable to court action for recovery of the debt and Mr McGuinness had lost the life assurance policies and all of his other personal assets.

Mr Kinder, a senior business studies lecturer at Edinburgh University, said he had become an unpaid, non-executive director of Livingston FC while he was a councillor in West Lothian and the club was owned by Bill Hunter.

He explained that West Lothian Council owned the club's ground, Almondvale Stadium, and the land on which it was built.

The club had been up for sale, and Mr Haughey approached him. Later, Keane had attended meetings.

Mr McGuinness was also involved. Keane became a director and chairman, and Mr McGuinness also served as a director, but Mr Haughey had not joined the board.

The trial continues.