Rangers administration: Craig Whyte may face criminal investigation, claims former Rangers boss

By GARETH ROSE
Published on Thursday 23 February 2012 12:48

EMBATTLED Rangers boss Craig Whyte used borrowed money from the sale of season tickets as proof of funds to convince Sir David Murray to sell him the club, former chairman Alastair Johnston has claimed.

Mr Johnston also said he believed Mr Whyte could face criminal investigation based on evidence he had submitted to the Insolvency Service, Strathclyde Police and the Crown Office.

Mr Whyte finally admitted on Tuesday that he used Ticketus money to “complete the takeover” of the club in May last year, having previously denied it.

The money was paid by Ticketus in return for the rights to sell three years’ worth of season tickets at the club.

However, Mr Johnston says he has seen evidence – and shared it with the authorities – that indicates the money was also used when Mr Whyte offered “proof of funds” to former owner Sir David.

Mr Whyte’s ability to continue to fund the club through his own wealth was a prerequisite to the deal going through.

The claims will cast new doubt over whether Mr Whyte had the necessary money to become owner of Glasgow football club.

Mr Johnston, who is a director of sports and entertainment group International Management Group, said: “I’ve submitted material and requested that the Insolvency Service look into it, specifically, whether there was any contravention of the financial assistance provision of the Companies Act.

“And I’ve asked the Crown Office and Strathclyde Police to do the same thing.

“These are only allegations. If, over a period of time, they prove to be founded, they will be criminal acts.”

In his statement on Tuesday, Mr Whyte said he provided Sir David and Lloyds Banking Group with proof of £33m in funds in November 2010.

However, Mr Johnston says a meeting to establish this took place at a later date.

“The evidence that was presented as proof of funds to Murray International, on 7 April, before the deal was done, was the Ticketus money,” he said.

“The amount that was required to be proved was £27.5m, and that was provided by Mr Whyte’s lawyers, Collyer Bristow.”

He believes that if the terms of the purchase have been breached, the £18m debt the club reportedly owes Mr Whyte could be cancelled, loosening his grip on Rangers.

Mr Johnston said: “[Sir David’s] Murray International (Holdings Limited) has, as part of the sales agreement, certain rights in respect to enforcing compliance of the sales purchase agreement.

“If there was failure to comply, then Murray International could bring an action that the consequence would be a waiving of the debt.”

However, football finance experts questioned whether Mr Whyte has broken the law.

Neil Patey, partner in Ernst & Young, said: “From the outside, there is no evidence that he has broken the law and it could well be possible to do what he has done without breaking the law.

“Fans and the public may feel he has misled people, but that does not mean he has broken the law. As he has described it, he borrowed the Ticketus money pre-takeover and personally guaranteed it from his group assets, which is legal.”

Ken Pattullo, partner with accountants Begbies Traynor, said: “What have Ticketus acquired? They claim to have acquired the next three years’ season tickets, but is that decision bound on the administrators?”

Asked whether he thought Mr Whyte might face criminal action, his spokesman said: “Craig Whyte does not believe that is a likelihood.”

A spokeswoman for Strathclyde Police confirmed it had received information from Mr Johnston, which was being “examined by police officers”.

A Crown Office spokesman added: “Strathclyde Police are considering the information provided, and it would be inappropriate to comment further.”

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