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Rangers: four due in court on fraud charges

IbroxFour men will appear at Glasgow sheriff court on Monday in connection with the alleged fraudulent acquisition of Rangers Football Club three years ago.

Police from England and Scotland carried out a series of dawn raids on Friday to detain the men and an arrest warrant was issued for the arrest of former owner Craig Whyte on fraud charges.

A Police Scotland spokesman said: “Around 6am on Friday, Police Scotland officers, assisted by officers from Thames Valley Police, Cheshire Police and Surrey Police, attended a number of addresses in England and detained four men.”

The arrests follow a year-long investigation into affairs at the Ibrox club which fell into administration and then liquidation, leading to it being demoted to the bottom tier of the SPFL.

Those arrested were Gary Withey, David Grier, Paul Clark and David Whitehouse. Withey, worked for Collier Bristow, the London law firm which advised Whyte on his purchase of an 85% shareholding in the club from Sir David Murray for £1 in 2011. Whyte stepped in when Murray came under pressure to pay off an £18m loan to Lloyds Bank.

Clark, Grier and Whitehouse were employees of Duff & Phelps, appointed as administrators on St Valentine’s Day 2012 after the club failed to meet a series of PAYE and VAT demands from HMRC.

The tax authorities later threw out a creditors voluntary agreement and in July 2012 the club was declared bust. The first team squad agreed to play and let the club fulfil its fixtures in return for being released from their contracts.

But the off-field problems  were far from over. An investigation was already under way into the use of an employee benefit trust to pay the players which had been set up by Murray International Holdings in 2000.

Whyte raised almost £25m by mortgaging three years’ worth of season ticket sales to the Ticketus Agency in order to pay off the bank debt. But this was declared void when the business entered administration in February 2012. Ticketus successfully sued Whyte for £17.7m and he was later banned from being a company director for 15 years in the Court of Session in Edinburgh.

In June 2012 Former Sheffield United owner Charles Green snapped up Rangers’ assets via his Sevco consortium, in a deal worth £5.5 million. That same month a criminal investigation was launched into Whyte’s takeover of Rangers.

Sevco issued shares  in December 2012 which raised £22 million, but chief executive, Graham Wallace revealed in April this year that the the club had burned through £70 million.

A further share issue in August raised only £3.1 million and the club has once again found itself in financial difficulty with the possibility of entering administration for a second time.  Sports Direct tycoon Mike Ashley, the owner of Newcastle United, acquired 8.92% of Rangers and has  provided £3m in two loans to give it working capital and pay the players. He is forbidden from owning more than 10% under Scottish Football Association rules.

Ashley struck a hard bargain, removing Wallace and finance director, Phillip Nash and installing former Newcastle United managing director Derek Llambias initially as a consultant but now as a non-executive director. He will oversee a cost-cutting programme but his appointment has been seen as a further tightening of Ashley’s grip on the club, although he relinquished naming rights.

David Somers, chairman, said in a statement issued to the London Stock Exchange last week that Rangers is likely to require further funds. This is thought imminent as the club may need money to pay next month’s wages.

A spokesperson for Duff & Phelps, said: “Duff & Phelps has become aware that three employees in the United Kingdom have been detained for questioning in connection with work performed for Rangers Football Club. This work was commenced while these employees were part of MCR Partners, prior to its acquisition by Duff & Phelps in October of 2011.

“Duff & Phelps has performed an internal investigation and commissioned an independent investigation of the related matters. As a result, we believe that our work for Rangers was conscientious, thorough, and properly performed in every respect.”

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