Untold Arsenal: Arsenal News. Supporting the Lord Wenger in all he does » British Football: corruption in progress
By Tony Attwood
I have, from time to time, let slip that I feel that corruption is rife in football in England – and indeed elsewhere. The little affair of Lord Triesman and his allegations about bribes in the world cup didn’t come as a surprise, nor did it that it took FIFA just a week or so to prove that it wasn’t true.
This is how it goes in football. Football, as far as I can see, is bent. Not because players are nobbled for matches (although I have my doubt about a number of referees) but because the whole essence of life in certain clubs leads to corruption.
So here’s a couple of stories of football corruption which takes in Derby, Leeds, Barnsley and Cardiff. There’s no Arsenal in this – save that it is a warning of just where things can go to if you put crooks in charge, or if you go over to the “winning at all cost” approach.
I’m choosing the Derby story, despite the fact that it is a year or two old, because what the judge said seems to me completely apposite.
In Derby’s case the game was this: these highly professional men (accountants etc) took over the club that was in debt for £3 and put themselves in positions of power (chief exec, finance director etc) and then paid themselves £125,000 plus VAT each. They “forgot” to tell the board that this was what they were being paid.
The money was then channelled around various off shore accounts and companies. When found guilty, the judge, Ian Alexander QC, said of the three, “You, like so many people who commit business and professional crime, somehow give the impression that you do not believe the rules apply to you, and that what you do in your business life is perfectly acceptable.
On 20 July 2009, two of the directors, Messers Mackay and Mackenzie were both sentenced to 3 years in prison by Judge Alexander at Northampton Crown Court.
Peter Ridsdale is not in prison and there is no suggestion that he should be, but from the outside, and I stress with no inside knowledge of his world at all, he looks to me like a man who could be described through Judge Alexander’s words.
Ridsdale has a company that is under investigation, and has just left a club that may be called “in total disarray”, but he is not in prison. His story however does cover a number of different clubs.
Peter Ridsdale was chairman of Leeds United and took them to the semifinal of the Champs League. As such he was considered a “good thing”.
But the issue of Ridsale is the issue of football. How much are you willing to pay for that success? Does it matter if such success as you had is sustainable?
And let’s not make a mistake – what Ridsdale did for Leeds was success. From nowhere they got to the semis of not just the Champs League but also UEFA Cup. And from there they went down into the 3rd division.
In order to get success Ridsdale borrowed money the club could never repay unless it was in the Champs League every year. You may note that Arsenal, who have had 10 years of Champs League don’t gamble on that.
When it was all revealed Ridsdale said his only mistake had been to allow David O’Leary to spend so much money. When he went in 2003 Ridsdale Leeds was over £100m in debt – a figure unheard of at the time. (Incidentally it shows how far we have gone in seven years. Now we accept £750m debt as the norm for a Champs League semi-finalist.)
Later Ridsdale published United We Fall: Boardroom Truths About the Beautiful Game which said that David O’Leary was involved in “a secret deal with bung agent Rune Hauge to take Rio Ferdinand to Leeds.”
He also said that Pino Pagliari, another agent had offered illicit payments when Robbie Keane went from Leeds to Tottenham.
After Leeds, Ridsdale took Barnsley on a similar ride, helping them at first, and then taking them to the edge.
Then he went to Cardiff City, and left the club at the end of this season just finished. It is hard to get exact facts on Cardiff’s finances at the moment, as a winding up order is pending, (their fourth this season, which either suggests that they are bankrupt or else exceptionally careless).
Among other things, Ridsdale is reported to have borrowed against the play off finals money, so there is no extra income to come in now, to pay off Revenue and Customs. (Had Cardiff failed to get to Wembley then they would not have been able to pay that loan back, and that would have been the end, there and then.)
He also raised money from the fans to buy new players by selling advance season tickets, and then when it was collected in, used it to pay off debts that he had previously denied existed. Because those tickets were so discounted, the amount of money they will get in for the next season in division II will be severely depleted.
In the end your run out of future
We may note a similar tactic in both the case of Leeds and Cardiff – borrowing against the future in order to secure success. It can be done, but it doesn’t allow for continuity. In the end you run out of a future to borrow against.
Mr Ridsdale owns WH Sports Group. WH charged Cardiff £1,359,490 consultancy fees. Then, despite earlier statements that the firm had assets of £500,000 it went into liquidation with debts of £373,555 to the Revenue, and £26,444 to Barclays, and no assets of note. After the liquidation Ridsdale paid himself £7500 for preparing a statement of affairs for the Revenue. The liquidation of the company is work in progress.
Will Cardiff survive? It has a lovely new stadium, but is hopelessly in debt with no chance of paying off its debts. Unless someone wants to buy it, it is going to go the way of Portsmouth. For what its worth, I suspect Hull will go that way too. And then we have the forthcoming court cases of Arry, and the other fellows from Portsmouth – although of course everyone is innocent until proven otherwise.
As I said, you run out of future. Man U and Liverpool are doing much the same. Overall it doesn’t look good.
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