The futures of four English clubs – Portsmouth, Leeds United, Notts County and QPR – are hanging in the balance while football’s governing bodies demand more information from owners. The Premiership is investigating Ali al-Faraj, the latest of a succession of white knights at Portsmouth, before approving the fourth foreign takeover at Fratton Park. The Football League has asked for more details about the ownership of Notts County and Leeds United. The situation at QPR is under investigation in the wake of the ‘Crashgate’ scandal: this could be the most difficult of the cases to resolve.
The futures of four English clubs – Portsmouth, Leeds United, Notts County and QPR – are hanging in the balance while football’s governing bodies demand more information from owners. The Premiership is investigating Ali al-Faraj, the latest of a succession of white knights at Portsmouth, before approving the fourth foreign takeover at Fratton Park. The Football League has asked for more details about the ownership of Notts County and Leeds United. The situation at QPR is under investigation in the wake of the ‘Crashgate’ scandal: this could be the most difficult of the cases to resolve. The uncertainties are casting a shadow over the game and its ability to apply a stringent ‘fit and proper persons’ test to weed out potentially unsafe buyers of clubs. The Premiership and Football League operate separate tetss, although both have been tightened significantly. FA supremo Lord Triesman has called for a single test for both leagues and demanded the full details of owners and investors in any club. The Notts County case illustrates fears that the money trail in takeovers too often leads to tax havens where further enquiries are not welcomed. The Football League has issued a new policy that it must in future be told about all ‘ultimate beneficial owners’ in clubs.
Let’s look at these four cases in a little more detail:
- Portsmouth It would seem as if Portsmouth have finally found their saviour, but the Premiership is concerned about the ‘opaque’ nature of the investment in Portsmouth which has been sold to Falcondrone Ltd., a British Virgin Islands based company. Ali al-Faraj put in an immediate tranche of £5m of which £1.8m went on paying the wage bill and £2m is understood to have paid off a bill to HM Revenue and Customs. There were also debts to two agents. Portsmouth will need another £5m to get them through to December when the next tranche of Premiership broadcasting revenue will arrive. Details of al-Faraj’s wealth and business career remain vague. The Saudi Arabian property tycoon was not only unknown in British football circles, but also had no profile among football’s power brokers in his home nation.
- Leeds United They were rescued from administration by Ken Bates on behalf of Forward Sports Fund, a company registered in the Cayman Islands. Bates, the Leeds chairman, admits he does not know who is behind Forward Sports. The League wants answers.
- Notts County The League wants more details about QADBAK, said to be Swiss-based but registered in the British Virgin Islands, before the takeover is given approval. Peter Trembling, the executive chairman, says that the filing of the confidential paperwork to answer the two outstanding queries from the Football League will occur imminently. He predicted that by the end of the week the Hyat and Shafi families would be the club’s majority shareholders as part of a private investment trust. The families are said to have extensive business interests throughout the Middle East, Japan, Kazakhstan and Pakistan, with real estate investment interests in Europe, the Middle East and Asia. An Anwar Shafi was supposed to attend last Saturday’s game against Torquay but didn’t turn up. The Punjabi businessman Anwar Shafi quizzed in Islamabad last week preferred to keep his distance from the County takeover. Trembling expects that a member of the Hyat family will attend a game soon, but probably incognito. The middleman in the deal is said to be Russell King who has been the focus of allegations of financial irregularities and criminal investigation. What has happened to Notts County may be a boost for the club’s fans, but is so far not much of a victory for transparency in football finances.
- QPR The League wants Fiavo Briatore to prove why he should not fail the ‘fit and proper persons’ test after being thrown out of Formula One after the ‘Crashgate’ affair. This requires that no club director should be ‘banned from the administration of a sports governing body or such other similar forms of disqualfication.’ The League has to proceed carefully and has taken legal advice. How do you remove a club chairman when he co-owns the club? Bernie Ecclestone, a QPR director, has told Briatore not to back down under pressure for him to quit before he is charged by the League. The whole issue is a legal minefield and could degenerate into a confrontation that could run on and on.