KPMG, Leeds United and offshore
KPMG are in a spot of bother again. As has been mentioned here before, they proved compliantly gullible when appointed as administrators of Leeds United, put into liquidation at the behest of its chairman, Ken Bates and with the apparent willing cooperation of its mysterious offshore creditors, only for Bates to buy it straight back with the support of those self same creditors.
Now the Revenue have rightly challenged the deal, which was clearly abusive. So KPMG have had to buy the club back from Bates to put it up for sale again, with Bates being the likely buyer again. Which will then give HMRC the only option of liquidating the whole thing.
Three things are important:
1) HMRC have acted properly;
2) KPMG have acted appallingly;
3) There’s yet more more evidence that offshore causes nothing but harm.
When will KPMG learn? Perhaps they never will. They remain the biggest offshore operator of the Big 4, after all.
According to Tom Bower’s Broken Dreams, Ken Bates has practised similar manoeuvres in the past.
“To implement the plan, Bates flew with [insolvency practitioner, later jailed for 4 years for cheating the Inland Revenue, John] Papi to Guernsey. Sitting in the office of Patrick Marrin, an accountant, the two visitors watched the unfolding of a paper trail between banks and lawyers, prompted each time by Bates signing a succession of forms. By the completion of that circle, Chelsea Village became the CFAC’s preferred creditor and the Royal Bank of Scotland possessed a secure debt in Chelsea Village rather than an unsecured debt with CFAC. On his return to London, Bates had secured possession of Chelsea free from the threat of insolvency, which he and the RBS stood to gain at the expense of the other creditors.”
Richard - this evening’s news indicated there are more bidders in play. But…I guess for the majority of those following this story, the complexities are tough to fathom. Maybe something could be done in that area to unpack the machinations that cloak these transactions in ways the British public can understand. That way, the acts of these individuals can be better understood?
And we see today, that, sure enough, KPMG have sold Leeds straight back to Ken Bates. No doubt now, we’ll hear from certain quarters how the evil and oppressive Revenue is threatening the enjoyment of countless fans by pursuing a vendetta, whilst KPMG laugh all the way to the bank.
As the Leeds saga unfolded in May this year we were turning the pages of ‘Broken Dreams’ over and watching real life imitate the written word on a day by day basis.