The Glib and Shameless Duplicity of King’s ‘Lost’ £20m in Murray Sports Ltd

Could Mr King, an individual whose international notoriety for mendacity is unequivocal, be engaging in his biggest lie to date in regard to his claim that he lost £20m from his investment in Murray Sports Limited? Mr King has claimed that he was duped by Sir David Murray. Mr King has repeatedly claimed that he lost £20m investing in Rangers. Mr King wears his loss as a badge of honour to prove to his legion of fans that he is a Real Rangers Man who deserves our respect because he suffered more from the collapse of Oldco than most.

To prove that he is lying, yet again, I have drawn on two sources and a South African article which itemizes the tax assessed as owed by Mr King on income from 1990 to 2001 inclusive. The following statement, from SARS spokesman Adrian Lackay, defines the scope of the assessment:  “There is nothing wrong with the tax assessments. They are based on benefits King received from the assets — not the assets themselves.” I have added the bold text for emphasis.

One of King’s  individual tax liabilities was R200m on benefits received from Rangers Football Club plc, not Murray Sports Ltd where his initial investment was made. At the prevailing exchange rate in 2001 this was £11.5m. The tax rate was 40%. Therefore  Mr King not only received his money back, but received an additional £8.75m

At this point I have no information as to whether the £28.75m was paid to Mr King via an Employee Benefit Trust, however should Mr King consider this emolument a loan, it might explain why he maintains the loss of £20m to this day.

I trust the scales will fall from the eyes of those who were sufficiently gullible to be persuaded by King’s duplicity?

The anatomy of an underfunded Coup D’etat

I have first hand experience of using a firm of PR agents to promote a company. For a fee of £10,000 plus VAT, my words on a recently acquired software suite were duly inserted in a trade magazine, accompanied by an advertisement feature that cost almost double that amount.

Anyone who wishes to view how this works should take a look at the output of Chris ‘Union’ Jack at The Herald. Rangers, the client, instruct Level 5, the agent, to promote season ticket sales. A deal is then struck with The Herald commercial team for what is known as a promotional package. A junior hack, Chris Jack, is then provided with the bullet points as written by James Traynor or Stephen Kerr that he cuts and pastes into an article that gives the impression that it’s a piece of sports reportage, when it’s true purpose is season ticket promotion. Other examples of Level 5’s handiwork can be seen at one of Trinity Mirror’s stable, The Sunday Mail under several by-lines.

However Level 5 can do much more than Trojan Horse promotion. They can create the myth of a corporate Messiah. Dave King’s attempt to convince fans to send their season ticket money, to an escrow account, controlled by King with Richard Gough as de facto  curator, flopped spectacularly. The fact that he had to surrender his passport to the Crown Prosecution Authority of South Africa until August 2013 precluded the possibility of a personal appearance.

Armed with a briefcase which was empty save for an A4 plastic folder, King attempted to convince David Somers to provide him with a written guarantee that his back of a fag packet offer of £16m had the support of 75% of shareholders. This is presumably why he brought the folder. However he did not have any proof of funds nor was he willing to name four members in his consortium of eight individuals. It was obvious to David Somers, that King would have used any written proof of acceptance to canvass financial support from third parties without investing anything in the scheme other than his time. King’s scheme was as transparent as his folder.

For his next trick he managed to convince his concert party to buy shares for themselves and in his name, being careful not to disclose his relationship with Taylor as this breached the 30% compulsory equity offer threshold. King then contacts James Traynor, who had engaged in pro-King PR work prior to Level 5, to commission him to create positive media coverage of his bid for control, and simultaneously spread what is known in the dark arts as fear, uncertainty and doubt about the current regime. It is no coincidence that the Rangers supporters portals were inundated with letters from concerned supporters of  Newcastle United. Would it surprise anyone to know that the majority of these originated in Glasgow?

Candy-coating a penniless spiv masquerading as a white-collar criminal was Traynor & Kerr’s biggest challenge. Soundbites such as ‘favourable result’ joined a growing lexicon of positive messages about King, that were fed daily to The Daily Record. Keith Jackson was banned from both Ibrox and Celtic Park so anything on Rangers was manna from heaven. This was primarily Stephen Kerr’s handiwork. Press conferences were organised with pre-written questions provided by Level 5 to the hacks to ensure they did not delve into how King could afford to run Rangers. There was talk of a choice of NOMADS and of Mike Ashley being a man ‘one can do business with.’ One lie soon followed another as those who knew that he had been wiped out financially and was lucky to escape an 82 year prison sentence, looked on at the PR revisionism with slack-jawed amazement. Anyone who doubted King was provided with the level of comfort of a sleuth of three benevolent bears that were backing King’s ambitions.

Of course it was all a pack of well-conceived, finely polished, lies. As for Ashley being someone they could do business with, he called an EGM to highlight how underfunded they were and their inability to repay him the money that was loaned to RIFC. He also took them to The High Courts of Justice (Chancery Division) to shut King up. King’s decision to leak details of the confidential Rangers Retail contract to The Daily Record, via Level 5, cost the club a minimum of £400,000.

How much did all this PR cost? Conservative estimates from informed sources suggest a minimum of £600,000 for the lies that delivered King, Murray & Gilligan, not one of whom have any appreciable wealth to add value to Rangers. Of course no-one would expect someone, notorious for his parsimony,to actually pay for his PR. The invoices from Level 5 continue to be sent to Rangers, not King.

Not one of the four hundred companies listed on the Johannesburg Stock Exchange would consider King as an non executive director. Everyone knows he is a crook and his made up qualifications a crock. By portraying King as a Real Rangers Man, we now have a chairman cut from the same cloth as Craig Whyte. Whyte’s path to pre-pack administration was aided and abetted by the positive press coverage of James Traynor.

Seven men have been recently indicted for crimes against Rangers. I would add James Traynor to that list.

When you add the cost of the court case to the creation of the Messiah Myth, King’s self-serving decision to be our chairman has cost Rangers a million pounds. He has spent more on PR and court costs than has been spent on the team on the park and it’s beginning to show.

The Oldco/Newco Imbroglio

In my preceding three articles I have provided some background on Dave King, whom, in my considered opinion, is a white-collar career criminal. I also have misgivings about Paul Murray, whose naked ambition to rejoin the board led to him liaising with this criminal. I don’t see the point of John Gilligan, other than to make up the numbers in the unlikely event that Sports Direct Retail plc chose to make good on their appointment of two directors as per the loan agreement. According to a recent statement all directors are working pro bono, which I do not accept. King flies BA First from Johannesburg to London, and in business class from London to Glasgow, which is circa £10,500. This is paid for by the club. Murray & Gilligan have generous expense accounts that will lead to ‘benefit in kind’ taxes. These individuals are not running Rangers as a hobby. There will be bonuses for promotion, which is a shoe-in this year. Some might speculate as to why we need an absent chairman who resides in South Africa, and who then flies in to make contradictory statement to the media. Everything King does is self-serving. Those who think he he is a man of wealth who will make an appreciable difference to Rangers, should acquaint themselves with my well-researched articles. Those who believe he is a rain-maker who will garner investment from elsewhere, should realize that he is still a pariah in business circles in South Africa for allegedly perpetrating numerous frauds.

King’s defence of these alleged frauds is ingenious, as one would expect from any long-term confidence trickster. King does everything as part of a trust and then claims that he does not have executive power in this trust. Of course, to make it even more difficult to secure a conviction he uses what is known as The Russian Doll Model, where each trust is a subsidiary of another company in another locus. He then engages in The Revolving Door Model where the parent of these trusts changes by moving capital between them so as to not only evade tax and allegedly launder money, but to confer temporary nominal control. So if you wanted to challenge King on his alleged  fraudulent sale of software (to choose one from many examples), you would have to hire forensic accountants to discern which trust benefited from the fraud, and then attempt to link King to this trust, and then prove that he had executive control. Then you would have to go to court in The British Virgin Islands/Guernsey/The Sunshine Islands and South Africa.

However King’s latest statement on Oldco, Rangers (1L), has led to some concern among informed Rangers fans. King stated that the current club is not the Traditional Rangers and that he and his board are looking at transferring the assets of RIFC to Rangers (1L) and then removing the latter from liquidation. He then disingenuously claimed. in an obvious pitch to the supporters, that his motivation was to silence our detractors who claim we are a new club with no claim on our history.

King is lying here on so many levels. The first lie in his statement is that he and his shyster board owns and controls the assets. They are currently in dispute and will almost certainly be secluded at the preliminary hearing on October 16. Then there is the mythical offer of 60p in the pound to the creditors of Oldco, King has recently been subjected to the corporate equivalent of a warrant sale. It would be against his long-held traditions of parsimony to offer 1p in the pound to creditors, which is about as much as he could afford. Then there is the complex legal argument of arranging to sist Oldco from liquidation. This is rarely possible, but would have little chance of success unless the creditors were paid in full. At this point HMRC are owed £14m and change, but with 5 cases referred back to First Tier Tribunal, and the current legal bill to BDO now exceeding £5m, should HMRC take their appeal all the way to The Supreme Court in London these fees are likely to escalate.

Notwithstanding the fact that no-one actually knows whether the £70m claim by HMRC actually failed in its appeal.There is a rumour circulating that it has but no-one should doubt that HMRC will continue to seek legal redress in London.

The truth behind King’s interest in Oldco is that Ibrox, Auchenhowie and the IP, may revert to Oldco. There are others who share this view. Chief among these is Craig Whyte.

Mr Whyte and his associates have been inordinately busy of late. Law Financial plc, has recently appointed Liberty Corporate Ltd, a British company whose only director is Whyte’s father, to its corporate board; having previously removed Craig Whyte as a director from the board of Law Financial plc as he has been disqualified as a director for 15 years by Justice Tyre.This is highly significant.

There has also been activity in regard to The Rangers FC Group Ltd, which was formerly known as Wavetower, where four years of backdated accounts have now been posted which suggests that this formerly dormant company is now active.

A Companies House document,MG01 re Liberty Corporate, discloses that the Rangers FC Group Ltd  granted a security in the form of a debenture over all of its assets, present and future. The main  assets of Rangers FC Group Ltd were an 85% shareholding in Rangers Football Club plc and rights under a floating charge over said club’s assets in security for whatever debt is owed to the RFC Group Ltd.

In summary, Law Financial Ltd own the debenture floating charge. This is being challenged by BDO. Should the assets revert to BDO, they will sell them to the highest bidder. This won’t necessarily be Rangers. It most certainly won’t be King as he does not even have the £5m to pay his debts to Ashley. I was a critic of King’s decision not to repay Ashley, but with the ownership of the assets now in dispute there is no business imperative to repay Sports Direct Retail Ltd. Effectively King may only own 14.53% of an SFA licence, Edmiston House and the Albion Road car park.

Craig Whyte’s recent activity provides more credence to my theory (I don’t claim exclusivity) on what has occurred since he purchased 85% of RFC plc from SDM. I stress at the outset of my argument that I believe that this transaction was legal and above board, despite conspiracy theories to the contrary.

I posit that Whyte took over at Rangers with the intention of engaging in a pre-pack administration, thus keeping the assets under his control and with a view to ridding the company of debt and potential liabilities. On 14/2/12 Whyte initiated his plan and chose Duff & Phelps. Key personnel at D&P at that time had assisted Whyte in buying RFC and securing the Ticketus loans. There should have been an ‘arms length‘ partition between these activities

Whyte was not prepared for the outcry from the fans and the media. He had executed this strategy many times before with other businesses. But Rangers is by no means just another business. Whyte needed a front man to profit from his strategy as the SFA were threatening to exclude him from being a director of the club should it exit administration, as per his plan.

Charles Green was presented as a leader of a consortium that had no connections with Craig Whyte whatsoever. In my opinion, he was actually Whyte’s place man. As Green was attempting to gain a licence from the SFA, a  convenient ‘feud’ between Whyte and Green was created to allay any suspicions that they were acting in concert. They then engaged in a faked Punch & Judy show, with an accompanying staged recorded narrative, which was leaked via Charlotte Fakes as ‘evidence’ of their business disagreement

This charade resulted in the supporters putting their trust  in Green and buying season tickets at levels never seen before in the lower tiers of Scottish football. Whyte’s security on the assets was water-tight. It was specifically designed to survive any liquidation event. It would have been impossible for Green to do what he appeared .to be doing without Whyte’s consent and cooperation whilst that security was in place. The ‘Switcheroo‘ was a ruse.

Whyte’s objective was to eradicate debt and subsequently float Rangers on the stock-market, thus profiting significantly. It’s important to note that the shareholders in Sevco Scotland/The Rangers Football Club plc, sold the assets acquired from D&P for £5.5m to RIFC for £25m, and were paid in shares.

As soon as the shares were sold, the perpetrators of this alleged scam were home free.

The consequences of what I posit is an elaborate sting operation, will be played out in court. Only then will we see whether my conjecture is accurate.

If this was not enough for Rangers supporters to endure, we are now in the hands of someone much more dangerous than Whyte. Whyte has been indicted and charged in regard to an alleged premeditated crime. Mr King was also charged with racketeering in South Africa. It was alleged that Mr King had liaised with an underworld figure, via a go-between. The fact that only five witnesses were prepared to testify against King and Morris was dismissed by King as a coincidence. Mr Whyte has much to learn in regard to how true masters play the game.

I have kept the last part of this imbroglio to the end as it is a complex affair. Liberty Corporate Ltd was a wholly owned subsidiary of Liberty Capital Ltd, which was a Craig Whyte British Virgin Islands (BVI) holding company.

Ticketus, who successfully won a court order against Whyte in London to the value of £17.1m, then proceeded to pursue the liquidation of Liberty Capital Ltd by order of The Eastern Caribbean Court. However the value in Liberty Corporate Ltd, which is now assigned to Law Financial, is currently unaffected by these liquidation proceedings.

Should the assets revert to BDO, I suggest that the supporters club together to buy them to rid ourselves of King and whatever scams he has up his sleeve. We have had enough of the fraudsters and people like King impersonating Real Rangers Men.

Dave King – A Tax Rebel Without Cause

When it comes to fiction, no one does it better than Dave King. The following statements were given to The Herald :

“My settlement with the authorities in South Africa provides me with a unique status of credibility.

I don’t know anyone else on the planet who has the level of clearance that I now have in terms of court-approved rulings.

I have made all my ­disclosures to AIM and they can have no basis for anything other than unequivocal support.”

As to his ‘unique status of credibility please allow me to demur. Not paying any tax whatsoever on the activities of a company where he profited by audacious share manipulation does not in any way bestow credibility. Declaring your annual income as less than £5,000 when you are picking up £82,000 per month from your British Virgin Islands/Guernsey tax havens somewhat flies in the face of any credibility. Attempting to pass yourself as a poorly paid caddie to Gary Player at The Masters, was certainly unique but scarcely credible. However, even when you think Mr King could not be more audacious, he attempts to be removed as a taxpayer from The South African Revenue Service register.

As for his ‘settlement‘  was Mr King referring to his £43.7m as payment for tax evasion, his £550,000 contribution to Criminal Assets Recovery Association or his £206,172 in fines? Was it remiss of Mr King not to mention that he was convicted of 41 criminal offences, each of which carried a consecutive sentence of two years imprisonment, to a total of 82 years.

Allow me pause when reflecting on his ‘court-approved rulings.’ Was Mr King referring, in an oblique way, to the following ruling  by Judge Brian Southwood and two assessors (both Crown Court Judges) handed down in the North Gauteng High Court in October 2010? Justice Southwood stated:

“The court has seen King testify for four days and are unanimous in finding that he is a mendacious witness whose evidence should not be accepted on any issue unless it is supported by documents and other objective evidence. It was remarkable that King showed no sign of embarrassment or any emotion when he conceded that he had lied to the (SARS) commissioner in a number of his income tax returns. In our assessment, he is a glib and shameless liar.

When three Crown Court judges come to the conclusion that Mr King is a glib and shameless liar, nothing could be further from the implied endorsement in Mr King’s statement.

Finally let’s look at Mr King’s spurious claim in regard to the unequivocal support of AIM. Forgive me for pointing out the obvious Mr King but no NOMAD was prepared to represent you in any way and W.H. Ireland resigned when they became convinced that your underfunded hostile takeover would succeed. They chose not to in any way support your last ditch attempt to transfer the listing to ISDX via your JP Jenkins matched bargain service. AIM subsequently de-listed RIFC.plc.

In what parallel universe is this unequivocal support? Any rational individual might conclude that 41 criminal convictions might well be a barrier to entry on any exchange.

But no-one could ever accuse Mr King of being rational. Spending £50m on legal fees is not rational. When we include the £20m in Murray Sports and £44,45m in taxes and fines, we can conclude that only £5.55m was left from his £120m equity malfeasance at Specialist Outsourcing. However even this amount had gone as The Scorpions, acting for SARS, sold everything at a ‘distressed asset’ price. Mr King was also forced to take out a £17m mortgage on his properties with First Rand Bank to pay off SARS and relinquish his last £6.8m in his HSBC Guernsey Trust.

Only someone as foolish as Mr King could consider losing everything other than his properties as a favourable result.

He had £120m. He now has £17m in mortgages on his properties. A £137m reverse in Mr King’s fortunes does not bode well for Rangers. Had it not been for the intervention of First Rand Bank, Mr King would have been bankrupt and homeless.

His dividends in MMG are all that is left.

If we turned a blind eye to his criminal convictions, as many have, surely questions remain in regard to his corporate malfeasance and blatant disregard for the tax authorities in the country where he chooses to live. A reverse of £137m is hardly the actions of an honest man with business acumen.

I cannot think of someone less suitable to be the Chairman of Rangers.

Dodgy Dave and The Greg ride again

The chequered history of MMG:SJ (Johannesburg Stock Exchange)  is indicative of the relative fortunes of Mr King and Mr Morris since its inception in 2001.The success of the equity heist in Specialist Outsourcing (which resulted in Mr King pocketing £120m, at the expense of pensioners, a charity for orphans, five of the six major banks and many others) encouraged our two antiheroes to saddle up and ride a new corporate vehicle, Financial Inshore Specialists, which was listed as Insors on the Johannesburg Stock Exchange (JSE). However both ‘jockeys’ were subject to ‘stewards inquiries’  which led to Mr King being removed from the board of the company he co-founded in 2002, and the resignation of Mr Morris in 2003. The stewards in question were the Crown Prosecution Authority of South Africa and one of their inquiries led to the arrest and subsequent trial of King and Morris on racketeering charges.

Financial Inshore Specialists changed its name to Micro Mega Holdings Ltd, and is listed on the JSE as MMG. The absence of the creative entrepreneurial elan of its two co-founders, who were both preoccupied with avoiding 40 year prison sentences, led to a decade of cautionary warnings, low trading volumes and desultory dividends. The 114.9m ordinary shares were listed on the JSE. Dodgy Dave’s portfolio of 16.75m Type A3 Preference Shares was not initially disclosed. So irrespective of how poorly the group was performing and the apparent lack of dividends, the directors could, at their discretion, decide to pay a dividend to Mr King.

There were no dividends paid until 2014 as The Scorpions had secluded Mr King’s holding, via his daughter, of 76% of the ordinary shares and his holding of preference shares. Prior to this Mr King applied unsuccessfully for a stipend from his last £7.8m which was held in an HSBC Trust in Guernsey. Mr King was broke and all his assets were being sold off. He could not pay the mortgages on his properties, which are currently £17m. The £7.8m was eventually released from its Mareva freezing and paid to The South Africa Revenue Service.

The falsifying of quarterly returns, that were a feature at Specialist Outsourcing, led many to speculate that the spectacular increase of 462% in  MMG’s Capital Market Value, in a mere 6 months, was not due to acquisitive or organic growth growth but some old-school financial chicanery.In 2015, Dodgy Dave, now ensconced as Executive Vice Chairman, awarded himself a dividend of £1,066,408 for his preference shares, £511,875 for the ordinary shares held in his daughter’s name and a salary of £215,000.

Mr King borrowed circa £2.5m to buy his shares in Rangers International Football Club plc. He has sufficient funds to pay his gardener and circa £21,812 in annual horticultural charges, but not enough to make an appreciable difference in the fortunes of Rangers.

The unvarnished truth

Today’s surprise announcement by two of the three individuals behind the Rangers Supporters Loyal WordPress account, will inevitably undermine opposition to the underfunded hostile takeover of Rangers. I have been opposed to King since my forays into print on the LSE AIM shares chat page. King’s toxicity as a career white collar criminal resulted in the de-listing of the RIFC equity. No NOMAD was prepared to work with him.

At one time King had £93m, several properties, an aircraft and a Ferrari at his disposal. Interest from his two UK bank accounts amounted to £82,000 per month. He had a very comfortable life. I have spent many hours unravelling how King managed to achieve this considerable amount. Put simply, King ripped off anyone who had the misfortune of believing that he was a man of integrity whom had qualified as an accountant in an as yet unspecified Scottish tertiary education centre.

Prior to meeting Ian Gregory Morris, and the inception of The Johannesburg Stock Exchange (JSE), King’s short-cons were relatively small time. ‘The Greg’ was a fellow Scot who also lied that he was a qualified accountant. He had blagged his way into a position of authority in Umgeni Water. As Financial Director, Mr Morris was entrusted with the pension contributions of all Umgeni employees. He and King then conspired to acquire this sum of money on the pretext of using their alleged skills on the foreign exchange markets and financial derivatives to enhance the position of the pensioners. They were both lying.

Gregory joined King at Specialist Outsourcing when the ink on contract to transfer the Umgeni Reserve Funds was barely dry.They listed their new company on the JSE, pumped the share value with falsified quarterly returns, and then dumped it. Their manipulation of the share price between 1997-1999 was a masterclass in deception. They maintained the front of improbable results and played the asset managers against each other, as they divested themselves of their equity.Specialist Outsourcing share certificates held by the pensioners were not worth the paper they were printed on.

King is noted for being parsimonious and the worst tipper of the valet parking staff at his golf and country club. So there was no surprise when he decided to evade paying capital gains tax on his ill gotten gains. He set up a myriad of trust funds, in the British Virgin Islands, Turks & Caicos, Cayman, Bermuda and Sunshine Islands, that all fed into two trust funds in Guernsey, to evade tax. He thought he was clever. He thought he was Teflon Dave. After a protracted twelve years  of expensive litigation, he faced 328 charges of fraud and racketeering, was arrested and released on bail on two occasions and spent every last penny he could get his hands on to avoid a jail sentence. His 41 convictions in a plea bargain was not a favourable result. The South African Scorpions, aided and abetted by the UK’s Serious Fraud Office, almost cleaned King out. The £93m and toys have all gone. All he has left is his dividends in he and Morris’ latest boiler room scam, MicroMega Holdings group, a modest account at First Rand Bank and a £17m mortgage on his properties.

Despite the reality, King continues to project the myth of his wealth. The supine, corrupt SFA, who need the blue pound in the top tier of football as soon as possible, ignored his 41 transgressions on article 10.1 of their members charter, and incredibly allowed him to appoint himself as Chairman of Rangers. In time everyone will know that King does not engage in any enterprise unless he can profit from it. The 50,000 fans who flock to Ibrox are his latest victims, but they just don’t know it yet. They are oblivious to the fact that he and his shyster board have decimated the value of their shares, that now trade at less than a third of their issue price. If King cannot find an exchange to pump and dump his equity, he will turn his hand to selling Ibrox and The Auchenhowie Sports Academy to developers.

I will put more flesh on the bones, on this, my first WordPress blog, at a later date.