What did Ogilvie know?

Our aim here in asking the question what did Ogilvie know about EBTs is not to try and prove either way if EBT’s, either the initial DOS or later BTC (Big Tax Case) EBTs were setup to gain an unsporting advantage. All we want to do is provide information about the background to EBTs and Campbell Ogilvie’s known role in them using layman terms as far as is possible.

In this piece we set out the information we have and the questions we feel that Mr Ogilvie should be answering. Whilst reading this please remember the Honesty, Transparency & Accountability post that we published and ask yourself, Should this man be the President of the body running Scottish Football?

Things we do know

  1. He set up first Rangers venture into questionable tax schemes on 3 Sept 1999 (Discount Option Scheme) for “a valuable Rangers employee” when he subscribed to two £1 share premiums in Montreal Limited at a subscription price of £2 and a share premium of £149,998.
  2. He attended a meeting as General Secretary of Rangers on 16 September to discuss remuneration planning of Rangers employees at which it was confirmed Craig Moore was to be offered beneficial ownership of the Company’s shareholding in Montreal Limited as a constituent part of the remuneration package to Craig Moore.
  3. He knew that Craig Moore was the valued employee at para 1 & from para 2 what the Discount Option Scheme consisted of and that it was now part of Rangers employee remuneration planning.
  4. He was employed by Rangers, in various capacities until around September 2005 and was there at the time in March/April 2005 when HMRC had made enquiries about side letters re Flo and De Boer.
  5. He was a beneficiary of a payment of £95,000 from MGMRT (Employee Benefit Trust) but claimed no knowledge of details of it.
  6. He denied any role in administering player contracts (see [1]) and assumed all contributions to the trust were being made legally and relevant football regulations were being complied with. (In spite of para 1 to para 3 and implications from para 4)
  7. He gave testimony to Lord Nimmo Smith in the enquiry into player registration and non-reporting of EBT side letters.
  8. He did not provide any testimony or clarification to LNS on players named in the Commission List who were in receipt of trust payments (See [2])  with side letters withheld that were paid via the DOS in spite of his knowledge at 1 to 3 and possible knowledge of their illegality stemming from 4 or subsequent public knowledge of the existence of the by then unpaid tax bill resulting from the DOS based Trust.
  9. Whilst his role in introducing ebts justified the SFA excusing itself as the commissioning authority, it also meant the SPL and their solicitors were unsighted on paras 1, 2 and 3 during their commissioning of LNS (whilst the SFA subsequently still provided key influencing testimony during the enquiry itself.  An alternative to the SFA was The Court Of Arbitration on Sport or even an independent Appeal body could have been set up to carry out the Appellant Role in order for the LNS Commission to be fully informed.
  10. He did not correct or comment on LNS’s decision to treat the early DOS Trust and EBT Trusts as continuous in spite of being the creator of the scheme he was instrumental in establishing in Sept 1999. (see 1 to 3).  Nor comment on his presence at Rangers when they switched from the DOS arrangement (to be accepted as irregular in 2011) to the loan MGMRT arrangement subject to UTT appeal. 
  11. He did not comment on or correct the LNS decision arising as a result of the continuous decision at 10 that said “Although the payments in this case were not themselves irregular and were not in breach of SPL or SFA Rules, the scale and extent of the proven contraventions of the disclosure rules require a substantial penalty to be imposed;” This calls into question Lord Nimmo Smith’s overall ruling, which is based on all payments being regular (“not themselves irregular”) when at least two were not regular and also the appropriateness of the penalty imposed and possibly even more fundamental aspects of the LNS commissioning itself.

Questions for Campbell Ogilvie

Employee Remuneration Policy

Campbell Ogilvie sat as Secretary to the committee in 1999 that decided to adopt employee benefit trusts as a matter of Rangers employee remuneration policy:

  • Were you aware from prior briefings what might invalidate the use of EBT’s as a means of remunerating employers, particularly players?
  • If not, did you seek clarification? and if not why not?
  • With your experience in football administration did you advise others at Rangers in your role as Secretary of what might invalidate the protection from tax that EBT’s offered?
  • If it was not your responsibility to brief others, whose was it and was it agreed that a briefing should be provided to contract writers?
  • If not, given the disastrous consequences of not complying, why not?

You said in 2012

“It is also worth noting that, since the mid-90s, I was not responsible for the drafting or administering of player contracts.

  • Given that you set up the first EBT payment under the above policy in 1999 does that not suggest that you played a part in the administration of a contract to pay a player?
  • What was the reason for the payment in question to Craig Moore and was the payment registered with the SFA as part of the player’s contract?
  • Given that the signings in 2000 of De Boer and Flo were the first time EBT’s were used in the recruitment of new players under the policy you were party to introducing, were you not involved at any stage administrative or advisory or any other capacity?
  • Had you at any time between 2000 and 2005 in your role as Secretary or any other role received any indication that HMRC were asking question s about the contracts to these players awarded in 2000?
  • Given that the side letters for these two existed, at what point did you become aware of their existence?
  • Given the potential consequences arising from their existence being hidden from HMRC did you advise anyone at Rangers in 2005 or at the SFA at any time after you joined them on those potential consequences?
  • If not why not, if yes whom did you advise?

Lord Nimmo Smith Enquiry.

You stated

“In relation to the recent investigation, I can confirm that I asked to be excluded from the Scottish FA’s independent inquiry into Rangers.

“In the interests of good governance it was absolutely right that this was the case.”

  • What was the basis for deciding it was in the interests of good governance given your knowledge of the introduction of EBT’s at Rangers?
  • Was it your decision alone or did you discuss it with anyone?
  • If yes with whom?
  • Did you reveal then your early involvement from 1999 in EBT’s, in particular your role in the remuneration policy committee?

In 2012 you said

“I was aware of the EBT scheme in operation at Rangers during my time at the club and, indeed, was a member. The existence of the scheme was published in Rangers’ annual accounts.

  • Why did you not clarify that there were in fact two distinct EBT schemes in operation during your time at Rangers, the one that paid you £95K and the one that paid Moore, De Boer and Flo?
  • Why, given that the SFA took on role of appellants but you had excluded yourself from an SFA enquiry did you then not exclude yourself from the SPL independent enquiry under LNS in the same interests of good governance grounds?
  • Why when giving testimony to LNS during that enquiry did you not make a distinction between the early EBT’s arising from the DOS and the later EBTs as LNS was treating them as continuous when in tax avoidance and tax evasion terms they clearly were not at the time of enquiry?
  • Are you aware that failure to make the distinction caused LNS to treat all payments as “not themselves irregular” when in fact at least the two to De Boer and Flo were?

http://www.dailymail.co.uk/sport/football/article-2116686/Rangers-crisis-Campbell-Ogilvie-received-95k-EBT-cash.html

Comment – Given that side letters were hidden in the De Boer and Flo cases for sure and both related to payments under the irregular Discount Option Scheme and that Campbell Ogilvie was aware of the distinction between DOS and loan EBTs from his experience in 1999, did he tell the full story in his statements then and does he not now have a responsibility to explain:

  • The absence of any reference to the distinction that may have informed both the SPL when commissioning and LNS when ruling on side letters unsighted as they were of documentation D&P failed to supply for which they were found guilty by LNS?
  • Whether the DOS payment to Craig Moore was reported to the SFA as part of Moore’s remuneration package and if the matter of side letters and reporting them was discussed during any remuneration planning meetings he presumably attended as Company Secretary?

Rangers said no side letters could be found in players personal files casting doubts on the full veracity of Sir David Murray’s statement on 6 Aug 2012 following Hugh Adams accusations of prior use of trusts to avoid tax when SDM said:

“All football rules were complied with. All enquiries from entitled parties or organisations were answered.” http://www.bbc.co.uk/sport/0/football/19300338

Comment – Answered yes, but truthfully no.

Notes

[1]http://www.telegraph.co.uk/sport/football/teams/rangers/9144140/Campbell-Ogilvie-admits-he-was-aware-of-Rangers-EBT-scheme-but-had-no-role-in-player-contracts.html

[2]

Defintion of “EBT Payments and Arrangements”.  This expression is given the following definition: “Payments made by or for Rangers PLC into an employee benefit trust or trusts for the benefit of Players, including the Specified Players, employed by Rangers PLC as Professional Players, Registered and/or to be Registered as Professional Players with the Scottish Premier League and Playing and/or to Play for Rangers FC in the Scottish Premier League and payments made by or for Rangers PLC into a sub-trust or sub-trusts of such trust or trusts of which such Players were beneficiaries, payments by such trust or trusts and/or sub-trust or sub-trusts to such Players and/or for the benefit of such Players and any and all arrangements, agreements and/or undertakings and the like or similar relating to or concerning any of such Players and payments.”

Comment – The above does not limit Trusts to the loan based Employee Benefit Trusts which are the basis of the big tax case under review by the UTT, but covers all payments made via a Trust to benefit players.