Unmasking The Power Behind The Throne

WatchedToffee further explores the hidden layers behind the Goodison Park facade.

By @WatchedToffee

All documents and extracts are linked and can be found in the public domain. Simply click on the images to read the original sources.

Philip Green bought Everton for Bill Kenwright “because I liked him.”

My last Everton Viral article was read by almost 25,000 people. It prompted widespread discussion across, Twitter, Facebook and other social media channels. On the Toffeeweb fan site a discussion produced over 500 comments.

I’ve had many national and international journalists making contact, wanting to know why I’m doing what I’m doing.

Some have asked why fans are protesting at a time when Bill Kenwright has brought about stability to a club who were in imminent danger of meltdown on and off the pitch.

Many fans and journalists understand something is wrong at Goodison Park. Either seriously wrong or that things just aren’t what they appear to be.

Other fans and journalists are, or choose to remain, blissfully unaware of the problems being covered up by an increasingly frantic club who spend their time burying bad news by delivering misinformation to an accommodating media.

Of the hundreds of responses triggered on Toffeeweb, one resonates closely with the thrust of this latest article:

“Part of the problem is that there are supporters who appear to advocate that we are in the gutter, how we got here is not relevant, there’s no way out, so settle down and enjoy the view. Utterly shameful.”

I’d say that is very relevant. Twenty years without a trophy, despite over twenty years of Sky money. Numerous failed ground moves, meaning we are left in a 20th century stadium in a 21st century league. And with a team whose average finishing places sees them just scraping into the top ten.

Yes, it is utterly shameful. But how did we get here? How have we been duped into believing mediocrity is acceptable, that finishing sixth is ‘success,’ whilst our peers, who aren’t Portsmouth, Blackburn or Leeds, move forward at an increasingly alarming rate? Where did it all go wrong?

Let’s see….

True Blue Holdings Limited

In 1999 Peter Johnson was coming under increasing pressure to resolve his ownership crisis at Everton. The FA were on his back due to breaking their ownership rules.

Even if the FA turn a blind eye today, back then even they noticed an attempt to resolve his issues of ownership of both Tranmere Rovers and Everton.

Transfering his Tranmere shares in the name of girlfriend Lorraine Rogers, was fooling nobody.

Despite putting £10m into the club during his four year reign the fans were also on Johnson’s back. Poor performances, selling players and being a Liverpool supporter would never endear him to the Goodison faithful. So, in 1999, fellow board member Bill Kenwright seized his opportunity to take over the club.

The story goes that Kenwright, unable to raise all the money himself, formed a consortium from contacts he had in the entertainments industry and fellow Evertonians who had access to money.

Local businessmen such as building magnate Arthur Abercromby, software millionaire Jon Woods, playwright Willy Russell, TV producer Jimmy Mulville and entertainment impresario Paul Gregg and his wife Anita, joined forces to raise the cash and form True Blue Holdings.

The truth is somewhat slightly different.

The Bank of Scotland and the £30m letter

Kenwright’s desperate search for the money to take the club out of the ‘evil’ grasp of Peter Johnson was not dependent on a high and low search for a group of like minded Evertonians. Wealthy supporters who would be prepared to raise the £22m asking price for Johnson’s shareholding in Everton Football Club.

Bill Kenwright had already secured the funding to purchase 72% of Everton from The Bank of Scotland.

The funding had been arranged by fashion billionaire and serial tax avoider Philip Green.

In a 2003 interview in the business section of The Observer, titled ‘The Powerful court of the high street king.’ Green reveals how his success had enabled the building of a powerful and wide reaching network. One that allowed the retail billionaire to become an influential ‘asset’ to others who came to him for advice and opportunities.

Or financial ‘assistance.’

One of those to take advantage of Philip Green’s extensive network was Bill Kenwright. As Green makes perfectly clear in his interview with The Observer’s Sarah Ryle:

“I helped him buy Everton. I wrote a £30m letter for him.” Does he mean he underwrote the theatre impresario’s acquisition of the club in December 1999?

“Yes, that’s right.” Why? “I liked him.”

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The mortgaging of Everton FC shares

Bill Kenwright then set about selling the Everton deal to his friends and acquaintances.

Paul Gregg confirms this to be the case in an interview with The Evertonian magazine: Paul Gregg

“When I called Bill at Christmas I was just very impressed that he had done the deal, achieved a lifetimes ambition and achieved it at a tremendous price given today’s financial climate, that impressed me. I asked him if he had all the money he needed and he answered that he did, I think for old times’ sake he invited me to become involved.”

Was that faux praise of Kenwright’s ability to do a deal a clue to what would happen in the future? Did Paul Gregg know that it was in fact Philip Green who had made Peter Johnson an offer, well below his asking price. One which  given Johnson’s need to relieve himself of his interest in Everton FC, Green knew Johnson could not refuse?

The exact amount Bill Kenwright managed to raise for his share in True Blue Holdings is still being identified. It is a contribution shrouded in mystery.

Kenwright’s claim he mortgaged his house to raise the money fails to accommodate the fact that four years earlier he had already taken out a mortgage on his home. However, it is known he had borrowed an amount of money from Anita Gregg.

What is indisputable is that on completion of the deal, the shares held by the True Blue Holdings consortium were almost immediately mortgaged to a bank. That bank? The Bank of Scotland, the very same bank Philip Green had arranged a £30m facility with.

The mortgage leveraged against the shares in Everton FC was settled in full, four years later, in August 2004. The settlement was signed by Bill Kenwright, just as his dream team was falling apart at the seams. And while the fabulous King’s Dock stadium was slipping through our fingers.

True Blue Holdings

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Despite Kenwright denying to shareholders that Green had a financial stake in the club, famously describing him as “my friend and therefore your friend,” the £30m Bank of Scotland letter would not be the last time Philip Green would arrange a facility to provide money to Everton FC.

The £15m Leafpoint Limited facility

In 2004 Paul Gregg made an oblique takeover bid through a reverse mortgage for the King’s Dock stadium. This deal would have seen the Gregg family eventually own more shares than Bill Kenwright.

Sadly, this offer was declined but the war between the rival directors continued and came to a head over the infamous Fortress Sports Fund (FSF) fiasco, where the highly dubious character Christopher Samuelson, later investigated for money laundering by the FBI, was paraded before an Emergency General Meeting (EGM) as an investor and Evertonian by Bill Kenwright. Before being brought to account by sharp eyed shareholders.

Whilst awaiting the FSF ‘investment,’ one that infamously never materialised, Bill Kenwright announced another £15m facility had been provided by Green.

This facility is worthy of investigation as it provides an insight into the complex finances of Philip Green.

The £15m loan was to be provided by a vehicle named ‘Leafpoint Limited.’ A company incorporated just weeks before the September 2004 EGM. Ostensibly, Leafpoint was just another small company until you notice that one of its directors was a John Paul Readman. Between the 16th of October 2002 and 30th March 2005, Readman was a director of Arcadia Group Limited. The company through which Philip Green controls his fashion and property empire.

Leafpoint Limited

John Readman was also a director of a long list of companies called Propco. These were shell companies set up to hold property title on BHS properties throughout the UK that were bought and mortgaged through the private bank Bayerische Hypo-und Vereinsbank AG.

The rent charged to individual BHS stores wasn’t paid to the various Propco companies, but to a Jersey registered company named Carmen Properties. An off-shore company under the control of a resident of Monaco, and therefore a non-payer of UK tax, Tina Green. Philip Green’s wife.

Another director of the Propco companies, alongside Readman, was accountant Paul Coackley. Another trusted Philip Green lieutenant.

Bizarrely, Paul Coackley was later to supervise a ‘special audit’ at Everton FC. A financial review conducted by Philip Green’s Arcadia Group auditors Price Waterhouse Cooper (PWC). When Everton’s auditors were Deloitte, as they remain to this date.

According to a source inside PWC, Coackley uncovered a £3m shortfall. Mike Cheston, the club’s Head of Finance, an employee for almost fifteen years, was replaced by Martin Evans in December 2006.

Why would Philip Green want his auditors to conduct a special audit on a business he is not listed as having an interest in? And why would the majority shareholders of the club entertain such a request?

The plot thickens when just over eighteen months later Everton’s CEO, Keith Wyness, suddenly resigns citing Philip Green’s involvement and influence behind the scenes.

Wyness has remained silent on the matter ever since Green, and registered Everton director Robert Earl, chased across the Mediterranean in Green’s yacht ‘Lionheart,’ in order to rendezvous with Wyness in Majorca.

Is it wrong that Philip Green offers help to his friend Bill Kenwright? Of course not, I’m certain that we all listen to our friends from time to time, but this appears to be more than a friendship, it appears to be business.

Let’s not forget that former director Paul Gregg has said he was paid for his shares by Philip Green. Shares that are now registered offshore in the British Virgin Islands in a company nobody actually knows anything about.

Except that another loyal Green lieutenant, Robert Earl, claims that the shares are his, while ‘sitting’ on the board of Everton FC doing as much as fellow director Jon Woods – absolutely nothing.

Is it wrong that Philip Green is acting as a shadow director of Everton Football Club and is doing far more than simply giving advice? You bet it is.

It is against Premier League rules and company law. It also suggests that the control by Green could explain the total lack of investment by any director, the total lack of board meetings and the continued search for a stadium solution that requires no investment whatsoever. Philip Green is known as a very hard negotiator and close to untouchable when it comes to spending little and making a massive profit.

Disclosure of the ultimate owner

The Premier League requires, under rule G3, all clubs to disclose the identity of the ultimate owner of anybody holding a significant interest in the club. Rules F7 & F8 are also applicable, the consequences, as can be seen, are draconian.

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Under company law the directors are required to confirm that there is no relevant audit information of which the company’s auditors are unaware. Would the existence of a shadow director, paying for shares, providing finance and conducting special audits count as compliance with this regulation?

Without a ‘shadow’ of doubt Philip Green has introduced practices which have contributed to the all embracing quiescence that surrounds Everton Football Club.

While the continued use by the board of directors of apparent untraceable off shore funding may not be illegal, and the Premier League may prefer to turn a blind eye by conducting little investigation into where or from whom this money actually comes from. The practice is certainly frowned upon by the Government’s Department of Culture, Media & Sport.

I’m hoping that some of the many journalists who have contacted me resist the legal bullying and search out the truth so that my football club can be rid of these interlopers, gain serious investment, progress, develop and challenge to be the best in the land – on and off the field – again.

Read: By @WatchedToffee – Who Is The Main Player In The Everton Show?

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