As well as the evolving local Glasgow scandal of Celtic receiving cheap land deals from a Scottish Labour controlled Glasgow City Council and Greater Glasgow Health Board.
Celtic have been using that land as security to obtain cheap interest rate loans from the Labour riddled Co-operative Bank, most likely through former Chairman John Reid and Director Brian Wilson, both Labour party heavyweights. Now that’s what you call doubling up on corrupt leverage.
The Co-operative Bank, due the drug dealing antics of ex-chairman, ‘Crystal Methodist’ Paul Flowers, a Labour ex-councillor, is soon to experience a forensic examination of it’s ‘policy’ of giving risky loans at low interest rates to Labour party connected entities. In 2006, when the Labour party was close to bankruptcy, the Co-Op Bank bailed the party out and in March this year gave them a loan of £1.2 million at the preferential low rate of 4%. Compare this with Celtic’s Co-op Bank debt facility of £34 million at 1.5%. Celtic’s interest rate is ridiculously low and market loss-making.
Obviously this has implications for UEFA’s FFP and SFA/SPFL, for both competitions, if Celtic has been seen to have been financially advantaged. Any investigation by either footballing body could involve the return of winnings, the cancelling of titles, loss of points and demotion for unfair advantages obtained during the period of the corruption. Celtic’s cheap Co-op Bank debt facility is still operating today.
Celtic’s Loans from the Co-Operative Bank
Iain Dey, Deputy Business Editor of The Times and The Sunday Times wrote the article above in The Sunday Times, in August 2013, detailing Celtic’s Co-operative Bank debt facility of £34 million at 1.5%. One quote from the article says:
Will the Co-op continue to offer generous terms to the likes of Celtic? What about the Labour party, which has been kept afloat over the years through Co-op bank loans.
Here we have the alignment of Celtic and Labour benefiting from the same low loans corruption. Hmmm, a coincidence? Well Celtic’s loans were obtained while John Reid, ex-minister of the Blair Labour govts and Brian Wilson, who was Labour Energy Minister were on the Celtic Board. John Reid was chairman of Celtic from 2007 until 2011. Brian Wilson joined the Celtic board in 2005 where he remains a Director. Note: All of the Co-operative Bank – Celtic mortgages were created during their tenures therefore so were the loans based on those securities.
Celtic’s Co-operative Bank Mortgages
As can be seen above Celtic have four mortgages to the Co-operative Bank acting as security for their £34 million debt facility at an extremely low 1.5% interest. Two involving land obtained cheaply from Glasgow City Council, Westhorn and parts of the Celtic Triangle, and one from the Greater Glasgow Health Board involving Lennoxtown. These have been covered in previous posts:
The Co-operative Bank is Celtic’s banker, as stated in their annual reports. Celtic’s £34 million debt facility at a measly 1.5% interest stands as an indictment of their connection into the low-interest-loans to Labour mates scandal emanating from the Co-op bank.
Treasury Inquiry Announced into Co-operative Bank
UK Chancellor, George Osborne on Friday 22nd November 2013 announced an inquiry into the financial turmoil at the Co-operative Bank.
The probe will be led by an independent person appointed by the City regulators, the Prudential Regulation Authority (PRA) and the Financial Conduct Authority (FCA).
It will also consider whether there was any wrongdoing by individuals, which could lead to fines and censures.
The Co-operative Bank’s lending practices have come under scrutiny due to the £1.5 billion blackhole in it’s finances leading to a financial restructuring which has left it 70% owned by two vulture hedge funds, Silver Point Capital and Aurelius. If the govt does not re-assess Celtic’s financial loss-making debt facility then the hedge funds will certainly do so. Banks always tend to have the right to change loan conditions in their loan agreements.
The Co-op Bank bailed the Labour party out in 2006 when it was close to bankruptcy.
There were also mounting questions about the extraordinary special treatment the bank gave to Labour – extending ‘soft’ loans with preferential rates of interest and admitting that other clients would never be allowed to keep on borrowing so much.
When Labour was on the brink of bankruptcy, then general secretary Peter Watt had a meeting with a senior Co-op executive at which it was agreed that vast debts would not be called in.
What has also come to light are several loans made by the Co-op Bank to the Labour party in March of this year. Loans of £1.2 million were given to the Labour party by both the Co-op Bank and an associated, Unity Trust Bank, at preferential rates of 4%. Ed Balls also received a £50,000 donation last year. Over the past decade the Co-op Bank has loaned Labour £18 million.
If two Labour party loans of £1.5 million at 4% are of interest to the Inquiry then what about a Labour connected £34 million debt facility at 1.5% to John Reid and Brian Wilson’s Celtic? 1.5% is +1% above the base rate of 0.5%:
Robert Downes, policy adviser at the Forum of Private Business, said: ‘Base rate plus 2 to 3 per cent is cheap, really cheap. Most small businesses would love to be getting those kinds of deals in the current climate.
All fair-minded football fans who can now see the potential for corruption of the Celtic-Co-operative Bank loans could be forgiven if they contacted the PRA (Prudential Regulatory Authority), FCA (Financial Conduct Authority) and Treasury, their MP/MSPs [providing they are not Labour] to ask about the unfair advantage given to Celtic by a Labour party run Co-operative Bank.
What the inquiry needs to examine is were the individuals at the Co-operative Bank in Glasgow & Manchester, their HQ, awarding Celtic the low interest debt facility at a below market interest rate? The loan documentation should contain any risk assessment – was it done to market standards?
Celtic’s Debt Facility has to come under UEFA and SFA Scrutiny
UEFA are gradually implementing their Financial Fair Play (FFP) regulations. The Scottish football authorities stand condemned of running a fixed game if they do nothing to erase this cloud of suspicion. Surely Celtic can have been seen to have been financially advantaged by their low interest Co-operative Bank £34 million debt facility at 1.5%. Again fair-minded fans should contact UEFA & the SFA/SPFL to call for inquiries.
Investigations by SFA/SPFL and UEFA need to ensure this sort of advantage is erased for the good of the ‘Beautiful Game’. Potential sanctions could include forcing Celtic to return winnings, the cancelling of titles, loss of points and demotion for the advantages obtained during the period Celtic enjoyed this financial advantage, which still continues today.