Rangers fined 50k for failing to disclose Whyte's chequered past
Rangers have been fined 50,000 by the PLUS Stock Exchange for failing to disclose Craig Whyte's previous disqualification as a director when the businessman completed his takeover of the club in May last year.
Whyte was disqualified in 2000 for seven years but Rangers did not announce this until November 30, six weeks after the Insolvency Service had confirmed the fact in a BBC documentary.
Rangers have been issued with the fine and a public censure following an investigation by the stock exchange, who suspended trading in the club's shares last month because of their failure to publish audited accounts.
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A statement from PLUS read: 'The
amount of the regulatory fine has been determined taking into account a
range of factors including, but not limited to, the seriousness of the
rule breach and the circumstances of Rangers FC.'
PLUS revealed Rangers had sought to
challenge their disciplinary ruling on February 14, the day they went
into administration, but administrators Duff and Phelps withdrew the
referral to the disciplinary committee last week.
Failure to pay a fine within 21 business days would usually mean the possibility of PLUS suspending use of their facilities, while failure to pay for a further seven business days could result in permanent exclusion.
Rangers saw their shares suspended from trading on the stock exchange on January 9 after submitting unaudited accounts.
They released their annual financial figures on November 30, but did not get them signed off by an independent auditor as required by exchange rules.
The club have also failed to hold an AGM within the usual timescale and confirmed in a statement to PLUS that they were considering withdrawing their listing on the exchange in the long term.
Disqualified: Whyte was barred from being a director in 2000
Rangers claimed the delay in finalising
the audit was 'principally' related to an ongoing tax tribunal which,
according to Whyte, could result in a bill of 75million if they lose
the dispute with Her Majesty's Revenue and Customs.
PLUS described Whyte's failure to disclose his previous director
disqualification as 'a particularly serious breach' of their rules for
The statement continued: 'First, disclosure of Mr Whyte's director disqualification was expressly required by the PLUS Rules.
'This is because the information is material to investors and other persons doing business with the issuer.
'Investors and others doing business with the issuer are entitled to
such information to enable them to form a view on the nature and
character of an issuer's administration and management.
'The information relating to Mr Whyte goes to the reputation of Rangers FC's board of directors.
'Mr Whyte's director disqualification may have an effect on the
prospects of Rangers FC as an issuer traded on the PLUS-quoted market as
well as on Rangers FC's ability to raise further funding if required at
a future date.
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'The failure by Rangers FC to disclose this information has generated
adverse publicity for Rangers FC which has harmed its interests.
'Secondly, PLUS is a Recognised Investment Exchange under Part XVIII of
FSMA 2000 and exercises regulatory functions with respect to the
PLUS-quoted market including, but not limited to, the protection of
investors and the maintenance of an orderly disclosure-based market.
'A consequence of non-disclosure by Rangers FC of information required
to be announced by the PLUS Rules is that PLUS was impeded from
exercising its regulatory functions.
'Thirdly, the Regulation Department at PLUS and Rangers FC's PLUS
Corporate Adviser met with officers of Rangers FC, including Mr Whyte on
8 November 2011.
'Before and after this meeting, PLUS and Rangers FC's PLUS Corporate
Adviser had been requesting Rangers FC to make an announcement on a
Regulated Information Service to disclose Mr Whyte's director
'Despite this, no announcement was made by Rangers FC until 30 November.
Chequered past: A Rangers fan raises a banner outside Ibrox
'PLUS considers this delay to be unreasonable, and is evidence of
Rangers FC's deliberate, negligent or reckless attitude to the PLUS
Rules…and Rangers FC's lack of willingness to correct the breach in a
'Fourthly, PLUS takes seriously the failure of Rangers FC to disclose Mr
Whyte's director disqualification to other regulatory bodies, namely
the Panel on Takeovers and Mergers (Takeover Panel) and the Scottish
'Whilst PLUS does not rely on any breaches of regulations other than the
PLUS Rules to reach its decision, the lack of disclosure to other
regulatory bodies further illustrates that the failure to disclose was
deliberate, negligent or reckless and Rangers FC's lack of willingness
to make an announcement in a timely fashion.'
Three days after Rangers went into administration, the SFA confirmed
they would conduct a full independent inquiry into the activities of the
club and investigate whether there have been any potential breaches of
their Articles of Association.
They said attempts to obtain information relating to their 'fit and
proper person' requirement – regarding owner Whyte – were restricted by
the club solicitors' failure to share information.