Questions over £4m ‘missing from Swindon Town directors’ account’
By Tom Seaward
Swindon Town chairman Lee Power is facing questions in the High Court
QUESTIONS have been raised over an alleged £4m missing from the Swindon Town directors’ loan account.
Lawyers for Michael Standing, the football agent who has staked a claim to 50 per cent of the County Ground club, say their client is still owed £3.7m from around £6m he invested.
In papers filed with the High Court, they say the amount outstanding on the directors’ loan account – essentially money they are owed by the club – should be £7.5m rather than the £3.2m shown on club records.
Colin West QC, counsel for Mr Standing in his court fight with Swindon Town chairman Lee Power, suggested in a skeleton argument prepared for the High Court hearing in May that the balance between the two figures had been taken out by Mr Power – and could have been used to buy out debentures held by former club owners.
He wrote: “The question to which this gives rise is: what has happened so as to reduce the amount owed under the Director’s Loan from £7.5m (on [Michael Standing]’s calculation) to the figure where it currently stands of just over £3m?
“The answer to this appears to be that the difference has been drawn out by [Lee Power] and retained by him. This is of course entirely contrary to the terms of the Agreement between the parties, which was that any sums taken out of the Club by means of working capital surpluses from time to time were to be shared on a 50/50 basis with [Michael Standing].
“That therefore amounts to a further sum of approximately £4m, half of which [Lee Power] was bound in equity to account for to [Michael Standing], which he has failed to account for and which remains unaccounted for as things stand.”
Mr Power has said that, if the club is sold to American buyers Able, he will write off the debt owed to him in the directors’ loan account. But if Clem Morfuni’s Axis buys the club he would “require repaying in full on any completion of a sale”.
However, if Mr Standing’s calculations about the amount in the directors’ loan are correct, it could be Mr Power who owes money to his alleged Swindon Town co-owner, the football agent’s lawyers claimed.
Mr West QC suggested that the money his client claims is missing could have been used to buy two debentures – or loans against the club – held by former owners Andrew Black and Sir Martyn Arbib.
“[Mr Power] has never explained where he obtained the money to purchase the debentures,” Mr West QC wrote in his skeleton argument, which the court has now released to the press.
“Throughout 2020 his position was that he was impecunious and would before too long run out of money to keep funding the club. Yet he was nevertheless able to purchase the £3m debentures from their previous owners, Black and Arbib.
“[Mr Power] has never said where he sourced such finance. In the circumstances, the obvious inference is that he used money he had obtained from the club by way of repayments of his director’s loan.”
Rob Angus of STFC Supporters’ Trust said he could not comment on the specific allegations. He said: “The Trust is deeply concerned about the governance of the club and the ongoing uncertainty as to ownership and the club’s financial position.
By Tom Seaward
Swindon Town chairman Lee Power is facing questions in the High Court
QUESTIONS have been raised over an alleged £4m missing from the Swindon Town directors’ loan account.
Lawyers for Michael Standing, the football agent who has staked a claim to 50 per cent of the County Ground club, say their client is still owed £3.7m from around £6m he invested.
In papers filed with the High Court, they say the amount outstanding on the directors’ loan account – essentially money they are owed by the club – should be £7.5m rather than the £3.2m shown on club records.
Colin West QC, counsel for Mr Standing in his court fight with Swindon Town chairman Lee Power, suggested in a skeleton argument prepared for the High Court hearing in May that the balance between the two figures had been taken out by Mr Power – and could have been used to buy out debentures held by former club owners.
He wrote: “The question to which this gives rise is: what has happened so as to reduce the amount owed under the Director’s Loan from £7.5m (on [Michael Standing]’s calculation) to the figure where it currently stands of just over £3m?
“The answer to this appears to be that the difference has been drawn out by [Lee Power] and retained by him. This is of course entirely contrary to the terms of the Agreement between the parties, which was that any sums taken out of the Club by means of working capital surpluses from time to time were to be shared on a 50/50 basis with [Michael Standing].
“That therefore amounts to a further sum of approximately £4m, half of which [Lee Power] was bound in equity to account for to [Michael Standing], which he has failed to account for and which remains unaccounted for as things stand.”
Mr Power has said that, if the club is sold to American buyers Able, he will write off the debt owed to him in the directors’ loan account. But if Clem Morfuni’s Axis buys the club he would “require repaying in full on any completion of a sale”.
However, if Mr Standing’s calculations about the amount in the directors’ loan are correct, it could be Mr Power who owes money to his alleged Swindon Town co-owner, the football agent’s lawyers claimed.
Mr West QC suggested that the money his client claims is missing could have been used to buy two debentures – or loans against the club – held by former owners Andrew Black and Sir Martyn Arbib.
“[Mr Power] has never explained where he obtained the money to purchase the debentures,” Mr West QC wrote in his skeleton argument, which the court has now released to the press.
“Throughout 2020 his position was that he was impecunious and would before too long run out of money to keep funding the club. Yet he was nevertheless able to purchase the £3m debentures from their previous owners, Black and Arbib.
“[Mr Power] has never said where he sourced such finance. In the circumstances, the obvious inference is that he used money he had obtained from the club by way of repayments of his director’s loan.”
Rob Angus of STFC Supporters’ Trust said he could not comment on the specific allegations. He said: “The Trust is deeply concerned about the governance of the club and the ongoing uncertainty as to ownership and the club’s financial position.
And of course, we wish them luck in their quest...