Rangers issued a statement on New Years Day announcing the individuals who helped to finance the repayment of Mike Ashley’s £5 million loan by providing loans themselves.
A total of £6.5 million was raised, including funds from three new lenders Rangers director John Bennett, Andrew Ross and Barry Scott, over the past month. Dave King’s New Oasis Asset Limited company, Douglas Park, George Letham and George Taylor were the other investors – Paul Murray and John Gilligan were not named as having provided funds despite King naming Murray previously as one of those who was to provide funds to repay Ashley.
In 2014, Andrew Ross and Barry Scott – who were described as English non-league Workington Reds supporters – bought £50,000 of newly-released shares taking their investment up to £140,000 in the club.
RIFC statement, said: “RIFC’s board is delighted to welcome the new lenders who, as long-standing supporters of the club, fit exactly into the profile of investors that RIFC has encouraged during this ongoing rebuilding phase. The new funding has all been provided on the same basis as other recent loans to RIFC.
“The loans to RIFC were primarily utilised to fund repayment of the Sports Direct facility with the balance going towards the group’s working capital requirements.”
Rangers referred to Hong Kong-based Ross and Scott as long-standing supporters of Rangers and that they ‘fit exactly into the profile of investors that RIFC has encouraged during this ongoing rebuilding phase’.
Who is Andrew Ross?
Ross is the managing director of Hong Kong-based Baker Tilly ‘managing a portfolio of local and international audit clients’. The company website states he has ‘extensive experience auditing publicly listed companies, in corporate structuring and in providing expert opinions on various accounting and auditing issues’.
However, Ross [along with Baker Tilly and former director Helena Kwok]was sanctioned by the US Securities and Exchange Commission [SEC] in December 2014 for their failure to correctly audit the financial statements of a company it charged with fraud in 2012.
According to SEC investigators Ross, Kwok & Baker Tilly ignored ‘red flags’ around a total of 176 related-party transactions detailed in an independent forensic accounting report.
Transactions worth around $59 million were not ‘adequately disclosed in the 2009 year-end financial statements of the company, China North East Petroleum Holdings’.
The SEC claim they failed to devise and adopt appropriate audit responses to the transactions which resulted in the financial statement masking the amount of the transactions.
The investigation ‘found that the audit team had failed to properly obtain the evidence necessary to support its audit report, including conflicting information about the source of a $4.6m capital contribution to one of the company’s subsidiaries’.
In conclusion, the SEC ruled that ‘the audit report issued by Baker Tilly Hong Kong contained unqualified opinions of China North East Petroleum’s financial statements’.
The firm settled the charges imposed by the SEC and had to pay $75,000 in audit fees as well as a prejudgment interest payment of $9,101. Baker Tilly was also banned from accepting any new US audit clients until an independent consultant had reviewed and confirmed their audit policies are compliant with both SEC regulation and PCAOB standards.
Both Kwok and Ross also agreed to settle with the SEC and were ordered to pay fines of $10,000 and $20,000 respectively. The duo were banned from practicing as accountants ‘on behalf of any SEC-governed entity for a minimum of three years’.
SEC division of enforcement associate director Antonia Chion, at the time of the settlement announcement, said: “Auditors play a critical gatekeeper role in our financial markets, and Baker Tilly failed to uphold US auditing standards and exercise appropriate professional care and skepticism with regard to numerous related-party transactions.”
Clear professional negligence from Mr Ross – Here is the SEC’s statement in full: http://www.sec.gov/news/pressrelease/2014-284.html
An apology to Barry Scott
On New Year’s Day night I published this article with information about a Barry Scott, claiming that he was the former director of an Aberdeen-based company called Barum House Securities that had misappropriated client funds for his own personal overdraft among other dodgy business practices.
After spending some time today looking at further information sent to me it is clear that I highlighted the wrong Barry Scott.
The Barry Scott who loaned money to Rangers Football Club was not the same Scott who fled the UK in the early noughties and has not been banned by the FSA for life.
I have sent a personal apology direct to Mr Scott through one of his social media accounts highlighting my error.
Once again I would like to apologise unreservedly to Mr Scott and hope that I have not caused him any problems in a personal or professional capacity.
I have removed the said section of this article I wrote about the ‘Barry Scott’ and I wish Mr Scott and his family well for the year 2016.