"Firm behind Bradford Bulls owed £1m and had just £750 in the bank" (From Bradford Telegraph and Argus)
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"Firm behind Bradford Bulls owed £1m and had just £750 in the bank"
The firm behind the Bradford Bulls owed more than £1 million and had only £750 in the bank when it went into administration, it has emerged.
And most of those owed money by OK Bulls Ltd are unlikely to get a penny back, including £245,000 belonging to the taxpayer.
The club had a total of £753.17 in its bank account when it went into administration in January, a new report by Leeds-based administrator David Wilson shows. It owed £1.15m, including £168,227 to HM Customs and Excise and £77,221 to the Inland Revenue.
Mr WIlson blames accounting irregularities, a funding reduction, continued trading losses and a lack of capital for the firm’s collapse.
While unsecured creditors are unlikely to see their money again, a £200,000 loan from Bradford Council is guaranteed by former Bulls owner Bradford restaurateur Omar Khan. Mr Wilson’s report says OK Bulls bought the rugby league club for £150,000 and Mr Khan invested a further £400,000 – far less than the £1 million he claims he is owed.
The report says: “Mr Khan has indicated that his claim totals £1,058,920; however an examination of the company records including all bank transactions reveal that £401,658 has been invested by way of cash, against which at the present time repayments of £26,000 have been made.”
Mr Khan resigned in September last year and general manager Ryan Whitcut became director. New directors Mark Moore, Andrew Calvert and Ian Watt joined shortly afterwards.
The report says because of cash-flow problems, Mr Whitcut arranged a short-term loan of £150,000 from Safeguard Security Group (SSG) to pay staff salaries which gave SSG a debenture holding in OK Bulls Ltd.
It says: “It soon became apparent that Mr Whitcut was still in contact with Mr Khan and was approving payments that the other directors were not comfortable with and they felt the club couldn’t afford to make.
“The new directors had also noted accounting irregularities and were not willing to authorise further payments to be made without bringing the accounts up to date.” It says “significant liabilities”, including the SSG loan, had not been revealed to the new directors.
Yesterday, Mr Whitcut released a statement, saying: “I am disappointed at the inaccuracies and false statements contained within parts of the report.”
And Omar Khan’s lawyers said he disputed the assertion he was owed £375,000, and they were writing a “delicate response” to the administrator.
Their statement said: “Omar Khan has asked for a creditors’ meeting, which will be held on April 23, and a number of points will be put to Mr Wilson then.”
The club was taken over by SSG managing director Marc Green last month.
Mr Green had exercised his right as a debenture holder to put OK Bulls into administration in order to prevent the club being liquidated after a winding up order had been received from HMRC.