£110m bill for malicious prosecution damages
THE taxpayer faces a bill of more than £110 million for the malicious prosecutions scandal over the failed Rangers fraud case. It comes as it emerged that Duff and Phelps, the company responsible for the administration of Rangers during its financial collapse, is pursuing a £25m compensation claim against Scotland’s most senior law officer over the collapsed case which alleged fraud over the sale of Rangers.
It is the latest twist in an “abuse of power” scandal which has already seen millions of taxpayer-funded damages pay-outs to those wrongly prosecuted by the Crown Office and Police Scotland.
Administrators David Whitehouse and Paul Clark of finance firm Duff and Phelps settled out of court with the Crown Office in December to the tune of more than £24m.
The Crown Office confirmed both men were awarded £10.5m damages, while legal costs will be at least £3m.
Whitehouse, Clark and five others were subjected to detention and criminal proceedings in relation to fraud allegations in the wake of Craig Whyte’s disastrous purchase of Rangers from Sir David Murray for £1 in May 2011 and its subsequent sale before a judge dismissed all charges.
The fraud case arose after the club under Whyte went into administration nine months after he bought it, with debts soaring past £100m and the team ended up relegated to the bottom rung of the Scottish football pyramid.
Now we can reveal that Clark and Whitehouse’s employing company Duff and Phelps is pursuing a compensation claim of £25m from the Lord Advocate James Wolffe over the prosecutions which the authorities have admitted were malicious and without probable cause.
Five of the seven men charged in relation to Rangers fraud cases have been pursuing compensation complaints over wrongful arrest against either Police Scotland, the Crown Office or both with a collective claim now standing at £113m.
One Rangers supporters association source said: “It is an unbelievable turn of events.
“Before we went into administration it was touted that a bill of around £100m including a massive amount owed to the taxman would fall on Rangers.
“We were the villains. Ten years after the club being placed through so much turmoil without reason with the taxman’s huge claim falling apart, the result is that the villains appear to be the Crown Office and the police and instead of the £100m being club debt, the same amount and much more, incredibly, has become the cost to the public purse of this scandal.
“Right now, though, anyone like me who is Rangers through and through is just sitting back and enjoying the fact that we have come from that awful period, consigned to the bottom of the Scottish football heap, to become the champions this season.”
Court of Session judge Lord Tyre has also ruled that there was no “probable cause” to prosecute David Grier, a Duff and Phelps executive, who is also seeking £5m damages from the Lord Advocate and £9m from Police Scotland.
Former Rangers chief executive Charles Green, whose Sevco consortium bought the assets of the club business in liquidation nine years ago is also to receive compensation after Crown lawyers accepted he too was subjected to a malicious fraud prosecution.
A full hearing in his £20m damages claim over wrongful arrest to decide how much should be awarded is due later this year.
He was arrested six years ago for charges connected to the “alleged fraudulent acquisition” of the club in 2012 but the prosecution was later abandoned.
In August last year, it was confirmed former Rangers director Imran Ahmad is to receive a public apology from the head of Scotland’s prosecution service.
Ahmad will also receive significant damages and is pursuing an amount believed to run to £30m, after he was wrongly prosecuted on fraud charges.
He was prosecuted in 2015 over the takeover of the Ibrox club in 2012 but all charges were dropped in 2018. Only two of the seven that were originally charged with offences relating to the alleged Rangers fraud do not have active compensation claims.
Whyte ended up being the last man standing in the fraud conspiracy case and was acquitted of taking over the club by fraud at the end of a seven-week trial.
Gary Withey, the Surrey lawyer with Collyer Bristow who advised Whyte during his ill-fated takeover at Rangers 10 years ago and who saw the conspiracy charge dropped, died two years ago.
Both Withey and Whyte had at the time been accused of deceiving Rangers board members about the takeover.
Seven years ago the BDO, the liquidators of the Rangers Oldco secured a £24m settlement payment from Collyer Bristow after initially launching a professional negligence claim for more than £50m.