Chester City’s Administration & Stephen Vaughan
There are some football clubs that seem to be in a perpetual state of flux and crisis. One such club is Chester City where, over the last two decades or so, there has been mismanagement on such a grand scale that one wonders how unlucky a club can be to have run into such problems so regularly. Chester have already been relegated once from the Football League and won promotion back, but they were relegated again last season and it seems unlikely that they will be able to repeat the trick. With the club’s current playing staff reportedly down to single figures and an embargo brought in by the Professional Footballers Association meaning that they cannot sign experienced replacements, their outlook looks bleak. The major question now is exactly how bleak this future will be.
The club went into administration at the end last week, the final chapter in an agonising season during which they were the worst team in the Football League (they were kept from bottom place by Luton Town’s thirty point deduction). There is, however, a wider issue at stake here regarding the Football Association’s rather limp definition of who may be defined as being “fit and proper” to run a football club, since the club’s chairman, Stephen Vaughan, has a little bit of “previous” with regard to the mismanagement of football clubs. Supporters of Barrow AFC (who Chester may or may not – more on this shortly – be playing in the Blue Square Premier next season) may be forgiven for saying “we told you so”.
Vaughan is a boxing promoter from Merseyside, and became involved at Barrow in the mid-1990s. Initially he was successful, and the club won promotion to the Football Conference in 1998, but Vaughan resigned as chairman after an investigation by HMRC into money laundering and his links with the Liverpool gangster and drug trafficker Curtis Warren. He reinstated himself when he was cleared of any involvement (it was said at the time that he had used security provided by Warren at his boxing events and acted as a middle man in his property deals, but drew the line at money laundering), but Barrow were already said to be in serious financial difficulties and Vaughan resigned as chairman and removed his financial backing in November 1998, although he retained his shares in the club.
Barrow were liquidated in January 1999 (a new company, Barrow AFC (1999), was formed in its place) and were demoted back to the Unibond League at the end of that season, but their problems were only just beginning. They almost didn’t start the following season (indeed, they started the 1999/2000 season a month late), but this was a comparatively small problem next to the fact that Vaughan had transferred ownership of the club’s Holker Street stadium into the name of his company, Vaughan Promotions, as repayment for the money that he had poured into the club before this money ran out. The liquidator Jim Duckworth, however, smelled a rat and took him to court over it. In 2002, Holker Street was returned to the liquidators, who sold it back to the new directors of the club for £265,000.
Vaughan turned up at Chester City in 2001, but immediately ran into controversy again when Chester were drawn to play Barrow in the FA Cup Fourth Qualifying Round. Since Vaughan still owned shares in Barrow, the FA threatened to expel both clubs from the competition, but Vaughan sold the shares in Barrow for a nominal sum to Bobby Brown, a painter and decorator, for £1 a couple of days before the match. He bought them back after the match (which Barrow won 1-0) and then sold them to the directors of the new company for £29,500, but his links to the club weren’t fully severed until the court found against him over ownership of the ground. The FA’s handling of the matter was widely criticised at the time, and it is a reflection upon the weakness of the rules regarding club ownership that Vaughan has remained in charge at Chester without censure.
Vaughan’s time at The Deva Stadium hasn’t been without controversy. On the pitch, the Chester were successful again – having been relegated from the Football League in 2000, they were promoted back in 2004 – and Vaughan also oversaw improvements to their facilities. However, in February 2007 he was charged with violent conduct by the FA following an incident in the players tunnel after a match against Shrewsbury Town. In November of that year, the club held a minute’s silence for one Colin Smith, who was announced by the club as “a major benefactor” to them. Afterwards, however, it became clear that Smith was nothing of the sort – rather, he was the right hand man of Curtis Warren, and had been murdered outside a gymnasium in the Speke area of Liverpool in a gangland hit. Vaughan resigned as chairman shortly afterwards, but remains as the club’s owner and a majority shareholder. In January 2008, he was charged with fraud and deception in relation to car finance, and was cleared.
In March 2009 and with Chester sliding out of the Football League again, it was announced that Chester had sold out to Liverpool based property developer Gary Metcalf. Metcalf (whose son, and you may need to read between the lines here, is a Liverpool-based boxer) was all but announced to have bought the controlling stake in the club, but at the start of April Chester supporters established that ownership of the shares had instead passed from Stephen Vaughan into the name of his son, Stephen Vaughan Junior, a twenty-four year old that had played fifty-eight times for Chester. Vaughan Junior had made seventy appearances for Liverpool reserves, but it would be stretching credibility somewhat to suggest that this would give him the means to run the club. Metcalf, who may or may not be linked to the Vaughans, is still said to be interested in the takeover of the club, but this has so far come to nothing. Vaughan Senior is believed to have said that he is owed between two and four million pounds by Chester City.
What, then, does all of this mean for Chester City? Well, the involvement of the administrators could be good news for the club. If the Supporters Trust can lobby them stating that it is in the best interests of all concerned that the club’s ownership is passed to them, they could theoretically take it over. It isn’t, however, that simple. If, as many believe, the transfer of ownership of Chester City into Vaughan Junior’s name was to ensure that Vaughan Senior didn’t get an administration marker against his name when the club were declared insolvent, then it could be more complex than that. Indeed, if Vaughan Senior is the club’s biggest single creditor, then he will hold the ace hand in dealings with the administrator, and he may simply inherit the club again with its debts wiped clean.
Chester supporters’ best hope comes in the form of the authorities. The FA is a broadly different beast to the one that allowed him to run roughshod over their own rules regarding club ownership in 2001, and the Football Conference are notoriously tough over insolvency. They have it within their powers (in a way that not even the administrators do) to shape the destiny of Chester City Football Club. The Football Conference has an agreement with the Football League that it will accept two relegated clubs per season, but they relegated Boston United straight into the Blue Square North and then into the Unibond League because of financial irregularities. Certainly Vaughan Senior’s previous run-ins with the game’s authorities and his associations outside of the game are unlikely to engender much sympathy within those running at the game. At best, Chester will start next season ten points behind everyone else, but things could yet turn out to get much, much worse for them before they get any better.