An Open Letter to HMRC Regarding Wrexham FC

A Circus Side Show

Her Majesty’s Revenue & Customs is owed money by Wrexham Football Club, and it seems understandable that the tax authority is unwilling to demand anything less than payment in full. Supporters of Wales’s oldest football club have watched a proud institution reduced to a circus side show by owners who appear to have utilised its assets to support their other business interests. While performances on the pitch have improved, the situation off it has become a shambles, created by the very people supposed to be guiding the club with integrity.

Wrexham FC, which plays at the world’s oldest international stadium, The Racecourse, is owned by a holding company, Wrexham Village Ltd. The majority shareholders of this company are Geoff Moss and Ian Roberts, who also serve as the directors of the football club itself. It is under their stewardship that the club has found itself in its current predicament, facing a winding-up petition from HMRC while its directors, both described as multi-millionaires, shake a begging bowl around North Wales, attempting to deflect responsibility for paying their own debts.

The Crusaders Connection

To understand the present, one has to look at a curious case of corporate overlap. In December 2009, Wrexham Village acquired Celtic Crusaders, a rugby league franchise. The Crusaders were moved north to play their matches at The Racecourse, with the same gentlemen, Moss and Roberts, directing their affairs. The rugby league club was owned within the same structure as the football club. At the time, it was suggested that the Crusaders would pay a contribution to Wrexham for the use of its facilities.

By November 2010, the Crusaders had entered administration, with their financial difficulties blamed on hidden debts present at the time of acquisition. The administrators’ report stated that HMRC was owed £445,000 by the Crusaders, a sum presumably lost to the revenue. The Rugby League was owed £701,000. In January, the Crusaders were bought out of administration by new owners: Messrs Moss and Roberts. This time, however, the club would be owned outside the Wrexham Village structure. In a side deal, the new owners agreed to repay the money owed to the Rugby League, with the debt secured on the assets of Wrexham FC (2006). It is difficult to see any benefit in this transaction for the football club.

Pissing In The Same Pot

The relationship between the two clubs raises serious questions about fiduciary duty. The administrators’ report for the Crusaders noted “an informal agreement in place in respect of the company’s occupation” of The Racecourse. When asked at a fans forum in January 2010 how much the Crusaders were paying for using the stadium, Ian Roberts stated:

We are all ****ing in the same pot.

This is a proposition that is, to put it mildly, difficult to quantify. Wrexham FC (2006) did not appear on the Crusaders’ list of creditors, which is odd given that non-payment of rent is often a trigger for administration. During the administration period itself, no rent was paid to the football club. The reasonable assumption must be that the Crusaders were not paying a market rent for the use of a professional stadium, a sum which for many clubs is no less than £250,000 per annum. This is a huge amount of income for any business to simply write off.

It could be argued that the directors of Wrexham FC (2006) were in breach of their duties to creditors, employees and shareholders by failing to charge a fair market rent. Full disclosure of the relationship between the two clubs could put this matter to rest, but the latest accounts for Wrexham FC (2006), Celtic Crusaders, and Wrexham Village have not been filed for the period under review. The directors of Wrexham FC (2006) now claim to have loaned a sum of £1.8m to the club. One might wonder why directors would loan money from their own pockets while simultaneously passing up legitimate income opportunities elsewhere. Wakefield Trinity, another rugby league club, has also recently faced insolvency issues.

Since exiting administration, the Crusaders have announced a new deal has been agreed for the use of the football club’s facilities. Supporters, meanwhile, are being blackmailed with a “your club will die” narrative if they do not cough up to clear the mess. They are desperate to see their club succeed and trade with integrity. It is hoped that shining a light on these activities will help HMRC recoup the monies it is owed, and perhaps bring some accountability to the affairs of a club held so dear by so many.