Wrexham have been extremely fortunate that previous and prospective custodians of our club, have been people of exemplary character. They’re the sort of people you would exclaim to; ‘Yes!, I will buy that second-car with the weld mark round the middle from you, and while I’m at it, do you do Payment Protection Insurance?” Many clubs have not been as fortunate as us, and it is worth considering reasons why an individual would want to invest in a football club. All of these reasons are well documented, so you would wonder why the football authorities haven’t wised up. The reasons are all about personal gain, rather than a love of football.
Reason 1 – Tax purposes
People pay tax on income or profits. If you don’t make a profit you don’t pay tax. If you own a loss making Football Club it seems to be possible to offset these losses against profits made elsewhere to avoid tax. It is possible to give money to football clubs as a conditional gift. That is, you can state it is a gift, but later convert it to a loan. This has three great benefits; firstly you can’t pay tax on money you’ve given away, secondly if the club gets in a mess you can convert your gift to a loan and demand your money back (unlike buying shares in the Football Club) and finally the fans think your fantastic in providing money to the club.
Reason 2 – Money laundering
All businesses that deal in cash are vulnerable to use for this purpose. Football Clubs takes lots of cash, and once it hits the Club’s bank account its source is untraceable. It is alleged that money launderers are willing to take huge losses on the face value of cash in order to legitimise its source.
Reason 3 – Control of Results
To influence the result of matches for financial gain is taking a massive risk, much less risky is to influence something within a game (times of throw-ins for example). Betting is global, and a recent investigation linked far eastern gambling syndicates with attempts to influence reserve team games in England. The global nature of betting makes looking for suspicious betting patterns difficult and if a bet is placed in one country there is no guarantee of support in investigations from the Country where the irregularity has occurred.
Reason 4- Asset Stripping
When Alex Hamilton owned WFC he accidentally transferred the lease on the ground (a very valuable asset) to another company he owned. Luckily he realised his error, and we all lived happily ever after. Hereford United have a current lease issue, with the new owner enquiring about the transfer of leases. Towns have often grown around football clubs, leaving them on prime building land, sadly this is very tempting to developers.
Reason 5 – Ego massaging
Warren Buffett and I have a lot in common. That’s a lie: we have one thing in common. He gives vast sums of money to a charitable foundation started by Bill Gates. I give a tiny amount to Wrexham Supporters Trust. Our similarity is that we get no publicity in return, and have no direct control over the spending of our donations. You have to assume we do it because we want the organisations to succeed, and not for any adulation we might receive from the grateful. It has been alleged that there was a group of ‘high net worth’ individuals who wanted to invest in Wrexham, in return for boardroom influence. I don’t for a moment suspect any wickedness was intended by these individuals, but their benevolence doesn’t match me and Warren. I think if Don Bircham, Spencer Harris, Barry Horne et al were honest they would say they get a buzz out of running the club. That ‘buzz’ seems to be worth a lot to them, as they donate their time for free.
My incentive to invest in Wrexham FC is because I love watching Wrexham FC play. Problems occur with club ownership when the incentive of the owners is one, or all of the above.