Market Abuse due to Child Abuse: Celtic Directors broke the AIM Listing rules on Disclosure on Secret Abuse Investigation.
Peter Lawwell announced on 1 June 2019 that for 2 years the Celtic Board had a third party a “wholly independent and experienced lawyer” investigate what were their possible liabilities regarding the numerous (ring) of paedophiles that occupied the nexus between Celtic FC and Celtic Boys Club.
Now Mr Lawwell, how long have you been a director? You know as a director of a public listed company that you have a mandatory obligation to keep the market apprised of any possible information that is price sensitive to your shareholders. A two year ‘secret’ investigation is not on for you and your board.
The disclosure requirements were part of your company’s listing requirements. Celtic PLC ( Code: CCP which confidentiality is the same as the abbreviation as the Chinese Communist Party) is on the AIM (Alternative Investment Market) which is a sub-market of London Stock Exchange. Which requires that the company agrees to keeping the market fully informed.
AIM Disclosure Requirements
Price Sensitive Information
Now most competent directors of a company would know that a two year ‘secret’ project assessing liabilities for cover-up of paedophile activities would be price sensitive on their shares. But such is the cover-up mentality (which has gotten them in the hole in the first place) at Celtic board level that not one director appears to have spoke up about this and pointed out to the rest of the directors that this was wrong. Protecting the good name again.
If those directors claim, and I don’t take anything off the table for Celtic to try and get out of this problem, they knew nothing about this ‘secret’ project then they have a major corporate dis-functional problem which needs resolving.
Don’t think Peter Lawwell can claim only he knew, else he has to resign for keeping it from the board. Celtic have painted themselves into a corner with this deception.
Would Celtic have been covered by Insurance for Civil Claims by Victims?
I’m sure the independent lawyer gave estimates of liabilities, was it the same ‘independent’ lawyers used by the SFA/SPFL when investigating Rangers, ‘impartially’ of course? ‘Who pays the piper calls the tune’ comes to mind.
In their estimation of the risk (likelihood) and potential impact (amount of damages) of numerous civil actions the lawyer would have taken into consideration any insurance that Celtic had in place. However it is likely more victims than were involved in the criminal cases will also joins any damages claim so how can a lawyer estimate the total likely settlement given the long period under consideration and long term suppression by the victims.
One path perhaps taken by victims lawyers is to claim Vicarious Liability. Abuse lawyer, Dino Nocivelli below explains this which may impact the damages claimed against Celtic’s involvement with the Celtic Boys Club.
However it’s very possible that Celtic’s liability insurance may not cover all their potential liabilities especially as it appears that Celtic covered up acts by paedophiles in the attempt to preserve their good name and even, in Torbett’s case appear to have facilitated his re-employment at the Boys Club. Celtic management had chances to protect children but they did not thus resulting in more child abuse.
Note: Kevin Kelly, Celtic chairman’s denial of having a business relationship with Jim Torbett (in his return to Celtic/Boys Club after being kicked out) with Mr Kelly’s directorship at Torbett’s company, The Trophy Centre, with Jack McGinn, another Celtic director, falls down when Mr Kelly, filling in the paperwork to become a SFA Board Director, stated to Companies House that he was a ‘Company Director Personalised Gifts’ instead of just a Company Director maybe of Celtic:
AIM Notified of the Two year Secret Investigation
So Celtic had an obligation to inform shareholders and the market that this assessment was happening for 2 years and they did not. How the AIM market treats Celtic is unknown. But the AIM definitely know about the two year secret investigation because a vigilant market watcher has notified the AIM of a possible breach by Celtic PLC of their disclosure requirements:
Two Years of False Annual Accounts and Auditor Deception
Any contingency has to appear in the accounts too. I’m afraid ‘secret’ does not give you a free pass Mr Lawwell. Has any contingencies been defined in the last two annual accounts? That’s a definite no. As a CPA, and a former Financial Director of Celtic in the years 1990-91 then Mr Lawwell cannot evade those responsibilities.
So the Auditors that signed off on those accounts were deceived. Auditors sign a company’s accounts verifying that they are ‘a true and fair view’ of the company. If something is kept from them i.e. secret, then what they endorsed and put their name to is not a true and fair view.
Coincidentally, Celtic accounting period ends today, 30 June 2019, so will they announce anything in their current report about contingencies for potential liabilities? Or are they going for the treble?
The FCA (Financial Conduct Authority) in 2017 forced Tesco to pay compensation to investors that purchased their shares because Tesco committed market abuse, defined as an accounting error which gave a ‘misleading impression’ about the value of its publicly traded shares.
FCA can use its powers under section 384 of the Financial Services and Markets Act to require a listed company to pay compensation for market abuse:
Tesco had published an expected trading profit then later published a further trading update in which it announced that it had “identified an overstatement of its expected profit.”
Because Tesco accepted responsibility for false accounting and agreed to pay compensation to investors who purchased Tesco shares and bonds the FCA did not impose any additional sanction on them for market abuse.
Tesco had to enter into a deferred prosecution agreement (‘DPA’) with the Serious Fraud Office (‘SFO’) relating to false accounting and had to pay a fine of £128 million. Who knows how the FCA would treat the Celtic case of false accounting however, unlike Tesco, the Celtic board have known for 2 years that a secret investigation was taking place.
How many investors have purchased Celtic shares in the last 2+ years and who might suffer losses when the likely damages are reached via settlements of civil actions or otherwise?
Good Name of ECA board, UEFA Committees being tarnished
Is it right and proper that Peter Lawwell has continuing involvement as a director on board of the European Club Association, and as a member of the Club Competitions Committee at UEFA and the Professional Football Strategy Council of UEFA when he has overseen a 2 year secret investigation into Celtic’s handling of child football abuse cases at Celtic Boys Club over 30-40 years?
Although he represents himself and Celtic, not Scotland, it does does reflect badly on Scottish football’s reputation if this festers on without resolution.
Will the ECA and UEFA, like Celtic and SFA/SPFL cabal continue to squander what is left of their reputations remaining in order to ‘protect their good names’ which got them where they are now by sitting on their hands?