Al Jazeera Bombshell about Reading FC?

[Snowflake Royal]

I may be getting it wrong, confused as to who joined when, with Anton, Thais, now the Chinese.

But weren't the high wage signings pre-Chinese days? Aluko, Baldock, Moore et al which they inherited?

And also actually hasn't the Chinese investment generally been pretty good i.e. the likes of Ejaria, Puscas, Joao which lead to us missing out on playoffs last year (and in my opinion had we had a better manager would have done it)?

I quite like them.

No. Dai Yongge bought the club in May 17, end of Stam's first season. Gourlay arrived the same time.

So Aluko, Baldock, not selling Moore and giving him a PL wage for years... all under Yongge's watch

Joao, Puscas and Ejaria all his and all arguably unaffordable given our position.

Ok fair enough it was all getting hazy to me, thanks for clearing it up.

Again I can't blame them for splashing the cash hoping we do well. It almost worked last season.

Where I can blame them is splashing the cash on players but then not getting in proven managers who can do something with them.

Still overall for the excitement factor I can't knock owners for at least giving it a go.

OK, so you're fine with financial doping your way to success providing it works.

Colour me surprised Mr Where's the Money gone?

[Snowflake Royal]

I’ve not had much formal involvement in money laundering, but my very basic understanding is that for it to be successful you put ‘dirty’ money into a business and then extract ‘clean’ money.
From what I can work out the Russians put some money into the club (or rather into SJM’s coffers) but I can’t quite see where they took money out. They spent borrowed money and left the club to repay it but did they actually ‘launder’ anything ?
My belief at the time was Anton was a spoilt rich kid being indulged by a rich parent rather than there was obvious criminality going on. The involvement of Papa Zingarevich was known and the fact that the money was his was known.

Associates' agent fees and handling for signings
Those dodgy loans to Vibrac which iirc was associated with Samuelson and charged ludicrous interest
Paying yourself a salary
Getting the value of your shares back when you sell - though SJM may have out maneuvered them there. It got complicated.

[Nameless]

No. Dai Yongge bought the club in May 17, end of Stam's first season. Gourlay arrived the same time.

So Aluko, Baldock, not selling Moore and giving him a PL wage for years... all under Yongge's watch

Joao, Puscas and Ejaria all his and all arguably unaffordable given our position.

Ok fair enough it was all getting hazy to me, thanks for clearing it up.

Again I can't blame them for splashing the cash hoping we do well. It almost worked last season.

Where I can blame them is splashing the cash on players but then not getting in proven managers who can do something with them.

Still overall for the excitement factor I can't knock owners for at least giving it a go.

OK, so you're fine with financial doping your way to success providing it works.

Colour me surprised Mr Where's the Money gone?

‘Financial doping’ LOL.

[Nameless]

I’ve not had much formal involvement in money laundering, but my very basic understanding is that for it to be successful you put ‘dirty’ money into a business and then extract ‘clean’ money.
From what I can work out the Russians put some money into the club (or rather into SJM’s coffers) but I can’t quite see where they took money out. They spent borrowed money and left the club to repay it but did they actually ‘launder’ anything ?
My belief at the time was Anton was a spoilt rich kid being indulged by a rich parent rather than there was obvious criminality going on. The involvement of Papa Zingarevich was known and the fact that the money was his was known.

Associates' agent fees and handling for signings
Those dodgy loans to Vibrac which iirc was associated with Samuelson and charged ludicrous interest
Paying yourself a salary
Getting the value of your shares back when you sell - though SJM may have out maneuvered them there. It got complicated.

Seems very paltry returns for a billionaire, why would you bother ?
Did they get their money back ? My recollection was they defaulted on the second payment and the shares reverted to SJM.

[Snowflake Royal]

I’ve not had much formal involvement in money laundering, but my very basic understanding is that for it to be successful you put ‘dirty’ money into a business and then extract ‘clean’ money.
From what I can work out the Russians put some money into the club (or rather into SJM’s coffers) but I can’t quite see where they took money out. They spent borrowed money and left the club to repay it but did they actually ‘launder’ anything ?
My belief at the time was Anton was a spoilt rich kid being indulged by a rich parent rather than there was obvious criminality going on. The involvement of Papa Zingarevich was known and the fact that the money was his was known.

Associates' agent fees and handling for signings
Those dodgy loans to Vibrac which iirc was associated with Samuelson and charged ludicrous interest
Paying yourself a salary
Getting the value of your shares back when you sell - though SJM may have out maneuvered them there. It got complicated.

Seems very paltry returns for a billionaire, why would you bother ?
Did they get their money back ? My recollection was they defaulted on the second payment and the shares reverted to SJM.

Someone once made a similar point to me about cheating expenses. Why would she do it, she's got plenty of money.

Because she wants more. And because taking a little from a lot of places makes getting it easier.

[Nameless]

Associates' agent fees and handling for signings
Those dodgy loans to Vibrac which iirc was associated with Samuelson and charged ludicrous interest
Paying yourself a salary
Getting the value of your shares back when you sell - though SJM may have out maneuvered them there. It got complicated.

Seems very paltry returns for a billionaire, why would you bother ?
Did they get their money back ? My recollection was they defaulted on the second payment and the shares reverted to SJM.

Someone once made a similar point to me about cheating expenses. Why would she do it, she's got plenty of money.

Because she wants more. And because taking a little from a lot of places makes getting it easier.

Cheating on expenses doesn’t require you to put millions up in advance though.
The spoilt rich kid theory makes much more sense, especially with the inability to,produce the second tranche. The explanation at the time was Papa had funded the first half on the provisio Anton proved himself by finding other investors to back the second . When he failed Papa pulled the plug.....

[muirinho]

Seems very paltry returns for a billionaire, why would you bother ?
Did they get their money back ? My recollection was they defaulted on the second payment and the shares reverted to SJM.

Someone once made a similar point to me about cheating expenses. Why would she do it, she's got plenty of money.

Because she wants more. And because taking a little from a lot of places makes getting it easier.

Cheating on expenses doesn’t require you to put millions up in advance though.
The spoilt rich kid theory makes much more sense, especially with the inability to,produce the second tranche. The explanation at the time was Papa had funded the first half on the provisio Anton proved himself by finding other investors to back the second . When he failed Papa pulled the plug.....

I suppose the theory would be you put in 30 million of rotten money - if you get back 1 million of clean money, you're up 1 million. Isn't betting a way of laundering money too - you lose loads, but what you win back is "safe"

Second possibility is that AZ was setting up the club with a seed investment, as a vehicle for laundering money (the other investors), but something went wrong, and the dirty money never arrived.

If that means what he lost was actually clean money, that's pretty funny.

[Millsy]

The owners are also responsible for appointing 3 managers in a row with zero track record of management at our level.

I mean, we can of course praise the owners for investing so much of their own money into the club; as well as keeping ticket prices low and generally acting pretty well towards the fans. But there's no question that they deserve criticism for the shear inefficiency and ineffectiveness of their management of the club. We are in the situation we are now because of them.

The EFL is an absolute crazy league that encourages a 'promotion or bust' mentality whilst also punishing those clubs that do 'bust'. But we do have choices about the sort of club we want to be. I'd rather be a Champ side skirting with relegation each season than one that spends 200% of it's income on player wages.

Good post.

No point pumping money into players but cheaping out on managers.

I have no problem with giving the likes of Pauno a go - he may well come really good one day and has certainly shown the potential is possibly there, but generally even good new managers need some time to settle in. When we're desperate to get results in a do or die season in a high risk strategy you want someone proven and safe, not someone who might come good one day.

We've blown it now.

What sort of idiot gives the manager’s job to complete novices ! I mean the likes of McGhee, Pardew and McDermott had zero games as managers in the league when we risked them... Clarke, Bowen, Clement all had tonnes of top notch football experience. I don’t think there is a magic formula for appointing a manager, even the great Sir Steve Coppell has some serious negatives on his CV.....

Yeah I've argued that before about McGhee, Pardew, McDermott when noobs joined but in fairness each one of them was with us for a while, knew the players and club inside out etc they weren't totally new to champ football, the country and the club. As for Coppell his record was good enough for me to argue endlessly here before he joined that he'd be a success. You're right you can't really tell, but I'd have thought you're splashing millions on players for one major do or die push you might go for tried and tested managers than keep chancing on nobodies. I can only assume that's cheaping out, which doesn't make sense to me when spending so much on players. Of course it's very easy for me to say this after the cockup last season but in fairness it's easy with hindsight to make any case.

[SCIAG]

I’ve not had much formal involvement in money laundering, but my very basic understanding is that for it to be successful you put ‘dirty’ money into a business and then extract ‘clean’ money.
From what I can work out the Russians put some money into the club (or rather into SJM’s coffers) but I can’t quite see where they took money out. They spent borrowed money and left the club to repay it but did they actually ‘launder’ anything ?
My belief at the time was Anton was a spoilt rich kid being indulged by a rich parent rather than there was obvious criminality going on. The involvement of Papa Zingarevich was known and the fact that the money was his was known.

The £11.5m we paid to Vibrac (a company registered in the BVIs whose owners are not known) is one obvious way money could have been taken out of the club. I don’t think the conspiracy stands up to much scrutiny (Vibrac are a known entity who have provided finance for a lot of football clubs) but they could have given Zingarevich or Samuelson a kickback - there’s really no way of knowing either way.

That being said, it doesn’t strike me as a viable form of money laundering. Money laundering involves secretly putting dirty money into a business - using the dirty cash to inflate your books by 20% or something. That wouldn’t work with a business like Reading, you’d have to secretly buy season tickets or club merchandise. It would make more sense to claim Vibrac was a front for regular old embezzlement rather than laundry.

[bcubed]

I mean it looks like the EFL are going to let us sign some players before the end of the window now, too.

What's the point of a transfer embargo if you're just going to let the club spaff a load of money in the last couple of weeks of the window anyway?

We won’t be allowed to do that.
We’ll probably be allowed to bring in a limited number of loans and free agents on restricted terms, and hopefully offer new deals to players we already have.
We’ve done a lot to get the finances under some kind of control and releasingnthe restrictions will recognise that.
The bizarre thing is Derby we’re allowed to sign players some time ago despite having been in far worse trouble than us.

Any ideas how these signings were approved?

[Snowflake Royal]

I mean it looks like the EFL are going to let us sign some players before the end of the window now, too.

What's the point of a transfer embargo if you're just going to let the club spaff a load of money in the last couple of weeks of the window anyway?

We won’t be allowed to do that.
We’ll probably be allowed to bring in a limited number of loans and free agents on restricted terms, and hopefully offer new deals to players we already have.
We’ve done a lot to get the finances under some kind of control and releasingnthe restrictions will recognise that.
The bizarre thing is Derby we’re allowed to sign players some time ago despite having been in far worse trouble than us.

Any ideas how these signings were approved?

Given one of those signings was Aluko who is actually at Ipswich, a mixture of they didn't actually happen, Derby have a smaller squad, and they successfully argued they only gave youth players a cap to fulfill a fixture because of a covid outbreak so they shouldn't count

And they reportedly can only offer much smaller wages than we could, if we had space in the squad to sign someone

[3points]

This is the bit where we need more clarity. IIRC, we were under an embargo the summer that we brought in Joao and Puscas (among others), then suddenly we're throwing money around. So did we just blatantly ignore the fact that the EFL had their eyes on us and gamble on getting promotion that season (which is mental, but quite possible), or did the EFL sanction those moves and the money spent in fees and wages?

If the latter, then the EFL have as much to answer for as whomever it was that sanctioned those deals from within the club.

Either way, the club have to take a large portion (if not all) of the blame - rules are rules, however flawed they may be.

I believe the sequence of events was that in the prior financial period the stadium was sold to Mr Dai for c. £26m. Then, the following financial year, it was re-sold to another company controlled by Mr Dai for £37m (i.e. an additional £11m). This additional transaction was being investigated by the EFL (people assumed it was the original £26m transaction that was under review) which is why we didn't sign anyone during the early part of that transfer window.

Then, when the EFL approved the additional sale, this created further headroom of £11m against the FFP rules and allowed us to sign Joao, Puscas, etc. If you remember as well, it was widely reported at the time that these deals were very loaded, financially, such that upfront payments were kept to a minimum (rumour was we only paid £1m out of a reported £5m fee for Joao at that time).

The way transfer deals are now structured also is a common way to work around the FFP rules (which is probably why Fulham have Harry Wilson on a deferred payment scheme)

[bcubed]

We won’t be allowed to do that.
We’ll probably be allowed to bring in a limited number of loans and free agents on restricted terms, and hopefully offer new deals to players we already have.
We’ve done a lot to get the finances under some kind of control and releasingnthe restrictions will recognise that.
The bizarre thing is Derby we’re allowed to sign players some time ago despite having been in far worse trouble than us.

Any ideas how these signings were approved?

Given one of those signings was Aluko who is actually at Ipswich, a mixture of they didn't actually happen, Derby have a smaller squad, and they successfully argued they only gave youth players a cap to fulfill a fixture because of a covid outbreak so they shouldn't count

And they reportedly can only offer much smaller wages than we could, if we had space in the squad to sign someone

Ta

[Esteban]

This is the bit where we need more clarity. IIRC, we were under an embargo the summer that we brought in Joao and Puscas (among others), then suddenly we're throwing money around. So did we just blatantly ignore the fact that the EFL had their eyes on us and gamble on getting promotion that season (which is mental, but quite possible), or did the EFL sanction those moves and the money spent in fees and wages?

If the latter, then the EFL have as much to answer for as whomever it was that sanctioned those deals from within the club.

Either way, the club have to take a large portion (if not all) of the blame - rules are rules, however flawed they may be.

I believe the sequence of events was that in the prior financial period the stadium was sold to Mr Dai for c. £26m. Then, the following financial year, it was re-sold to another company controlled by Mr Dai for £37m (i.e. an additional £11m). This additional transaction was being investigated by the EFL (people assumed it was the original £26m transaction that was under review) which is why we didn't sign anyone during the early part of that transfer window.

Then, when the EFL approved the additional sale, this created further headroom of £11m against the FFP rules and allowed us to sign Joao, Puscas, etc. If you remember as well, it was widely reported at the time that these deals were very loaded, financially, such that upfront payments were kept to a minimum (rumour was we only paid £1m out of a reported £5m fee for Joao at that time).

The way transfer deals are now structured also is a common way to work around the FFP rules (which is probably why Fulham have Harry Wilson on a deferred payment scheme)

Thanks for the response and the clear explanation.

[Chairman Mao]

2 observations.

1) If true, then the seller has to shoulder some of the blame for not doing proper due diligence

2) ditto fit and proper person's test.

Our current predicament stems from this ill fated sale

id go one step further. JM sold to any old oxf*rd after he was repeatedly boo'd and harangued at his own stadium by the fans of the club that he saved and built from almost nothing, giving us our greatest ever days as fans, and had to put up with moronic "wheres all the money gone" nonsense after ploughing 5+ million a year of his own money into the club to keep us running. so in many ways its our moronic fan base who is to blame for all of this

[Chairman Mao]

Fascinating to imagine where we would be if not for the money of Zingarevich, the Thais and the Dais. Madejski sells to someone who wants to own the club but insists upon it remaining self-sufficient.

Best case scenario is probably Brentford. We could have sold Kebe and that summer and brought through HRK and Antonio as replacements, along with Federici or McCarthy if there was interest. Get by with frees and loans and academy players, and the occasional big-ticket purchase funded by a sale (along the lines of Leigertwood and Gorkss).

At some point we'd probably run out of sellable assets, but we'd still have had Morrison, Le Fondre, Hector, Cooper, Tshibola... and I think there's a good chance some other Academy lads would have had greater sale value than in real life. We might well have got relegated because we only narrowly avoided it a few times. But seems like it would have been better for the club.

^

[Chairman Mao]

RUSTY!! Hope you're keeping well.

I'm doing OK thanks. I just sit here in the background keeping tabs on you all I've had a few scares this year (not covid) but still alive. Shame the club is in such a state as I need little pick me up's on a Saturday till the rugby starts

yay!^

[WestYorksRoyal]

Fascinating to imagine where we would be if not for the money of Zingarevich, the Thais and the Dais. Madejski sells to someone who wants to own the club but insists upon it remaining self-sufficient.

Best case scenario is probably Brentford. We could have sold Kebe and that summer and brought through HRK and Antonio as replacements, along with Federici or McCarthy if there was interest. Get by with frees and loans and academy players, and the occasional big-ticket purchase funded by a sale (along the lines of Leigertwood and Gorkss).

At some point we'd probably run out of sellable assets, but we'd still have had Morrison, Le Fondre, Hector, Cooper, Tshibola... and I think there's a good chance some other Academy lads would have had greater sale value than in real life. We might well have got relegated because we only narrowly avoided it a few times. But seems like it would have been better for the club.

^

I remember after relegation in 08 Madejski implied that there was a reputable buyer who pulled out because of relegation. We definitely could have attracted better than AZ in the Premier League. That woeful performance at home to Fulham remains one of our most damaging losses.

[From Despair To Where?]

If we'd drawn at home to Fulham instead of losing, they would have gone down instead of us. Likewise, If we'd drawn at home to Bolton instead of losing, they would also gone down instead of us.

[Pepe the Horseman]

If we'd drawn at home to Fulham instead of losing, they would have gone down instead of us. Likewise, If we'd drawn at home to Bolton instead of losing, they would also gone down instead of us.

Even if we'd only lost those games by one goal, we'd have stayed up at Fulham's expense.