A businessman and a builder have been accused of stripping the gate receipts from home games at Hartlepool United during an attempted takeover.
And as they tried to show the Football League they were ‘fit and proper persons’ to run Pools, they defrauded a business contact to replace the cash, a jury has been told.
Having set up a company called TMH 2014 Ltd, referencing the supporters’ nickname of The Monkey Hangers, for the takeover, the alleged fraud is said to have gone into extra time as they came up with a succession of excuses for not repaying the money.
TMH 2014 was headed by Peter Harris, with former Swindon Town general manager Stephen Murrall as a director.
The two men have pleaded not guilty to fraud by making false representations in January 2015 that they needed funds to satisfy the Football League that they were fit and proper persons to buy the club, and that they had access to a further £200,000.
Standing trial at Warwick Crown Court, Murrall, 49, of Mill Court, Shipston-on-Stour, and Harris, 47, of Compton Court, Watery Lane, Shipston-on-Stour, also deny two more fraud charges.
Murrall has also pleaded not guilty to a further two charges of making false statements with intent to defraud HM Revenue and Customs.
Of the two men, Prosecutor Miranda Moore QC said Murrall had run a number of businesses over the years, but was also ‘a gambler in the true sense, spending tens of thousands of pounds, if not hundreds of thousands, betting online and losing online.’
“He’s organised several fraudulent schemes in an attempt to obtain money. Sometimes he succeeded, and sometimes he didn’t.
“Mr Harris is a friend of Mr Murrell, and is a builder by trade, with no real experience of finance or running a company of any note. He’s the clean name on company documents, put forward as the figurehead of the companies by Mr Murrall.”
Miss Moore said: “These two and two others sought to buy that football club through TMH 2014 Ltd. What was going to happen was that Mr Harris was the chairman of TMH, and he signed a document in December 2014 making Stephen Murrall a director.”
On December 17 a sales purchase agreement was signed with Hartlepool United’s CEO Russell Green for TMH to buy the club.
“You have to be a fit and proper person to buy a football club. What the Football League doesn’t want is people buying a club and stripping it of its assets or beggaring it.
“So you may agree to buy a football club, but you can’t take over until the Football League agrees,” said Miss Moore.
Certain conditions had to be met by January 31, 2015 before they could take over as owners – but Harris believed they should be entitled to the gate receipts straight away, the court heard.
“The Hartlepool finance officer was told that all future money from home matches, including gate receipts and the bar revenue should go into TMH’s bank account.”
A total of £42,453 from the next two home games was paid into the TMH account, but did not stay there, and the League made inquiries, wanting to know the two men were good for the money.
Murrell sent Mr Green an email attachment purporting to be a bank statement showing assets of 1m euros, and other bogus documents followed to try to convince the club it had the money.
When the League rejected their takeover ‘they were left in a bit of a pickle, because they’d taken gate receipts and hadn’t held them in their account,’ said Miss Moore.
They had to repay the club, but didn’t have the money, so on January 11 persuaded Jonathan Rehbein at ESRG to loan them £50,000 over seven days at 20% interest.
But it was never repaid, and Mr Rehbein was fobbed off with a succession of excuses from Murrall, including problems at the bank, a security delay, taking his son to hospital for an operation, collecting his son from hospital, and it being President’s Day in America, the court heard.
Murrall is also accused of submitting false statements and invoices to HMRC between April 2015 and January last year in a bid to obtain ‘just shy of £900,000’ in research and development payable tax credit.
The trial continues.
How the allegations came to light
The alleged frauds came to light after Murrall was made bankrupt in 2015 and he had to hand over computer equipment, on which evidence was found which triggered an investigation.
In July 2014 Murrall had registered Phoebus Banbury Ltd, which was involved in setting up the Phoebus night club in the town and refurbishing the premises, for VAT.
But in an attempted to obtain a VAT refund, Murrall asked a contact, who cannot be named for legal reasons, to provide him with a false invoice for £120,000 plus VAT of £24,000.
That was submitted as part of a claim for a £51,145 VAT refund for the period ending October 31, 2014.
Murrall, who said he would ‘reverse’ it in the following quarter, told the other man to delete their email exchanges – but he failed to do so, and they were found during the investigation.
Also in 2014 Murrall contacted the ESRG Group, which provides financial structuring for overseas projects, claiming that Phoebus Funding Solutions was involved in large-scale clean energy projects in Malta.
Murrall was the CEO of Phoebus Funding Solutions, while Harris was a partner and operations developer, and he convinced Jonathan Rehbein at ESRG that they had a contract signed by Dr Christian Cardona on behalf of the Maltese government.
Mr Rehbein agreed to advance £500,000 for 210 days after seeing a forged letter from accountancy giants Ernst and Young, supposedly underwriting the project.
The money was paid in stages – but almost as soon as it went into the PFS account, it went out again, with more than £160,000 going into Murrall’s personal accounts, and other money being used to support the night club project.
And when the repayment and interest was due, Mr Rehbein was presented with a series of excuses and delaying tactics.
Murrall and Harris are also said to have been involved in a ‘factoring fraud,’ in which First Capital Factors advanced money against a bogus invoice for £93,000 said to have been submitted by Phoebus Banbury Ltd to Avalon Investment Services.