Following on from the hearing of Mark Jacob and Fuglers in front of the Solicitors Disciplinary Tribunal we now have further evidence, given under oath, of how Balram Chainrai, Levi Kushnir and Portpin Ltd were involved in the attempted takeover of Portsmouth Football Club from the summer of 2009 and acted as shadow directors from October 2009 until February 2010. The claims made in the Tribunal corroborate the story told by me and others over the past few months.

Balram Chainrai was always a member of the 'Al Faraj consortium', not a distant financier as he always sought to claim ("I had no knowledge of who was in the consortium that owned Portsmouth." - Balram Chainrai, the Guardian, 2nd April 2010)

Paragraph 8 of the judgement states: "In or about August 2009, the First Respondent (Fuglers) received instructions on behalf of a consortium of individuals who wished to purchase Portsmouth City Football Club Ltd (“PCFC”)." Paragraph 9 says: "Funding to Falcondrone was provided by “Portpin”, a company owned by Mr Balram Chainrai, a member of the consortium."

So Fuglers were appointed by the consortium, Jacob was Portpin's solicitor, and he is believed to have actually incorporated the company Portpin for Chainrai and Kushnir. The client account belonged to Portpin.

Portpin also exercised control over the club's bank account via Jacob, their solicitor, who processed all payments by sending them through to Fuglers, where David Berens finally approved them. It is a clear breach of the rules governing client accounts for them to be used as a general banking facility and Fuglers were found guilty and sanctioned for this.

Paragraph 21.7 states: "The Tribunal then heard evidence from the Second Respondent, Mr Berens. He confirmed that although Mr Jacob, as a director of PCFC, made requests for transfers of money to be made, Mr Berens authorised and made the actual payments. He stated on cross examination that as part of the services provided to PCFC, the firm’s client account had been made available. He stated Fuglers had been concerned about doing the right thing and that they had taken advice from leading Counsel on the matter. Mr Berens confirmed he had considered the rules and he had not thought there was any breach."

Jacob did breach an undertaking after being placed under "duress" by Portpin of a kind he had never previously experienced

Paragraph 14 contains the undertaking: “As discussed I confirm that the funds to be received from the Premier League in relation to the tv receivables and VAT in January 2010 are once received to be held in my firms client strictly to the order of [P] and may only be released once written instructions have been received from either [LK] or [BC] to whichever account they choose without any deductions. This instruction shall be irrevocable.”

Paragraph 25.4 "Mr Jacob had informed Mr Grehan during his interview on 27 April 2011 that the undertaking had been given under duress in circumstances where PCFC was desperate for money to pay creditors. He stated that LK and BC had put him under duress."

As described in the (Ali Al Faraj part 2), the Premier League only passed the money on condition it was immediately transferred to creditor clubs. We did believe this was done directly but it did first pass through the club's account before going on to football creditors. However, the undertaking was breached as described. 

The submissions in court demonstrate beyond a shadow of a doubt that Portpin exercised control over the club between October 2009 and February 2010. In effect Balram Chainrai and Levi Kushnir were shadow directors of Portsmouth City Football Club Ltd as the compnay was known then. The Premier League confirmed to SOS Pompey during a face to face meeting that anyone who acted as a director during this period would not be considered fit and proper owing to a series of rule breaches committed, particularly relating to Daniel Azougy, for which Pompey were fined £1m.

But there is another interesting devil in the detail. As we stated, the first injection of finance from Portpin was £6m, actually closer to £7m.

Paragraph 12: "In respect of Y – P Facility, in October 2009, a total of £6,999,988 was received into the account. In the same month, payments such as Portsmouth Bulk Payroll in the sum of £506,777.17 were made. In the PCFC - General Affairs account, a receipt in the sum of £2,467,500 from the FA Premier League was made on 7 January 2010, and on 3 February 2010 the sum of £1,655,729.60 was paid out to Portsmouth Bulk in respect of players’ salaries."

This paragraph appears to be describing the notable payments in and out of the account. It therefore describes £7m coming in from Portpin and £2.5m from the Premier League in January. In total, around £2.1m was paid out of the account in wages, less than the amount paid in by the Premier League.

The obvious question is, what was the rest spent on then? I'm very nervous of 'fag packet maths' with regard to this period. Fortunately, I won't have to rely on it for much longer. 

Paragraph 25.3 states: "Mr Ryan, on behalf of the Fourth Respondent, Mr Jacob, referred the Tribunal to a Deed of Assignment of Television Payments dated 6 November 2009. This Deed of Assignment had been made between PCFC and the lender, P and had been signed by Mr Jacob. It stated P had agreed to lend £18,500,000 PCFC by way of a secured line of credit by a loan agreement of the same date. As a continuing security, PCFC assigned to P all its interest and benefit in the Premier League Payments."

Yet paragraph 32 says: "Sums in excess of £10million had passed through their client account and payments had been made to third parties, which had ultimately led to Mr Berens writing to Fuglers’ insurers on 2 November 2010 and notifying them of a potential claim."

Now we know in excess of £10m passed through the client account, over £3m of it from the Premier League and £7m from Portpin. Although the facility, secured line of credit for £18.5m is described there seems to be no information about whether it was used. Why say "in excess of £10m" if the amount was in excess of £18m?

Of course, the situation is further clouded by the removal of £5.5m in early February. £4m is acknowledged to have gone to Portpin and the rest is believed to have gone to other consortium members. Whoever it went to, if Portpin are unhappy about them receiving that £1.5m they should take it up with them, not with Portsmouth Football Club. From the moment Jacob gave Berens the instruction to transfer the £1.5m it ceased to be Pompey's problem and became Portpin's. 

So we can see for sure that £6.9m was paid in by Portpin and we know for sure £5.5m was taken out. All the rest is conjecture. How you get to £18m is a mystery. Even Andronikou put Portpin's debt at £12m in a meeting in April 2010. 

Baker Tilly are investigating this period and have access to the complete client account logs.

Balram Chainrai recently said: "I still have a debenture over the club as security on the club's full assets, so one way or another I'm going to get my money back," he said.

You would have thought he would have got the message by now. Yet again, I find myself offering the same advice to Portpin: there is £2.65m on the table. Take the money and walk away with your pride intact. If you don't, there is only one thing you can expect more of at Pompey and that is scrutiny. And not just from some pesky bloggers either...

The judgement vindicates the investigative work of Pompey-fans.com in the following two blog entries published in October: The Truth about Ali al Faraj Part 1 and Part 2

Although several sources and former regimes figures and Pompey insiders had previously described the blogs to Pompey-Fans as uncannily accurate, the judgement puts it on the record. We were also very grateful for the support and praise we received from a whole series of national journalists and editors from the BBC, Guardian, Telegraph, Times, Sun, Sporting Intelligence, Independent among others. 

Micah Hall wishes it to be known that he has received no legal threats and has simply been busy with trying to ensure the fans' takeover of the club is a success. 

The views of Micah Hall are his own and don't necessarily reflect the editorial view of pompey-fans.com. Any proceeds of this column are donated to Action Aid.

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Dinksy added 09:15 - Feb 4 We are about to celebrate our first anniversary in administration. Any chance a 'pesky blogger' can now turn his spotlight on PKF and give us an assessment on its performance in this time?
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