GC Chief Executive clarifies regulator’s position in Football Index update

By Peter Lynch

Gambling Commission interim Chief Executive Andrew Rhodes has taken to social media to clarify the regulator’s level of involvement with the ongoing proceedings regarding Football Index.

Football Index, a betting offering whereby players could trade shares in professional footballers akin to the stock market, suspended business in March this year following a huge exodus of customers and investors, as a result of the company’s decision to cut dividends on players from 14p to 3p ($0.04).

As a direct result of that decision, many customers lost thousands of pounds overnight, with Football Index then going into administration and having its licence suspended by the Gambling Commission.

The Gambling Commission provided an update on the situation at the end of June, saying it remains in close contact with BetIndex and its Football Index platform, and that the company remains in administration.

A new update has now arrived in the form of a series of statements from Rhodes, who took to Twitter to address concerns directly. Rhodes was announced as the body’s interim Chief Executive in June following the departure of Neil McArthur.

There had been hopes of a Company Voluntary Arrangement (CVA) to reimburse customers who lost money, but Rhodes has now said that the Gambling Commission cannot help determine if this is a feasible option, as it is a matter for the administrators as opposed to the regulator.

“I had lots of quite angry and sometimes abusive messages late last night, about Football Index,” Rhodes said on Twitter. “Much of it was similar to previous messages and, as I have always said I read them all, even the rude ones, and I respond to what I think I can.

“Why no CVA? A CVA may or may not happen – it is not something the GC is involved with and would not be. It's between the administrators and any potential investor/buyer to set up a CVA. If a CVA does happen, then they will likely make an 'offer' for the debts the company has, which would be your bets as well as any other debts. This does not mean you would get all your original stake back – it depends on what they offered. Then the CVA would need to apply for a licence to operate from us, which we would be obliged to consider.

“I have never said 'I dunno' what the bets are worth, as one person said. They need to be valued by the administrators. There are several ways of valuing the debt and whilst many feel this should be the original stake, there are several ways of looking at it. Realistically, this will be part of attempting a CVA and if there is no ultimate rescue for the company the debt would need to be valued as part of winding a company up.”

Rhodes continued by saying that he cannot comment on certain matters involving the investigation, including the date the review into Football Index will be published.

“Many have asked me questions about individuals, what I know about the flow of funds, what we will do in certain scenarios etc – I can't comment on live investigations or individuals while matters are ongoing,” he said.

“I also don't correct assumptions people make which I think are wrong for the same reason. There are some things I simply cannot get into at this point. Some have asked why the review is not out yet. That is not being conducted by the GC so all I know is that it is due in the summer, but I don't have a date yet.”

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