How NOT to be a Football Millionaire - Keith Gillespie My Autobiography (20 page)

27

Broke

YOUR account has insufficient funds for this transaction’

The first time I read those words on an ATM screen, I didn’t panic. Truth be told, I had an inkling it was coming. In my fraught final 18 months at Sheffield United, the expenditures were adding up, and there was little appearance money coming my way given my standing with Blackwell. My gross earnings were £26,000 a month. Subtract £10,000 for the taxman, and £3,000 for rent and you’re left with a balance of £13,000 which didn’t go very far with a child to look after and a gambling habit to feed.

Still, I didn’t worry too much about the current account because I had money put away. Not that I had any real idea where it was, but I knew there were investments somewhere. Paperwork was another person’s job; my friend from Bangor looked after that. We first met all those years ago when I scored the goal for Manchester United against Newcastle; he was a golfing acquaintance of Jim, and became a part of my social circle from that night onwards. He worked as a financial advisor and was always offering to take over my affairs. Frances never took to him but as soon as she was off the scene, there was no dissenting voice. I gave him control of my books, believing he would divert cash in the right direction.

I signed whatever forms he put in front of me without paying too much attention, although it wasn’t a very sophisticated system. Often, he would present me with handwritten notes, hardly the secure paper trail. But he was a pal, we spoke most days, and I really didn’t feel there was anything untoward going on. And, besides, there was always enough money pouring into my account to deal with the bills that came my way.

That changed in 2007, with a letter from chartered accountants Hanna Thompson, which laid out the tax implications of the film syndicate I’d signed up to back in 2001. Five full years had passed, and now the little details which I had previously ignored were suddenly very relevant. I vaguely recalled the references to tax bills kicking in after year five.

My understanding was basic.

I was still paying off the £1.3 million loan registered in my name with an income stream that showed up in my tax forms every year. By the declaration of that loan as a trading loss, I’d pocketed the £500,000 tax relief, and blown the majority of it.

The missive from Hanna Thompson detailed that the tax liability due on the Film Partnership Profits was £436,000 spread out over ten years. The figure was calculated as a taxable percentage of the ‘Profit from Partnership’ – the income stream – which showed up annually in my assessment forms. A bank had a charge on that income as security for the original loan. In other words, I didn’t see any of it; it was cancelling out the £1.3 million. All I inherited was the tax arising from that transaction.

Let me give you an example. In my assessment form for 2006/07, the ‘Profit for Partnership’ figure was £128,528. Subtracting the interest charge of £51,624 left taxable profit of £76,941. Therefore, the tax due for that period was 40 per cent of that figure – a bill of £30,776.

Every year, those figures would incrementally increase.

Circa £33,000 in 2008...

£36,000 in 2009...

£39,000 in 2010...

You get the picture.

For 2016, the final year of the arrangement, the tax due was £70,618.

It brought home the insanity of the scheme which I’d signed up to. We, the footballers who signed up in 2001, were naturally going to see our earnings decrease as we hit our mid-thirties and beyond, unless we landed a seriously lucrative managing role. But it’s only a minority who enjoy that good fortune. La Manga chopped into my income. The fall-out from Sheffield United decimated it.

Another example. My tax assessment form for 2008/09, the season I started with Sheffield United and ended at Bradford:

Gross earnings from employment? £402,686.

Tax due on the film scheme? £36,141.

Now, let’s move onto 2010, the season at Glentoran:

Gross earnings from employment? £43,875.

Tax due on the film scheme? £38,995.

Once my Glentoran wage was taxed at 40 per cent, I was left with net earnings of just over £26,000 – almost £13,000 short of what I need to cover my film syndicate bill. And that’s before I dipped into my pocket to buy a pack of smokes and a loaf of bread.

That deficit was set to widen year on year, driving me further and further into debt.

But wait a minute.

What about the films our syndicate had financed? That was one element I remembered from the meeting; the prospect of a bonus on top of the tax relief if our monies went towards a blockbuster. Our partnership was called Castle Media Film Partnership and there was a rumour that the investment had played a significant part in the creation of Band of Brothers, a smash-hit TV mini series which boasted Steven Spielberg and Tom Hanks as executive co-producers.

I set Phil on the case and he made contact with a representative from Scotts, the firm who oversaw our partnership, who said that the interest in Band of Brothers was owned by another syndicate. We had learned there were hundreds of similar partnerships in football, including prominent internationals who had ploughed cash into film leasing. Sir Alex Ferguson had invested into one called Eclipse 35. Why the confusion over Band of Brothers? Because the interest belonged to a syndicate called Castle Media Partnership II – the sequel to our scheme. The Data Protection Act prevented Phil from gaining access to their list of members. We desperately wanted to see it, but permission was denied.

Instead, the man from Scotts told us what belonged to Castle Media Partnership I. He listed three productions. ‘The Glass’, ‘Starhunter’ and ‘Bride of the Wind’.

No, I’ve never heard of them either.

Their legacy is the tax bills that drove me into bankruptcy.

When I tell people that story, two obvious questions arise. The first is straightforward. Why didn’t I put the £500,000 away to prepare for a rainy day? A fair point, but I never had a long-term attitude to cash. In a battle between stocks and shares, and the 1.30 at Pontefract, there was only going to be one winner. The bookies. But I was convinced to save some, and pooled it with the contributions from my bumper contract at Blackburn to divert funds with a view to the long term, to mature in my mid-thirties.

All of which leads to the second question. What happened to those investments?

I started to make enquiries as the fruitless visits to the ATM grew in frequency, and the letters from Hanna Thompson gathered dust. Where had my fallback money gone?

With the help of my sister Angela, who works in a bank and has a good head for figures, I uncovered a mess which spelled out the seriousness of my situation. If I’d involved her in my personal finances from the start, then I could be telling a different tale. I should have brought Phil in too, and it was too late when he learned the full story. I genuinely thought that my pal was acting in my best interests and boy, did it cost me.

All I have to show for those investments are stacks of documents and a trail of emails that make little sense to me. Angela sifted through the wreckage, lifting up streams of correspondence. “What does this mean?” “What does that mean?” I’d shrug my shoulders. No answers.

Things were run by me and I’d agree without paying too much attention to the detail. It turned out that this involved cashing in a lot of investments previously recommended to me; some policies and bonds that were maturing nicely, including a 10-year one that was 11 months away from completion, and putting the money into other avenues, primarily into property.

One evening, my new financial advisor introduced me to a small grey-haired man, a sharply dressed smooth talker who was his brother-in-law. He was a property developer; and I got to know him better through a couple of games of golf and a few beers. He talked the talk, and I was urged to go into business with him. I agreed and invested £60,000 in a property in Bangor. I was given a note which guaranteed a return of £90,000 in 12 months time but by the time it came around it transpired that the cash had been moved to another property. That was the first of the warning signs that I stupidly ignored. When I pressed for a return on two other investments and was sent a £50,000 cheque which bounced, it was another red flag. They quickly came back with a cheque for £15,000 which I cashed and was enough to keep me happy for a while.

The really big venture was a property in Spain which Phil still refers to as the only holiday home in Spain that’s nowhere near the sea. I thought I was buying it off plan for £300,000, with £60,000 up front and a mortgage of £240,000. Angela was on holiday there when she opened my post and read a statement which said the mortgage was £300,000. It then became apparent that I hadn’t bought the house off plan – instead, I’d bought it off a business partner of the property developer, a fact I learned when I found out that £56,000 of my money had been directed towards him. The property developer then promptly disappeared to Spain. I was made promises that I would get my money back but it didn’t materialise. I took legal action but it didn’t do me any good. It just cost another £10,000 in legal fees. The property developer, it emerged, had been driven into bankruptcy.

I kept listening to my golfing pal advisor, though. Regardless of what anyone else said, I was always taken in by his persuasive tone, his apparent conviction, so we embarked on another route. His idea was to get involved in more property deals with a Bangor-based businessman.

Together, we invested money to buy some land across the border in Republic of Ireland, in the rural county of Cavan, a bright idea which turned into a complete disaster. We had 25 acres (when I say ‘we’, I mean the partnership that my cash had been placed into. I learned about all this retrospectively). An initial offer of £3 million came in for the first seven acres, in order to build a shopping precinct. If it had been accepted, it would have covered all the costs, and guaranteed profit on whatever we did with the remaining acres – building houses was the likely call. But Ireland was booming, so the proprietor greedily refused the £3 million, and demanded more. Big mistake. In 2008, the global economy crashed, Ireland fell into recession, and the land was practically worthless. Similar projects around Bangor went the same way. £60,000 here. £200,000 there. All frittered away.

This was all playing out like a day in the bookies. Whatever the loss, there was always another race, a chance to make it right. I was told we had found the solution in the form of an extremely promising deal in Glasgow. It would prove the final straw.

From an investment of £200,000, I assumed a 12 per cent share in a development. As Phil, who was oblivious to my dealings at the time, later pointed out, that didn’t really add up when the paper trail showed that another fella had invested £90,000 for a 27 per cent share, and a third character appeared to have a 29 per cent share from putting in nothing at all. “You’re the only bloody person who invested in these things, Keith,” he said.

I’d been told the land would make us millions, for it was needed for the hosting of the Commonwealth Games in 2014. We had evidence to believe we were onto a good thing. One developer had received £17 million from the local authorities for a contract which was only worth £8 million at the time of purchase. Our people expected a comparable windfall. Instead, the city council, who were under pressure after taking flak for some of the earlier deals, exercised Compulsory Purchase powers that were afforded to them by the Scottish government. It drove the price down rapidly, and reduced the bargaining wriggle room. I ended up with a dividend in the region of £380,000, another sizeable entry in my tax assessment form, but a misleading figure when you broke down the sums.

I’d invested £200,000 in the first place, and then the tax on the so-called profits ate into my share of the pot. And then there was my financial advisor’s cut. When it came to distributing the Glasgow cash, I was informed of a two per cent introducers fee. I believed this to be two per cent of the profit, the £380,000, which would be a return of around £7,600. That wasn’t the case. Instead, I was told it was two per cent of my 12 per cent share. This didn’t make sense to me but to cut a long story short, I was landed with a demand for £50,000.

Somehow, I’d come out making a loss on the Glasgow deal. Angela, by now further immersed in my financial affairs, couldn’t believe what I’d done.

“Please tell me you didn’t pay him 50 grand?”

“Yeah...”

A difficult phone call between Angela and my financial advisor marked the end of our working arrangement, and the start of a painstaking legal process. She called in outside help to try and make sense of what had unfolded.

All I knew was that my problems ran deeper than the insufficent funds message on the ATM screen. I didn’t have the cash to cope with the mounting tax bills from the film scheme. There was an inevitability about what came next.

In the final months at Glentoran, the slide towards the exposure of my struggles gathered pace. I put on a brave face, and reverted to the familiar post-Black Friday defence mode. Deny everything. Mum and Vikki nagged about replying to the stream of letters, believing it was a typical case of me being too laid-back. In truth, I was resigned to my fate. I couldn’t treat the Revenue like Mickey Arnott and ring up to fob them off with a few grand here and there. This creditor was an entirely different animal.

The gambling had to stop. That decision was made once I landed back in Northern Ireland. I just didn’t have the cash to follow the horses anymore. Even at Bradford, I could find a spare £500 in the wallet to squander in the bookies. Those days were gone.

It was a big change, especially as my interest in the horses had extended to co-ownership, in tandem with Gary McCausland, a pal from Belfast. Our first venture, Jurado’s Honour, broke a leg at Navan, which was a pretty grim experience. They put the screens around him, and the next thing we heard was a gunshot. Luckily, we had him insured, and put it towards a horse called First Row, who proved a much better purchase. He won a few races and was good enough to run at Cheltenham in 2006, where he finished ninth in the Triumph Hurdle. Injury halted his progress, but he was a good servant. And moving in racing circles exposed me to information. First Row’s trainer, Dessie Hughes, is the father of the flat jockey, Richard, who provided the tip that led to my biggest ever individual bet. He told us that a horse of Aiden O’Brien’s, George Washington, had a great chance of winning the 2,000 Guineas at Newmarket in 2006. I staked £7,000 on him at 15/8 and he cruised home in front. A tidy win. The problem was that the winnings were soon splurged on horses I knew nothing about. That brief run of luck during Robbo’s time at Sheffield United was the exception to the rule. I followed it up with a lengthy losing streak.