Coventry City directors face prosecution over late accounts

DIRECTORS at Coventry City Football Club could face criminal prosecution over unfiled accounts.

Companies House is set to hand down a final warning to club chief executive Tim Fisher and director Mark Labovitch over the late accounts for three companies – Coventry City Football Club Holdings, Sky Blue Sports & Leisure and Otium Entertainment Group – associated with Coventry City’s owners. 

In a letter sent on behalf of Companies House chief executive Tim Moss to Coventry North Labour MP Bob Ainsworth, the registry said it was “actively pursuing the overdue accounts”, adding “despite our ongoing co-ordinated pursuit, the companies have still not filed their accounts”.

“Therefore, all three cases have been passed to our prosecutions team, who will now consider instituting criminal proceedings against the individual directors,” it said.

In 2007, privately-owned hedge fund SISU Capital Limited bought Coventry City FC.

As part of the deal it inherited several contracts. Paramount was the club’s rental payments for its grounds Ricoh Arena (pictured). In 2005, the club moved to the larger stadium Ricoh at a cost of more than £1m per annum to the landlord Arena Coventry Limited (ACL).

However, unlike other clubs, Coventry is unable to make any money from the sale of food & beverage at the site, with those funds also going to ACL. The club’s parent company SISU subsequently tried to renegotiate the terms of this contract but no agreement was reached.

The club’s corporate structure has also proven a source of confusion, with Coventry City Football Club Holdings the operational part of the club, housing the players and coaching staff, while a non-operational subsidiary Coventry City Football Club Limited was placed in administration earlier this year.

David Rubin & Partners administrators Paul Appleton and Stephen Katz were appointed to the club on 21 March 2013, with Otium, registered to many of the directors of SISU, acquiring the stricken club’s assets in June.

However, a rejected CVA on 2 August has left the club under the threat of liquidation and beginning the new Football League season with a 10-point handicap, playing at Northampton Town’s Sixfields stadium, 35 miles from the Ricoh Arena.

A club statement cited in the Coventry Observer said: “We are of course working to resolve the situation and will be providing comprehensive information to Companies House very shortly.

“As is well known, the corporate structure of the football club and the basis on which the accounts were prepared were put in place in 1995 by the club’s previous owners.

“We have now cleaned up this untidy structure by scrapping the old Limited/Holdings set-up and putting the club’s business and assets under one company, Otium.”