Glasgow Rangers £7.7M bond heist – the important questions
The fans of Glasgow Rangers should have been reading the DevDosh Ltd blog posts on bond debt seniority and payout order.
6,060 fans purchased £7.7M of “Debenture Bonds” to support Glasgow Rangers reconstruction and refurbishment of the main stand to fall in line with new regulations after the Hillsborough disaster. The issuance took place in 1990.
Standard debentures have no collateral backing and so should the issuer fall into receivership they sit very low in the payout order attracting pennies in the pound.
Since the club went into receivership the in 2012 the official receiver has received just £1.4M of debenture holder claims which they have earmarked for settlement.
Despite having a further £3.2M fund set aside for debenture claims the official receiver has invoked a time out law that stops bond holders claiming their money back now.
It seems more should have been done to protect these investors and someone should be taking accountable action to make sure it doesn’t happen again.
1) Should the FCA be intervening and making sure these bonds have to be issued with education to ensure investors know the risks and what action to take on default?
2) Should investors be taking responsibility for their actions and taking the time to research the ins and outs of an investment?
3) Should an official receiver take the time to communicate more thoroughly with debtors to ensure they know they have a claim?
The DevDosh Ltd fixed income investment product is collateral backed and ringfenced in an SPV. We make sure our investors have full recourse to their capital and yield in the event of the debtor or ourselves running into future difficulties. No grey areas, no confusion, just straightforward fair business practice.