MP demands inquiry into Leeds Utd

12.00.00pm UTC (GMT +0000) Fri 15th Jun 2007

Ken Bates regained control of Leeds Utd after a vote by creditors

A Yorkshire MP has called for a police investigation into the collapse and immediate resurrection of Leeds United.

In a Commons motion Liberal Democrat MP Phil Willis (Harrogate & Knaresborough) called for an inquiry into whether criminal activity had taken place.

He has criticised how the club went into administration with debts of £35m.

A Leeds United statement said: "We challenge him to repeat his allegations outside the House of Commons and we will see him in court if he does."

'Lack of transparency'

In the motion Mr Willis has called on the Serious and Organised Crime Agency and the Serious Fraud Office to investigate the club's financial dealings and the involvement of offshore companies in supporting the resale of the club back to chairman Ken Bates.

Co-signed by the party's sports spokesman Bob Russell, the motion raises concerns over the "lack of transparency" over financial affairs of Premier and Football League clubs.

The petition says: "That this house. . . is appalled that the owners of Leeds United, Forward Sports Fund, not only avoided the effects of points deduction by going into administration after relegation from the Championship was confirmed, but re-emerged from administration within 24 hours having abandoned £35m worth of debts."

Phil Willis MP has urged the Serious Fraud Office to investigate

The motion urges HM Revenue and Customs "to take action to challenge the Administrator's decision not to recover the £7 million owed to taxpayers".

It also calls on the "Serious and Organised Crime Agency and the Serious Fraud Office to investigate whether criminal activity, including money laundering, has taken place".

Mr Bates put the club into adminstration on 4 May with debts of £35m blaming HM Customs and Revenue.

He told BBC Radio Leeds: "The Inland Revenue acted extremely unreasonably.

"Over the last two-and-a-half years Leeds have paid between £15m and £20m to the Revenue, but our cash flow dried up and we asked for a holiday.

"The Revenue said no and put foward the petition to wind up the club. I'm sorry small creditors have lost money, but that is totally down to the Revenue."

Administrators KPMG agreed to sell the club back to him, but the deal had to be approved by creditors.

Mr Bates regained control of the club earlier this month, when 75.2% of creditors backed his plans to offer them just 1p in the £1 of debts owed.

Yorkshire Post 13 June 2007