IT’S ALL JUST A LITTLE BIT OF HISTORY REPEATING

The Gaydamak effect on Portsmouth FC.

I have heard it said in Portsmouth Football Club circles that Mr Chainrai and Mr Kushnir are surprised by the amount of interest the fans take in the business affairs of the club. This says a lot for their understanding of the business of a football club.

However, the farcical events of the night of Friday 22 October suggest they have recovered from their surprise. The crass manipulation of fans’ feelings for the club in the melodramatic and premature announcements of immanent liquidation got the desired effect. Fans massed outside Fratton Park to be captured on TV. The story contended with Rooney’s pay all night on the news channels.

Sacha Gaydamak was set up, once more, to be the demon king that would ruin PFC. We all remember Mr Storrie last year and his accusations of Sacha being happy to ‘bring on’ administration. Of course, Sacha signed the agreement that was required. One wonders if the tactic was necessary at all. It seems unlikely, reading the consequent back-pedalling statements from ‘officer of the court’ Andronikou.

Given this resurfacing of the kind of media manipulation that was rife in the months from August to February last season, it is interesting to look back at how the Club was brought to this position in the first place.

There has been an interesting parallel between events in Israel and events at Pompey since the end of 2005.

The story begins with Arcady Gaydamak. Peter Storrie’s comments in the press after we went into Administration made it clear that he thought it was Arcady’s money that was feeding our premiership success. However, Sacha claimed that Pompey was his project. Whatever the truth of the matter, it is clear that there was a wide-spread belief that Arcady was the real beneficial owner of Portsmouth Football Club.

When Sacha bought into Pompey in 2006 his father, a flamboyant, charismatic, and controversial character, already owned Betar Jerusalem and was making a name for himself in Israel through a number of popularist and philanthropic gestures. Arcady was working at building his influence on the Israeli political scene, inaugerating a right-wing ‘Social Justice’ party with the stated aim of capturing seats in the Knesset. He courted Netanyahu and Premier Elhud Olmert. He upset the established Russian Jewish oligarch community, taking an independent stance from their influential political position. He said he was one of the five richest men in Israel and spent time and money courting popular opinion.

Behind all this, Interpol had an international arrest warrant out for Arcady as a result of  the French ‘Angolagate’ enquiry. Throughout the nineties Arcady had been a prominent advisor to President Dos Santos in the civil war against the forces of UNITA. He  was accused of supplying arms to the Angolan government from ex-Soviet sources despite a UN arms embargo. These arms included the landmines that still plague Angola today. Along with his partner Pierre Falcone and Christophe Mitterrand he was also accused of influence peddling and corruption.

Arcady claimed the charges against him were politically motivated in his capacity as ‘economic advisor’ to Dos Santos – a position which provided him with a diplomatic passport and allowed him to influence the highly profitable Angolan diamond market. Here he partnered Lev Leviev in the setting up of Leviev’s monopoly over the Angolan market in ‘blood’ diamonds. (See ‘Key Sources’ below).

There is much controversy in Arcady’s role in Angola, and it is interesting to note that he moved freely between countries all the time the enquiry was underway. (Greater detail can be found in the ‘Key Sources’ below).

This was Arcady’s history before he arrived in Israel. The Israeli press was under no illusion that Arcady’s foray into Israeli politics was to prove his oft quoted statement, ‘I am a good man,’ and aimed at ‘cleaning up’ his image.

Despite Arcady’s popular public acts seeming to belie the allegations against him, his business life was more complex. His dealings in Israel created a tangled web of relationships which have strange links to Pompey’s recent and current owners. 

Even before Sacha’s involvement in buying Pompey, in March 2005, Arcady was being investigated by Israeli police for his part in the money laundering scandal at Bank Hapoalim. He has constantly claimed his innocence – and continues to do so as he undergoes trial in Israel now (October 2010). Indeed there was very little money in his account at the time the police raided the bank – although a large sum was said to have been transferred out just before their investigations started. Suspicion was strong enough for Arcady’s assets in other countries to be frozen at that time although some have been released since. (1)

Despite this he purchased Ocif in April 2007 – buying the property company at 85% over valuation with money borrowed from MTZF bank. This deal was mediated for him by Ron Maneh. He had plans for a property company extending into Russia, Israel and Africa. His purchase of Ameris from Kushnir and Chainrai was intended to provide a holding company for Ocif’s various activities.

His plans collapsed along with the sudden failure of the property market in Israel in August 2007. This collapse was precipitated partly by the fall of Heftsiba – a large construction company whose CEO was found to have undertaken corrupt dealings due to his indebtedness to grey market lender Shlomo Narkis. (2)

Over the next 12 months Arcady’s business dealings began to unravel. Not only was he unable to service bank loans tied up in Ocif, or meet his payments to Chainrai and Kushnir for Ameris shares – but also as early as July 2007 he was in dispute with Ron Maneh over the negotiation fees for Ocif, for a failed venture into the supermarket business with a company called Tiv Ta’am and two other business deals.

This dispute with Maneh was conducted through both the media and the courts, descending into a very public slanging match at one point – with Arkady accusing Maneh of trying to defraud and swindle him. Maneh fired back with accusations that Gaydamak ‘conducted negotiations with a lack of good faith.’ Gaydamk followed up with a law suit and Maneh accused him of slander. (3) Gaydamak claims he never agreed to pay Maneh anything. If the usual business methods of the Russian/Jewish community – those of not committing too much to paper - prevail in this case, then Maneh may have trouble getting his money.

Currently, I can find no record of this case having been settled. It is an interesting illustration of negotiation by media however, as seen more recently at Pompey.

By Summer 2008,  whilst on the football field both Gaydamak teams had some success – Betar being Israeli champions and Pompey winning some cup or other – Arcady was apparently in a deep financial mire. He was running a political campaign to become mayor of Jerusalem in the elections of November 2008, not a cheap thing in itself, whilst at the same time facing court action on a number of fronts for money owed – the case with Ron Maneh was still ongoing. Angolagate was proceeding apace and a new money laundering case was running alongside the Bank Hapoalim issue. Arcady had to put up surety of $2.5m to bail himself whilst the new investigation of accusations by a Dutch Company continued. (4)

In September 08 a receiver was appointed for Ocif on behalf of the MTZF bank. Ocif’s value had now fallen by 50%. Creditors – including Chainrai and Kushnir to whom Arcady had defaulted on the Ameris deal – appeared to be queuing up for their money. In a complication of court cases Ocif was sold and the bank got repaid. There doesn’t seem to have been enough collateral to appease other litigantshowever, as liens on Arcady’s assets were appointed to three separate parties in three separate judgements. (5)

It is at this time that Pompey appears on a list of Arkady’s assets. (6) Quoting Ydioth Ahronoth – an Israeli newspaper – the Times and other UK papers reported that Arcady valued Pompey at £300m. This unlikely sum gave the statement a surreal feel and the Premier League felt secure in stating that Sacha was the owner. What Arcady’s Israeli creditors may have felt is not known.

Speculation concerning Pompey was rife and in October 2008, whilst Harry was jumping ship, an article appeared in The Times (October 19th) suggesting that court documents in the Angolagate investigation showed Sacha had in the past received some of Arcady’s arms dealing profits  – about £34m. Again Sacha rigorously claimed that money used to buy Pompey was his own.

Meanwhile, Arcady continued his mayoral campaign but by election day, November 8^th, his standing was not high, and a dish-the-dirt article in al Jazeerah with the subtitle ‘Shady past haunts would-be mayor’ probably helped discourage voters – he polled just 3.6% of the vote. (7)

As far as Israel was concerned Arcady seemed to be finished. In December 2008 he paid the $2.5m surety to the court and fled Israel for Russia – in a luxury jet plane. Haaretz headlined the event ‘Mogul Gaydamak is fated to wander the world as a vagabond.’ The article concluded:

“All of the scandals have helped to forge the image of Gaydamak, that of a combative and quarrelsome man, who lives with the powerful contention that the world is against him. His jaunt in Israel lasted four years, in which his star rose like a blazing comet to the sky, eventually falling back to Earth with the same speed.

Not only did his workings and management style trip him up, it did the same for the Israelis he came in contact with, from financiers to politicians to lawyers and journalists that were willing to bow before any big mogul bursting forth from the darkness, without bothering to check whom they were dealing with.” (8)

In January 2009 one Daniel Azougy appeared at Betar demanding money, supposedly on behalf of Arcady, but the club appeared to be on the verge of bankruptcy and Azougy got nothing. Betar, like Pompey at the same time, started to sell off their playing squad.

By April 2009 there were claims in the Israeli press that Sacha was hiding Arcady’s money. (9) Arcady’s creditors were still persuing payment and this story, true or not, will not have appeased them. Sacha told Storrie to find a buyer for Pompey.

May 2009 was when the games with PFC really began. First came al Fahim, then Storrie’s ‘level you won’t believe’ consortium – which included people suing Arcady. This consortium is the one that finally gained control in October 09 and involved interested parties who included Mr Chainrai, Mr Kushnir, Mr Maneh, and his lawyer Yoram Yossifoff. Interestingly, the latter two are currently under investigation in Israel for tax evasion. (10) Of course, the consortium was fronted by that well known Saudi Mr Ali al Faraj.

By the time al Fahim was failing in September 2009, the Israeli courts had awarded Chainrai and Kushnir another lien on Arcady’s assets on September 28, which included Betar Jerusalem, his house in Caesarea, Bikur Holim hospital and a number of cars. However, the viable status of these assets was questionable and Betar Jerusalem undoubtably was in debt to the verge of bankruptcy. (11) Considering that by March 2010 Chainrai and Kushnir were threatening Arcady with bankruptcy proceedings one can only assume they didn’t get any money as a result of this charge. There was an out of court settlement of this case in June 2010. What that settlement entailed was not reported. (12)

In October 2009 Arcady received two judgements that were to keep him in Russia until now. On 10^th he was finally indicted for money laundering in the Bank Hapoalim case (along with about 50 others) and on 28^th he was sentenced, in his absence, to 6 years imprisonment for his part in Angolagate by a French court.

Also in October 2009 the al Faraj consortium took over at Pompey and we were told that Mr Chainrai’s Portpin lent money to Mr al Faraj’s Falcondrone. They bring in Mark Jacob, who had been an associate of Yossifoff’s since 2000. (13) Also in their train comes Daniel Azougy, known associate of Shlomo Narkis who has admitted to being present at a meeting between Narkis and Arcady Gaydamak. (14)

In January 2010 Sacha Gaydamak gave an interview to Colin Farmery. When asked about his father’s connections to Balram Chainrai, Levi Kushnir, Ron Maneh, Yorim Yossifoff and Daniel Azougy he suggested their involvement in Pompey was just a coincidence.

The glaring question is, would they have been so aware of Pompey if they hadn’t been interested in Arcady’s business affairs and did their difficulties in getting paid by Arcady play any part in their desire to control the club?

The land needed for the future essential development of Pompey as a successful business still rests in the hands of Sacha Gaydamak. You have to ask yourself, in the light of this history, whether there is any room for amicable negotiation between the two factions involved in the debacle of October 22. How will these affairs continue to affect the club?

The story is not over.

The point of retelling all this is that we can not yet afford to forget how we  got where we are now. That the story goes beyond Pompey and even football only highlights the need for more careful regulation of the business of football and the ownership of clubs.

That such events can have a knock-on effect onto the community and City of Portsmouth – so far removed from the source of the problem – is testament to the fact that English football has become too far detached from its origins.

Time to give football back to the fans. 

Acknowledgements

This somewhat simplified (believe me) history is indebted to two Pompey sources for its origins. The first is the work done by pompey-fans.com, in particular by Mike Hall, in unearthing the connections between the people involved. The second is the excellent archive of the pompeyonline.com message board, in particular the posts of gazzpfc going back to 2005. These latter posts provided a number of the Israeli newspaper sources listed in the notes below.

Sources

Key sources for Arcady Gaydamak’s activities in Angola (long, but worth a read):

http://www.corpwatch.org/article.php?id=2576

 http://projects.publicintegrity.org/bow/report.aspx?aid=154

Also see: ‘Angola the New Blood Diamonds’ the text of a talk by Rafael Marques given in November 2006 can be downloaded from the School of Oriental and African Studies website. (Be warned: This article contains a harrowing account of the human rights abuses carried out in the mining of Angolan diamonds.)

Notes:

1. Reported widely in Israeli press and summed up here:  http://www.onejerusalem.com/2006/01/03/arkady-gaidamak-billionaire-sports-fan-newspaper-owner-arms-dealer-did-i-miss-anything/
2. http://www.haaretz.com/print-edition/business/heftsiba-head-had-joint-account-with-money-launderer-1.227434
3. Haaretz July 2007 http://www.haaretz.com/print-edition/business/gaydamak-fires-back-at-roni-maneh-after-failed-tiv-taam-deal-1.226200
4. ynetnews.com 11.04.08
5. http://www.haaretz.com/print-edition/business/segev-buys-ocif-from-gaydamak-1.254640
6. Times Online September 15 2008
7. http://www.ccun.org/News/2008/November/11%20n/Money%20Launderer,%20Russian%20Jewish%20Businessman,%20Arkady%20Gaydamak,%20Running%20for%20Mayor%20of%20Occupied%20Jerusalem.htm
8. http://www.haaretz.com/news/analysis-mogul-gaydamak-is-fated-to-wander-the-world-as-a-vagabond-1.259903
9. http://www.jrtelegraph.com/2009/04/is-sasha-gaydamak-hiding-arcadys-assets.html
10. Haaretz.com 21.06.10
11. http://www.jpost.com/Home/Article.aspx?id=158861
12. http://archive.globes.co.il/searchgl/Gaydamak%20avoids%20bankruptcy%20with%20settlement_h_hd_2L34oCJWoCbmnC30mDJOuEJOtBcXqRMm0.html
13. http://www.thelawyer.com/kidd-rapinet-seals-international-tie-up/86929.article
14. Revealed by pompey-fans.com in February 2010: http://www.fansonline.net/pompey-fans/article.php?id=175

©S. J. Maskell 2010 This article first appeared on pompeyonline.com 26/10/10.

HMS Edinburgh's Gold.

Fictional Diary Extract from the Life Story of Ted Beard.

Ted Beard, my grandfather, was a Royal Marine on board the cruiser HMS Edinburgh during WWII. Edinburgh was engaged on convoy escort duty in the Arctic in 1942. This entry describes the events before Edinburgh set off back to Scapa Flow.


Sunday 26^th / Monday 27^th April

The Edinburgh had arrived at the Kola inlet, Murmansk, on 19^th April and supplies were unloaded for the eastern front 20 miles away. Constantly subject to air raids, sleet, snow and temperatures of 10 degrees below freezing, there was little time for rest.

Approaching midnight, the docks at Murmansk are unusually quiet in the dull grey daylight. The air raid had ended an hour ago and the port seems to be sleeping uneasily under its cape of snow. Ted is with Major Caffyn at the top of one of the ladders leading from the lower deck up to Edinburgh’s flight deck. From this vantage point he can see the Royal Marine squadron stationed on guard along the lower deck and up the ladders. Each man is armed and alert.

            A pair of barges slide into view, coming from the southern end of the inlet. Both carry Russian soldiers armed with Tommy guns. They draw alongside and cut their quietly popping engines. Once they are secured, Ted hears the ship’s bugle shrilling below decks, then the order.

            ‘Both watches - duty hands fall in. Starboard waist.’

            Soon ratings can be heard grumbling as they come onto deck, ‘Quarter to bloody midnight.’

They are silenced by the sight of the armed guard. Hastily they fall in. With quick economy, the naval officers organise them into pairs to unload the barges. Disciplined and orderly, each pair lifts a heavy wooden rope-handled box onto the deck and from there up the ladders to the flight deck. The boxes are then lowered by ropes into the bomb room three decks below.

            Ted hears them whispering as they pass.

            ‘’Ere, it’s gold this!’

            He watches this realisation pass along the line of toiling men. More reverential now, they manoeuvre the boxes with great care. The hushed atmosphere makes him want to hold his breath.

            ‘’Ow much is there?’ Still they whisper.

            ‘There’s tons of it!’

            ‘Someone kidnap the King?’

            ‘’Ope no one’s told `Itler wot we’re carryin’.’

            Sleet starts to fall, carried by a niggling breeze, making the walkways slippery. The ratings struggle to keep their footing as they cross the deck. One staggers, letting go his rope handle, earning curses from his partner. As he bends to seize the handle again he lets out a shout.

            ‘Oi, who’s bleedin’?’

Across the deck is a trail of scarlet blotches. The line of men stops. They stare at the stains. Their eyes follow the spreading spots to the foot of the ladder down which Ted is also staring. A box about to be hoisted by its carriers slowly drips red onto the snow. Nobody moves.

            An officer hurries over, ‘It’s only the sleet making the stencilling run. Move along there.’

            Reluctantly the line picks up pace again.

            The Major and Ted stand back as the sailor who’d first seen the drips passes. He glances at them grimly.

‘It’s going to be a bad trip, sir. This is Russian gold, dripping with blood.’

The Edinburgh sailed with Convoy QP11 on Tuesday 28^th April. At 16.13 on Thursday 30^th she was torpedoed amidships and aft by German submarine U456.

In the beginning ...

... was the blog.

Here will be the collection of where to find me online.

Pompey Online (pompeyonline.com) is down for maintenance at the moment (11/03/11) but will back up soon with my main football articles on the mainpage.

Contributing to Twohundredpercent, latest article:
http://www.twohundredpercent.net/?p=11620

Meanwhile the blog on good old Shoot! is updated regularly:
http://www.shoot.co.uk/news/latest_article/C49/championship/pompey_mid-table_mediocrity_yes_please

Also planning to contribute to new website:
http://www.sospompey.com/

Other places where I can be found:
http://www.linkedin.com/profile/view?id=84403071&locale=en_US&trk=tab_pro
http://twitter.com/#!/SjMaskell
http://www.facebook.com/profile.php?id=100001276988812&v=info#!/profile.php?id=100001276988812&sk=info