Often Partisan

Commission and Pannu

David Conn of the Guardian broke a news story last night concerning a payment made to Peter Pannu as commission for Mr Pannu winning an out of court settlement against the former owners of the club.

The piece, linked here, goes on to state that the Guardian have received internal documentation that Mr Pannu had an agreement with Carson Yeung whereby Mr Pannu would receive a commission of 10% on “whatever I bring into the club by way of earnings and profits”.

Whilst the article has a couple of glaring inaccuracies – for example Peter Pannu was appointed as “Acting Chairman” whilst Vico Hui was out of the country rather than Carson Yeung, who has never held the position of Chairman – it is understandable why it’s got fans aflutter on the messageboards and on social media. Although Mr Pannu may well have earned the commission he was paid for his services with respect to winning the out of court settlement, there does seem to be some questions over the corporate governance in how the deal was agreed. Furthermore, it’s worrying what this commission agreement related to and I would like Mr Pannu to clarify where else he was paid a commission by the club or by BIH, if only to refute any wild speculation that he might have taken a cut on transfers as an example.

Many people have focussed on the payment as the crux of this article but I personally think that is misguided. I think that there are bigger questions to be asked with respect to corporate governance – not just here, but in Hong Kong.

For example, the article states  that Pannu sent to the financial officer at Blues an attachment to an email consisting of a document signed by Carson Yeung giving Pannu unlimited authority to act on Birmingham City’s behalf. Whilst I have no doubt that Carson would have given Mr Pannu that kind of authority, I’m curious to know if he cleared it with the rest of the BIH directors before doing so. One would think that prior to handing over free rein of a multi-million pound business subsidiary that made up 95+% of the holding group turnover to an associate who is neither a director of the holding company nor the subsidiary that Carson would have to have the okay of the other executive directors at least.

Furthermore, I’m concerned by the account given whereby Mr Pannu states that he was given authorisation in the presence of Steve McManaman (who was an executive Director of Grandtop/BIH until June 2012) only for Mr McManaman to deny it completely when asked by the Guardian. The fact that McManaman cannot recall the conversation seems beside the point to me; the fact that Mr Pannu thought that the fact he’d had the okay in front of an exec director (who according to BIH’s own documents had not attended one of the 43 board meetings mentioned in the 2009 or 2010 annual reports) along with a vague assurance it had been agreed in Hong Kong on other occasions was enough of a firm resolution baffles me considering Mr Pannu is a trained barrister.

I hope that Mr Pannu – who declined to answer questions that the Guardian put to him personally – will issue a statement to the fans to reassure us that there aren’t any reasons to be concerned and that he will be able to fully explain some of the issues raised by the article. As the article makes continued reference to lawyers answering on behalf of Mr Pannu I assume that there are legal issues with respect to the article and as such I have disabled comments on this story only. Please do not comment about this article elsewhere on this site as comments will be summarily deleted.

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