POLICE are facing allegations of a criminal nature in connection with the malicious prosecution of the former administrators of Rangers in connection with the collapsed club fraud case, a court has heard.

The revelation came before a senior judge criticised the police for an unwillingness to co-operate over the fast-tracked lawsuit by David Whitehouse and Paul Clark of Duff and Phelps who are suing both the Lord Advocate and the Chief Constable.

Mr Whitehouse and Mr Clark (below) were subjected to criminal proceedings with others in the wake of Craig Whyte's purchase of Rangers from Sir David Murray for a £1 and its subsequent sale before a judge dismissed the charges.

Mr Whitehouse, of Cheshire, subsequently brought a damages claim against the Lord Advocate James Wolffe QC and the former chief constable of Police Scotland, Phil Gormley, for £9m. Mr Clark, of Surrey, sued for £5m.

READ MORE: Judge criticises police for unwillingness to co-operate over Rangers fraud case malicious prosecution

The Lord Advocate has previously admitted malicious prosecution and a breach of human rights in the investigation while the administrators have conducted a multi-million pound damages claim to clear their names.


Mr Whitehouse and Mr Clark's actions stemmed from their alleged treatment by the police and prosecution authorities.

The Court of Session has heard from Iain Ferguson QC for Mr Clark that "all the main [police] players have refused to be precognosed [quizzed]" in connection with the case. They were officers who were principally in charge of the investigation.

Alastair Duncan QC, representing Police Scotland, said there was “no difficulty in police providing witness statements”.

And he revealed that "on at least two occasions"... "criminality has been alleged against police officers".

He added that fellow ex-Duff & Phelps executive David Grier, 58, who is also suing the police and Crown, had also made complaints about criminal behaviour by officers.

He said there was still a dispute in the case and there were statements from 25 officers to consider.

There had been no bar and no instruction for police officers not to co-operate.

But he said here were "serious allegations" made against individual police officers and that it had been left to individual officers in those circumstances to provide precognitions and witness statements were available.

HeraldScotland: craig whyte in dressingromme.jpg

Craig Whyte

“It’s been left to them to determine whether, in those circumstances, they wish to provide precognitions," he said.

He added: “I understand why police officers in that situation might be uncertain about whether they should submit to precognition rather than produce witness statements in the usual way.

"They obviously have the usual rights in relation to criminal allegations as anyone else."

He said he saw no reason why there was not an explanation over matters relation to a "breach of legal privilege".

But judge Lord Tyre said: "It may be serious, that's the nature of it, but at some stage they are going to have to answer them one way or another. 

"To my mind it is, well, disappointing would be a mild word, that the police as public servants are not willing to co-operate and assist with this process without being forced to do so by giving evidence in court.

"Simply the fact the allegations are serious is not an excuse. They should be in a position to tell their side of the story."

In another development, which relates to the amount of damages paid out, Gerry Moynihan QC, for the Lord Advocate, said that the Crown is totally liable in the case.

He previously said the Crown accepted liability for “malicious prosecution”, but not from before the men first appeared in court on petition in November 2014.

Mr Ferguson previously described the government's actions in pursuit of the men as "nothing short of a disgrace".

Mr Whitehouse’s lawyer Roddy Dunlop QC said their remaining legal action against the Crown would focus on the amount of damages that the businessman should receive.

Lord Tyre ordered the police officers in the case to submit their statements to the court by October 13.

He also ordered the Crown to make an additional payment to cover both Mr Whitehouse and Mr Clark’s costs.

The case comes three years after former Rangers owner Craig Whyte, who was the last man standing in the fraud conspiracy case, was acquitted of taking over the club by fraud at the end of a seven-week trial.

It is claimed that at no stage was there any justification for their detention, committal or prosecution and that the Crown never had sufficient evidence for any of the charges it brought.

Mr Whitehouse and Mr Clark won a ruling from a specially convened bench of five judges at the Court of Session in Edinburgh last year that the Lord Advocate did not have absolute immunity from a civil damages claim in such circumstances.

The latest developments come four years after London-based legal firm Holman Fenwick Willan, who were acting for Duff and Phelps, was awarded £500,000 costs after police and prosecutors were found by the High Court in London to have "abused state powers" by carrying out an illegal raid and seizing privileged documents in connection with the failed Rangers fraud case.

It emerged last month that former Rangers director Imran Ahmad was to receive a public apology from the head of Scotland's prosecution service and significant damages after he was wrongly pursued prosecution on fraud charges.

He initially wanted £2m in damages but it is understood he is now claiming tens of millions of pounds.

Former Rangers chief executive Charles Green is also suing Police Scotland for wrongful arrest after charges against him were dropped.

The Lord Advocate and chief constable had been contesting the actions.

In June, last year, the Herald revealed the Crown Office paid compensation estimated at £80,000 to Mr Whitehouse and his wife over the granting of a restraint order over his assets which Scotland's chief legal officer admitted was "wrongful".

The Whitehouses had said that the granting of a restraint order in connection with the Rangers fraud case, which was eventually reversed, led to a loss in a particular investment opportunity, issues with making financial transactions and that they suffered a "loss of reputation, anxiety and distress".

A judgment by Lord Brodie over the release of papers involved in the case, revealed that the Lord Advocate admitted that actions in applying for the restraint order against the Whitehouses in December, 2015 were "wrongful in the respect of a failure to discharge the duty of disclosure and candour as found by the judge when recalling the order". The Lord Advocate at the time was Lord Mulholland.

Lord Glennie, one of Scotland's senior judges reversed the granting by Lord Clarke of a Proceeds of Crime restraint order over the assets of Mr Whitehouse and his wife.

In his ruling, Lord Glennie said the court were previously not told that there had been a period of 13 months of suspicion-free activity while Mr Whitehouse, who was Manchester-based managing director with Duff and Phelps, was subject of the Rangers fraud investigation.

He said the Crown were responsible for "a clear and very serious breach of the duty of disclosure and candour" in getting the restraint order.

The Crown Office had claimed Mr Whitehouse had benefitted from the proceeds of crime having been paid personally £3.1m for the administration, and that he had had a share of the proceeds of MCR, a UK-based restructuring and turnaround firm which was bought over by Duff and Phelps, which had advised Mr Whyte on his controversial takeover.

One of the key tenets of the Crown case was Mr Whyte's scheme in advance of the takeover, to sell off rights to three years of future season tickets to investment firm Ticketus in a bid to raise £24 million and pay off debt as part of a share purchase agreement with Sir David Murray.

Lord Glennie in his judgment had said he had been shown documents by Mr Whitehouse's QC that make it clear administration fees were paid to his employer Duff and Phelps.

The civil claim cases continue.