MFC Loan to Schwab

[rpfc 28,220]

I think Mono said this is a black mark.

I dunno - if it blows up it's a black mark, but even then - it isn't like we can't recoup the loss through salary garnishing.

Back when 'outsourcing' meant moving your business ops to another suburb not country, companies used to do this sort of thing for their employees.

Not done much anymore, but that is more to do with a lack of belief in employees (and the length of time they will stay at the company) than the practice itself.

[Ned 156]

I'm not sure when Schwab is next in Sydney but I'll certainly be asking him about it if he meets with members.

[Dee Fan 3,247]

Not done much anymore, but that is more to do with a lack of belief in employees (and the length of time they will stay at the company) than the practice itself.

You're right it's not done much nowadays and that I believe is due more to the transient nature of the workforce than the trust in the employee or Corporate Governance. The old days of Managers or Directors getting 0% interest loans from Public Companies is long gone, and so it should be. This was a short term loan of some three years at a more than acceptable rate of interest so I can’t see the problem.

Cam is one of the best Football Club CEO’s going around and he’s done a lot to turn the fortunes of the club around, if we can make it more attractive for him to stay and continue to perform his job at the club then why not. It doesn’t hurt the club’s bottom line and I doubt they would have been able to earn a higher rate of interest anywhere else.

I must say I’m disappointed at some of the comments made by some on here that, seemingly, should know better I get the feeling that some want to find fault with anything and others just want to keep their post count up.

[Dee Fan 3,247]

I'm not sure when Schwab is next in Sydney but I'll certainly be asking him about it if he meets with members.

You do that Ned but make sure that you are prepared to disclose details of your employment and any benefits you get from it.

[Tim 3,413]

I get the feeling that some want to find fault with anything and others just want to keep their post count up.

Absolutely does not describe me, on both counts. And I don't like the optics of the deal. Cam's performance has been brilliant for the club. I just don't like this arrangement, and would rather that the need for the finance was accommodated in another way.

Edited March 30, 2011 by Tim

[Roost It 1,434]

Careful your saddle is slipping. B)

My horse must be losing weight.

[demoniac 1,330]

Don't have a problem with it.

Secured loan at around market rates to a key employee that was disclosed in the Annual Report.

[Louie 39]

I don't have a problem with the loan but it could have been done better as the club will face a fringe benefits tax liability on the provision of this loan. It may have been advanced at a market rate of 6.2%, however the ATO considers the benchmark interest rate for the 2011 FBT year to be 6.65%. Therefore a fringe benefit of .45% will arise. It's not a huge amount but it all counts when you are a struggling club.

This loan isn't the cash cow for the club that some people are suggesting. The club had to go out and borrow the funds to on lend and then pay FBT on top. The margin, if any, would be very small.

Anyway, what's done is done. It was clear and transparent and that should be all is required.

[demon3165 2,662]

I don't have a problem with the loan but it could have been done better as the club will face a fringe benefits tax liability on the provision of this loan. It may have been advanced at a market rate of 6.2%, however the ATO considers the benchmark interest rate for the 2011 FBT year to be 6.65%. Therefore a fringe benefit of .45% will arise. It's not a huge amount but it all counts when you are a struggling club.

This loan isn't the cash cow for the club that some people are suggesting. The club had to go out and borrow the funds to on lend and then pay FBT on top. The margin, if any, would be very small.

Anyway, what's done is done. It was clear and transparent and that should be all is required.

Just to get this right, you know how this loan was put together and all the other bits of info relating to it?

[H_T 3,043]

It appears to be some sort of bridging finance and if Cam had gone to a bank he would have been punished so the club loaned him the money at a commercial rate and with conditions that the loan be paid back in two or three years. It is a benefit to the club as it shows faith in its chief executive and they are getting an acceptable rate of return, on par with term deposit loans so whats the issue?

Nothing to see here move on.

^ This. Investment in a KPP of the club.

[Red Sox 2]

You do that Ned but make sure that you are prepared to disclose details of your employment and any benefits you get from it.

Why? Does Cam pay a membership fee each year to Ned's employer? Obviously many are unhappy the story was reported by Caroline but now that has been highlighted as opposed to listed in a report, it's not unreasonable that a member may ask the question of Cam or another MFC board member directly? As opposed to hypothesising here perhaps?

I'm not sure why anyone has any annoyance, 1 - with the story and 2 - with members that question this.

Edited March 30, 2011 by Demon Hill

[Rogue 585]

You do that Ned but make sure that you are prepared to disclose details of your employment and any benefits you get from it.

Only if Ned was a CEO etc of some company Schwab was a shareholder in would that make sense - it's not otherwise analogous.

EDIT: Beaten.

[Dee Fan 3,247]

Why? Does Cam pay a membership fee each year to Ned's employer? Obviously many are unhappy the story was reported by Caroline but now that has been highlighted as opposed to listed in a report, it's not unreasonable that a member may ask the question of Cam or another MFC board member directly? As opposed to hypothesising here perhaps?

I'm not sure why anyone has any annoyance, 1 - with the story and 2 - with members that question this.

So from what you say Ned has the right to know the salary of every employee of the club just because he pays a membership?

Is that correct? The pettiness of some people on here amazes me, let's go hammer and tong at each other over a loan that was all above board and forget about discussing the football. Let's make life uncomfortable for the CEO and with a bit of luck at the next Annual Meeting we can embarrass him enough to force him out.

[Rogue 585]

So from what you say Ned has the right to know the salary of every employee of the club just because he pays a membership?

Is that correct?

That's not how I read the comment (again, I don't think your example is analogous).

I hope you're not deliberately misrepresenting the contention in order to score points.

[Dee Fan 3,247]

That's not how I read the comment (again, I don't think your example is analogous).

I hope you're not deliberately misrepresenting the contention in order to score points.

To score points? Are you serious; why would I want to score points and who would I want to score points against? Is there some sort of competition, if so perhaps you can let me know about it?

This is an issue that has got my temper up and some of the idiotic comments on here are not helping it.

This site is becoming like a junior Demonology with all the pettiness but without the..., I was going to say maturity but that's probably not right either.

[Rogue 585]

To score points? Are you serious; why would I want to score points and who would I want to score points against? Is there some sort of competition, if so perhaps you can let me know about it?

This is an issue that has got my temper up and some of the idiotic comments on here are not helping it.

This site is becoming like a junior Demonology with all the pettiness but without the..., I was going to say maturity but that's probably not right either.

I said that I hoped you were not trying to score points because, to me, you seem to be representing a point of view in a way that makes it seem less reasonable than my reading, and it happens that the argument you're representing in this way is the one that has got your temper up.

If you weren't being facetious regarding ignorance of 'point scoring' - something I find hard to believe, given you used to be a Demonology regular - I'm happy to explain it via PM. (To continue this line of discussion in the thread will simply derail it).

If this site is becoming like Demonology it's - at least in part - because of strawman arguments and personal attacks.

[demon3165 2,662]

I said that I hoped you were not trying to score points because, to me, you seem to be representing a point of view in a way that makes it seem less reasonable than my reading, and it happens that the argument you're representing in this way is the one that has got your temper up.

If you weren't being facetious regarding ignorance of 'point scoring' - something I find hard to believe, given you used to be a Demonology regular - I'm happy to explain it via PM. (To continue this line of discussion in the thread will simply derail it).

If this site is becoming like Demonology it's - at least in part - because of strawman arguments and personal attacks.

And your not?

[Red Sox 2]

So from what you say Ned has the right to know the salary of every employee of the club just because he pays a membership?

Is that correct? The pettiness of some people on here amazes me, let's go hammer and tong at each other over a loan that was all above board and forget about discussing the football. Let's make life uncomfortable for the CEO and with a bit of luck at the next Annual Meeting we can embarrass him enough to force him out.

Robbie, it's not like I expected Cam to announce this at the Debt Demolition meeting!

Where do you get 'it's not unreasonable for a member to ask' to me asking for him to be stripped down at an AGM?

Besides, from your point of view he has very little to be embarrassed or uncomfortable about? Or am I misinterpreting you?

[Arrow 1,257]

I spoke to a melbourne player this morning who had no idea that this had happened and was quite shocked taking the general consensus that 'it was probably the wrong thing to do'..

Nothing new just found it interesting, but then again why would the players be told.

[Rogue 585]

I spoke to a melbourne player this morning who had no idea that this had happened and was quite shocked taking the general consensus that 'it was probably the wrong thing to do'..

Nothing new just found it interesting, but then again why would the players be told.

As you say, I don't see why they would know. I don't know that there's much wrong with it, but perception can be important and the perception - as you're suggesting - isn't that flash.

And your not?

To 'score points' I'd need to have a contention, and I haven't argued for or against the loan in this thread. What I did post is my view that the posts of Ned and Demon Hill was more reasonable than was suggested by RobbieF, though. I don't think I've misrepresented anyone's position or resorted to name calling either, so I'm not sure what you're suggesting. For the record, I probably share the view RobbieF has put forward.

To elaborate, I think the important concerns for me would be the corporate governance type questions and the financial ones. It seems the former has been addressed - signed off by Board, MCC, AFL, etc. With regards the latter concern, if we would have just banked/invested that money, earning a rate equal or less than what we're gaining from Schwab's repayments, I don't see that there's much wrong. However, if Louie is right we may have been at some financial disadvantage. On the flip side, there's the argument that it's an investment in a 'Club KPP', as H_T put it.

Regardless, I don't see that there's a problem in members, like Ned, enquiring about the arrangement. As Demon Hill might have been implying, I see it as similar manner to that in which shareholders might ask about renumeration and so forth of CEOs in a public company.

[Sir Why You Little 36,894]

I am waiting for Cameron Schwab to come onto this thread and leave his answer...He is a Demonland reader remember.

[demon3165 2,662]

I am waiting for Cameron Schwab to come onto this thread and leave his answer...He is a Demonland reader remember.

lmfao....oh yeahhhhhhh

As you say, I don't see why they would know. I don't know that there's much wrong with it, but perception can be important and the perception - as you're suggesting - isn't that flash.

To 'score points' I'd need to have a contention, and I haven't argued for or against the loan in this thread. What I did post is my view that the posts of Ned and Demon Hill was more reasonable than was suggested by RobbieF, though. I don't think I've misrepresented anyone's position or resorted to name calling either, so I'm not sure what you're suggesting. For the record, I probably share the view RobbieF has put forward.

To elaborate, I think the important concerns for me would be the corporate governance type questions and the financial ones. It seems the former has been addressed - signed off by Board, MCC, AFL, etc. With regards the latter concern, if we would have just banked/invested that money, earning a rate equal or less than what we're gaining from Schwab's repayments, I don't see that there's much wrong. However, if Louie is right we may have been at some financial disadvantage. On the flip side, there's the argument that it's an investment in a 'Club KPP', as H_T put it.

Regardless, I don't see that there's a problem in members, like Ned, enquiring about the arrangement. As Demon Hill might have been implying, I see it as similar manner to that in which shareholders might ask about renumeration and so forth of CEOs in a public company.

What rules or regulations have been broken here, if everything is above board then then, why the moral carry on because some think it is a wrong thing to do?.

For some three pages of moral judgment on corporate governance when it seems no rules have been broken is a joke, and what is even worse no one knows the facts of the loan they then cast judgment on it.

Instead of show me the money show me the FACTS then I will gladly listen to your points of view.

[jayceebee31 759]

I acyually think it is a great win/win for both Cam & the MFC. Maybe JS & the Board may come up with a similar strategy and offer Tom Scully a proposal to buy accommodation in Melbourne along with his sister. Along with a secure 3/4 year contract. That would indeed be lateral thinking in a very good strategy IMO.

[Dee Fan 3,247]

I said that I hoped you were not trying to score points because, to me, you seem to be representing a point of view in a way that makes it seem less reasonable than my reading, and it happens that the argument you're representing in this way is the one that has got your temper up.

If you weren't being facetious regarding ignorance of 'point scoring' - something I find hard to believe, given you used to be a Demonology regular - I'm happy to explain it via PM. (To continue this line of discussion in the thread will simply derail it).

If this site is becoming like Demonology it's - at least in part - because of strawman arguments and personal attacks.

I'm not quite sure what you're trying to say here so perhaps you can explain it better in a PM. I stopped posting on Demonology over a year ago because I got tired of all the petty arguments and moralising.

BTW do these personal attacks include the ones on CS?

[Range Rover 1,935]

Okay, what's to stop anyone within the club ... from someone in the marketing department to Juice Newton to Todd Viney (citing three random examples) to now seek and receive a loan?

On what grounds would they be refused if they asked and their request seemed reasonable?

Edited March 30, 2011 by Range Rover