Northampton Borough Council agrees a further £500k to chase Cobblers cash

A further £500,000 has been earmarked by Northampton Borough Council in its bid to recover the £10.25m it loaned to Northampton Town Football Club.

It lent the club funds in September 2013 towards the redevelopment of its Sixfields Stadium.

A criminal inquiry is under way into "alleged financial irregularities" surrounding the council's loan to the club, known as the Cobblers.

Council leader Mary Markham said she was committed to recovering the money.

The authority has already spent £450,000 on legal issues including retaining forensic accountants to work out where the money may have gone.

It is hoped all the costs will be recovered from the ongoing action to trace the money and from redevelopment of land at Sixfields.

The money was loaned to the football club to increase capacity at the stadium and build housing, a hotel and retail units.

Failed repayments

Work started in early 2014 but the plans were soon downgraded and by September 2015 it was found the club had failed to make repayments on the loan.

High Court papers contain allegations developer Howard Grossman and his associates used a "substantial part" of the money for unrelated purposes.

The allegations about County Group, the trading name of companies owned by Mr Grossman, were made in papers filed at the High Court in November 2014. Mr Grossman denied the allegations.

The League Two club had initiated legal action to establish what had happened to the loan money and to try to recover it after contractors were not paid. The claim was settled out of court and the parties signed a non-disclosure agreement.

Ms Markham said she had committed to the people of Northampton to "go after the people who spent our money" and "bring them to justice and to recover that money".

"I would not be putting almost £1m into this process if I did not feel that we were able to recover a substantial amount of money from the people involved."

She said she might not need to spend all of the £500,000 that had been approved, which is coming from the council's reserves, but she would need it to be available.