Council has not recovered any of the Â£10.25m Northampton Town loan despite spending 'large proportion' of Â£950k fighting fund
Urgent calls are being made for Northampton council chiefs to reveal how the legal battle to recoup the missing Sixfields millions is fairing- after a report stated the authority had spent Â£950,000 with no success.
The borough council loaned more than £10 million to the Cobblers in 2013 and 2014 to complete a stadium expansion.
But the work was never completed and the whereabouts of the funds has been the subject of a police investigation since officers removed files from Sixfields Stadium in a dramatic swoop in November 2015.
The council also launched a legal battle to recoup the money loaned to the club, more than £8 million of which was passed onto Hertfordshire development firm 1st Land Limited through 2013 and 2014.
The council wrote off the loan to the Cobblers when Kelvin Thomas took over the club in November 2015 and received cabinet approval to set aside £950,000 for legal fees to chase the money.
A report by auditors KPMG has now revealed that, from the £950,000 authorised, the authority has 'spent or committed a large proportion to date'.
"Despite this," it continues, "the authority has not had any success in recovering the lost monies."
Shadow cabinet member for finance on Northampton Borough Council, Councillor Clement Chunga, says the Conservative administration needs to give an immediate update on the authority's legal battle.
He said: “It is not good that the borough council has spent a large proportion of the £950,000 and so far doesn’t have anything to show for it.
"It is unclear how the borough is now going to try and get the money back.
"We need urgent answers from the Conservative administration in how they intend to do this.
"It is understandable that the borough council want to try and get some of the money back but it is important to ask whether this is a realistic prospect.
"There is no point just spending more money on lawyers if at the end of the day you don’t get anywhere.
"My fear is if the council does eventually get a small proportion back then this will be outweighed by the legal costs and costs of senior council officer time spent on the issue.”
The council is yet to state whether it intends to continue pursuing the lost loan money, citing 'commercial sensitivity' as its reason.
Back in March, the council was told that its bid to reclaim £180,000 from former Cobblers chairman David Cardoza would have to involve it winning an expensive High Court trial.
The former chairman paid himself that amount as a salary between January and August 2015, when the council claims he knew the football club was all but insolvent.
But a High Court judge ruled Mr Cardoza had enough evidence to argue against the council’s claim in a civil trial - and in fact had loaned the club £5.2 million during his time in charge.
The judge's ruling prompted former Conservative MP Brian Binley to call on the council to 'cut its losses' and abandon its pursuit of the funds.