The High Court of Justice for England and Wales has set 19 May to 21 May as the date for the hearing regarding the distribution of funds from Football Index’s player protection account.
There is currently a balance of £4.5 million in the player protection account, although £3.2 million is owed to customers who still have money in their Football Index accounts, leaving the operator with a £1.8 million surplus.
The main challenge left for both administrators and the courts is to establish the cut off date for from which cash balances should be paid, having been left with three options – the date the platform was suspended on 11 March, the date when parent company BetIndex entered administration on 26 March, or a later date than either.
Furthermore, in addition to owing money to former customers with ongoing account balances, some users are still owed dividends by the company – profits made from investing in football players via the trading exchange platform.
Begbies Traynor’s opening claim’s process, beginning in April, was open to all former Football Index customers, including those who had previously self-excluded via Gamstop.
If a cut-off date for the payment of dividends is not determined, Football Index will be liable to pay a further £550,000 per week at the current rate, leaving it in default by 22 April.
If a later cut-off date is set, customers who still have active bets on the platform would benefit the most, as this would entitle them to a greater share of the funds through winning dividends.
The case was initially taken to the High Court on Wednesday, shortly after BetIndex insolvency practitioners Begbies Traynor initiated the hearing on Monday, where it was expected to be heard by the Insolvency List at the Business and Property Courts of England and Wales.
Begbies Traynor had called for the courts to hear the case as soon as possible, citing stress caused to customer’s as a result of the collapse of Football Index, due to some losing hundreds of thousands of pounds in investments and dividends.
The demise of the football trading exchange was triggered by a mass withdrawal of customers due to its decision to cut dividends on players from 14p to 3p, resulting in many customer’s winnings on the site dropping significantly.
Significant criticism has been levied at the UK Gambling Commission (UKGC), which was accused of acting too late in suspending Football Index’s gaming licence the day after the collapse, whilst the DCMS has conducted an independent probe into the events.
Additionally, some customers have sought the representation of law firm Leigh Day, which confirmed that an investigation of the UKGC’s actions regarding Football Index will constitute a core part of its legal case.
BetIndex is still hopeful that its trading platform could be resurrected in a ‘restructured form’ in time for the 2021/22 football season.