John McGrath shuts down speculation about using company money to fund gambling habit

Controversy surrounding McGrath Real Estate (ASX: MEA) founder John McGrath's alleged $16 million gambling debt has been addressed by McGrath himself in a letter to the ASX.

The statement, released to the ASX by McGrath Real Estate, sees McGrath denying the claim that he has been using company money to fund his expensive gambling habit.

McGrath admits he has an account with a bookmaker but says the account is not secured by his shares in the company.

The full statement is below:

"I am a person who values my privacy, and generally seek to avoid commenting publically on adverse media relating to me. However, the ridiculous recent press coverage seeking to link matters which are personal to me with McGrath Limited is distracting attention from the important work of the Company, to a point where I have concluded I need to make a statement to clear the air.

Like many Australians, I enjoy a punt. I have a credit account with a bookmaker for this purpose. That account is not secured by, or otherwise connected with, my shares in the Company. The account is well within my means in the context of my net wealth. I am in full compliance with the terms of that account. I have never, and would never, let what I choose to do in my personal time impact upon the Company.

I dedicate more than 60 hours per week to my work for the Company I founded 30 years ago. I thank the great team at the Company for their support at what has been a personally challenging time for me. I will continue to focus my energies on the important work of improving performance, growing the Company and restoring shareholder value. I do not intend to comment further on this personal matter."

This statement from McGrath follows yesterday's release of his company's half year results. During the first half the company posted a loss of $25.5 million.

The initial controversy surrounding John McGrath stems from media speculation that McGrath is in debt to gambling company William Hill Australia to the tune of $16.2 million.

It was later alleged that McGrath was using a $100 million lending facility attached to his real estate business that was potentially funding his gambling habit.

Shares in McGrath remain in a trading halt.