Anger grows as Football Index issued new shares in players days before major changes

The troubled online betting firm Football Index continued to “mint” and issue new “shares” in high-profile players just days before an announcement of big reductions in dividends which crashed its market on Saturday. The news is likely to add to the anger and frustration of thousands of Football Index’s customers, who are currently unable to sell their own shares to retrieve money from the exchange without suffering huge losses.

Football Index is a betting site, licensed by the Gambling Commission, but its platform mimics a stock exchange by offering customers a chance to buy “shares” in football players and then paying “dividends” according to their performance on the pitch. Users can also buy and sell shares between themselves using an “order book” system, again similar to one often used on stock exchanges.

Related: Football Index customers furious as terms alterations spark market crash

The value of shares across the exchange plunged on Saturday morning, when the market reopened having been suspended before Friday evening’s announcement that much-reduced dividends would be introduced from early next month.

The firm’s monthly report on the number of shares in circulation, however, shows it sold 15,000 new shares in the eight most popular players on the exchange alone in February and issued nearly 300,000 new shares across the exchange as a whole.

The exchange issued 2,400 new shares in Jadon Sancho to add to 921,509 already in circulation. The Borussia Dortmund player traded at an average price of £7 in February, suggesting revenue for Football Index of £16,800 from the new shares.

In all, taking a player’s average price over the month as a guide, Football Index could be expected to have raised up to £75,000 from sales of new shares in just eight players: Sancho, Neymar, Kylian Mbappé, Trent Alexander-Arnold, Paul Pogba, Bruno Fernandes, Mason Greenwood and Marcus Rashford.

Fresh shares were also issued in several more popular players on the site in February, including Lionel Messi, Erling Braut Haaland and Harry Kane. Football Index continued to issue new shares following an announcement by Mike Bohan, its chief executive, on 18 February that he would hold a Q&A session with the site’s users the following week, to discuss ways to improve its service.

The Q&A, seen by most users as a sign of positive moves to improve liquidity and bring some stability to the platform, was subsequently postponed, and eventually replaced by a market update on 5 March. This revealed Football Index’s new dividend structure, with most dividends reduced to 1p or 2p from a previous maximum of 14p.

The “buy” and “sell” prices of all players dropped dramatically when the market opened a few hours later on Saturday morning. A share in Sancho cost £7.52 on Friday afternoon, but the buy price on Sunday was just 72p.

A spokesperson for Football Index said on Sunday: “When the Q&A was announced, the senior management team hoped we were in a position to continue with dividends at the current level until the end of the season. When it became apparent that this may not be the case, we postponed the full Q&A with the express purpose of not misleading customers while an appropriate route forward could be agreed with our external advisors.

“As soon as the board had agreed a revised plan, on Friday 5 March, we published an extensive written statement addressing the most pressing concerns raised by our customers.”