Man City found guilty of 'sham' contracts and misleading accounts, Premier League says
Manchester City have been found guilty of all charges relating to breaches of Premier League financial rules between the 2009-10 and 2017-18 seasons, the Premier League announced on Tuesday, 29 September. An independent commission concluded the club arranged “sham contracts” to disguise more than £830.69m of funding and misstated accounts; the club continues to deny wrongdoing.
The commission's published, redacted report said the charges “concerned well over 100 alleged individual breaches of Premier League Rules across four broad charge categories” and arose from arrangements spanning nine seasons. News that the club had been found guilty of breaking the majority of the 115 financial rules they were accused of breaching emerged last week, and the League made the commission's opinion public on Tuesday.
The report described the commercial deals as part of a “disguised funding scheme” to the scale of £830.69m, saying: “The relevant sponsorship agreements were found to be shams, or at minimum did not reflect their economic substance.” It added there was “deliberate or reckless conduct intended to circumvent the Premier League rules” and that the scheme allowed the club “to avoid recording what would otherwise have been the largest single-season loss in Premier League history in 2009-10”.
The commission found that some sponsors paid only part of agreed fees, with the remainder provided by the club’s owners, and recorded other arrangements that reduced reported operating expenses. According to the Premier League, some of City’s commercial deals formed part of a disguised funding scheme involving Abu Dhabi United Group Investment & Development Ltd (ADUG); the commission also described a separate Fordham arrangement as a “sham circular arrangement” funded by ADUG.
Richard Masters, chief executive of the Premier League, set out the League’s position in a statement: “The core decision establishes the facts of what happened at Manchester City during this period. It details how the club systematically broke Premier League Rules for nearly a decade. It also vindicates the Premier League's decision to pursue this case against Manchester City. While the process to date has been both long and difficult, the League has remained determined that the facts be established independently. It is a key responsibility of the Premier League to ensure that the Rules, approved by the clubs themselves, are upheld to protect the integrity of the competition. It is paramount that the League remains competitive and fair for all clubs and for the fans. We take that role extremely seriously.”
The Premier League said the question of sanction “will be addressed separately in a further hearing with the independent commission” and that under its rules possible penalties include fines, points deductions and other sporting sanctions. The League added that the sanction hearing must remain private and confidential and that the club has the right to appeal the commission's findings.
Manchester City issued a statement in response: "Manchester City FC is both disappointed and surprised by the opinion of the Premier League Commission, that has been published today. The Club is innocent of the accusations made by the Premier League and a comprehensive body of irrefutable evidence exists in support of all of its positions, relating to this case. The Club will therefore be relentless, and where necessary proactive, in any and all appropriate regulatory and legal forums." Lisa Nandy, the Culture, Media & Sport secretary, told the BBC: "It's incredibly serious, the Premier League report is incredibly stark. This is causing a lot of concern for Man City fans and all fans of Premier League football."
The commission established the breaches, but any disciplinary measures will be decided in a separate hearing and remain confidential under Premier League procedures; City have the right to appeal and have until Friday 2 October to submit their appeal.
