Manchester City have been found guilty on almost all charges of breaching the Premier League’s financial regulations.
According to reports from The Athletic on Friday 25 September, confirmed by the Premier League the following week, City were found to have breached UEFA’s Financial Fair Play (FFP) and the Premier League’s Profit and Sustainability Regulations (PSR) in all but one of the 115 accused charges. The club is expected to launch an appeal. Although sanctions have not been decided, the club could face point deductions, financial penalties, be stripped of titles, or face expulsion from the Premier League.
City were first charged in February 2023 following a four-year investigation after damning financial reports came to light. Two years after the hearing got underway in September 2024, it seems a conclusion has been reached, although the process is still far from over.
Where does the story start?
See here for a timeline of events.
The German newspaper Der Spiegel published leaked documents in November 2018 (including financial sponsorship records and emails between senior executives) alleging that the club had inflated sponsorship revenues from the state-owned airline Etihad and the state-controlled telecoms company Etisalat. Der Spiegel obtained the communications through Football Leaks – a website set up by Portuguese hacker Rui Pinto to publish sensitive financial and contract information that would not otherwise be available to the public.
The communications alleged that Etihad had only paid £8 million for sponsorship deals worth £35 million, £65 million, and £67.5 million, whilst Etisalat had not paid the £30 million they were obligated to pay across the 2012/13 season, sending the first payment in 2015. The companies also had access to the same state reserves as the Abu Dhabi United Group (ADUG), which holds the majority stake in City Football Group. In layperson’s terms, the club were disguising direct investment from their holding company, ADUG, as sponsorship income by using state-owned companies.
In March 2019, UEFA launched a formal investigation in response to these findings because City had breached the FFP regulations introduced by the organisation in 2011. FFP was introduced to bridge the financial gap between clubs by making spending contingent on earnings. If a club inflates its earnings, it will be entitled to spend more within the regulations, as City are accused of.
An investigation found that a broker named Jaber Mohamed, who was then the Director General of the Crown Prince’s Court in Abu Dhabi, had been employed by Etisalat to move the funds. A UEFA report, which stated that “both Etisalat and ADUG feasibly have access to the same UAE state reserves” and questioned why either of these parties would have needed a broker, was “not answered at any point in the club’s submission and evidence”. Another question left unanswered was how a company could reap the rewards of sponsorship for three years without having paid for it.
UEFA found Manchester City to be refusing to cooperate with the investigation, which they used to establish a pattern of behaviour with the earlier Etihad sponsorship debacle. City’s legal justification for refusing to cooperate with useful information had been that the information had been “hacked or stolen”. The club was banned from the Champions League for two years and fined £30 million. After the club lodged an appeal with the Court of Arbitration for Sport (CAS), the judges ruled that evidence relating to Etisalat was time-barred, as payments had been made outside the five-year period within which UEFA allows prosecution. The ban was overturned and the fine reduced to £10 million.
Freshly published reports by Der Spiegel in April 2022 revealed the Premier League had been investigating the club for three years with new information. The Premier League is not bound by a time period for financial investigations, so that any payments could be subject to review.
What are the charges, and what could they mean?
In February 2023, the league charged City with 115 financial breaches:
- 35 charges of failure to cooperate with investigations between 2018 and 2023 (one not-guilty verdict)
- 54 charges of failure to provide accurate and up-to-date financial information between 2009 and 2018
- 14 charges of failure to provide accurate financial reports for player and manager compensation
- 7 charges of breaching Profit and Sustainability Regulations between 2015 and 2018
- 5 charges of breaching Financial Fair Play regulations between 2018 and 2023
It has since been alleged that the club had secret contracts with managers which allowed them to misreport expenditure. Investigations conducted by Octagon, on behalf of UEFA, found that sponsorship deals from United Arab Emirates-owned companies were overvalued by around £400 million. On Tuesday, the Premier League confirmed that the club had also arranged “sham contracts” to the tune of £830 million in a scheme to disguise secret funding. A report conducted into City’s accounts by PricewaterhouseCoopers found that as much as 84% of City’s “other commercial income” was derived from Abu Dhabi.
Sanctions imposed on other Premier League clubs in recent years set a precedent for a point deduction at a minimum. After Everton were found to have breached PSR restrictions in November 2023, they were given a 10-point deduction, which was reduced to six on appeal, in part due to their failure to cooperate with investigations and overspending. Nottingham Forest suffered a 4-point deduction six months later for similar breaches.
Other affected clubs could also make a compensation case. After Everton’s ruling, the club was ordered to pay £35 million to Burnley for affecting their chances of survival by overspending. City won nine titles during the period under review, which could form the basis for compensation for clubs that narrowly missed out on silverware.
Three of these trophies were Premier League titles, which could be stripped if the league sees fit. Given the sheer amount of charges, a point deduction would need to be severe, and the club may also face expulsion from the league.
Whilst sanctions are yet to be decided, BBC Sport reported on Saturday that there is little appetite within the Premier League for past titles to be stripped from the club.
Manchester City are expected to “try every route possible” to launch a formal appeal. If they do, it will most likely be led by Lord Pannick KC, who helped to overturn the club’s two-year ban in 2020. His reported £ 5,000-an-hour salary is not expected to be a problem, and senior City executives have previously spoken of the benefits of costly representation. During the UEFA proceedings, City chairman Khaldoon al-Mubarak said he would rather spend £30 million on the 50 best lawyers in the world and sue UEFA for the next 10 years than agree to a financial penalty for the alleged FFP breaches.
The Mancunion has approached Manchester City for comment to find out what the club’s next steps will be. In response to the Premier League Commission statement published on Tuesday, the club stated that they were “both disappointed and surprised” and insisted that they were “innocent of the accusations made by the Premier League”.
How does this affect the City dynasty?
Since the case was brought forward, ‘115’ has frequently been referenced in footballing debates, suggesting this verdict will be an asterisk in an otherwise glorious period of Manchester City history.
Arlo, a lifelong City fan and Manchester student, expressed that this decision may hit deeper for some of the older fans than those who have grown up watching a winning team:
“My footballing conscience has only seen success for my club… For someone like my dad, who has [followed the club] since 1976, I would understand a stronger sense of betrayal. My trust in the club is unchanged [and] I personally do not feel betrayed”.
When asked if this affects the City dynasty, he acknowledged the fuel this gives to rival fans, even suggesting that they are late to the trend:
“It’s impossible to argue that people will forget this.”
“We can expect an increase in ‘you cheating b**tards’ chants [but] we’ve been singing ‘City’s going down with a billion in the bank’ for years! It’s only taken the rest of the league 17 years to catch on.”
