Manchester City are in troubled waters as the Premier League has confirmed that City have been found guilty of all charges related to breaches of Premier League financial rules between 2009-10 and 2017-18.
An independent Commission found that during that timeline, the team arranged “sham contracts” with a number of its commercial partners, as well as “relying on sham agreements to artificially inflate the club’s revenues and reduce its costs”.
The statement further stated that Manchester City were guilty of the majority of charges in relation to its failure to co-operate, but an exact figure was not given.
relation to the ‘sham’ contracts, the Premier League statement says: “The independent Commission found that Manchester City arranged ‘sham’ commercial deals with a number of its sponsors during the period, which were part of a disguised funding scheme, whereby those companies were only required to pay a portion of the relevant sponsorship fees. The remainder was funded by Abu Dhabi United Group Investment & Development Ltd (ADUG), which owned the club. As part of the scheme, further ‘sham’ arrangements, funded by ADUG, were entered into to enable the club to record lower operating expenses than it actually incurred, as well as a ‘sham’ circular arrangement with Fordham, an entity that purchased the club’s players’ image rights, that was funded by ADUG.
“The purpose of these schemes was found to have been to artificially inflate the club’s revenues, and reduce its costs, by more than £900 million during the affected period, to appear to comply with financial rules. The consequence of this, as the Commission found, was that the club filed misstated accounts and concealed the true state of its finances from its auditors and football regulators. The Commission concluded that ‘by its conduct the club clearly intended to circumvent the PL Rules’.”
The sham commercial deals were described as being part of a “disguised funding scheme” to the scale of £830.69m.
