Financial Fair Play

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UEFA begins Financial Fair Play investigation of Man City

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UEFA has opened a formal investigation into Manchester City regarding a potential breach of Financial Fair Play.

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City was sanctioned in 2014, but that punishment was later eased by UEFA.

From UEFA.com:

The investigation will focus on several alleged violations of FFP that were recently made public in various media outlets.

UEFA will make no further comments on the matter while the investigation is ongoing.

Here is Man City’s statement:

Manchester City welcomes the opening of a formal UEFA investigation as an opportunity to bring to an end the speculation resulting from the illegal hacking and out of context publication of City emails. The accusation of financial irregularities are entirely false. The Club’s published accounts are full and complete and a matter of legal and regulatory record.

Guardiola admits sanctions possible over Man City finances

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LONDON (AP) Manchester City manager Pep Guardiola raised the prospect Friday of soccer authorities punishing the Premier League champions over attempts to circumvent financial fair play rules.

City is leaving Guardiola to field questions about the leaked internal correspondence published by European media outlets, while executives decline comment. The club has not disputed the authenticity of internal messages showing how it used companies linked to the Abu Dhabi ownership to boost revenue in an attempt to curb losses and comply with UEFA regulations.

“If there’s something wrong we’ll be punished,” Guardiola said at a news conference ahead of Sunday’s derby against Manchester United.

City, which has been owned by Abu Dhabi’s Sheikh Mansour for a decade, was punished by UEFA in 2014 for breaching the “Financial Fair Play” program. The settlement agreement eventually saw the club only forfeit $23 million in Champions League prize money. UEFA this week has not said how aware it was of City’s schemes, reported by German magazine Der Spiegel, to hide expenses and evade monitoring of spending on players.

“At the end, UEFA, FIFA, English federation has to say if we were wrong,” Guardiola said. “If we were wrong (we) will accept it but I hear what my club said to me and I trust a lot of them.”

There was no response to an email sent to three City media officers seeking comment on Guardiola discussing the possibility of the club facing further punishment. City did, however, send an emailed statement announcing a new contract through 2023 for winger Raheem Sterling on Friday.

City has also not responded to questions from The Associated Press about Guardiola’s contract, specifically whether he receives income from entities in Abu Dhabi or other teams owned by Sheikh Mansour. The Football Leaks group published details showing how Roberto Mancini, who managed City from 2009 to 2013 and won the Premier League title in 2012, received more pay from a team Sheikh Mansour owns in Abu Dhabi to work as a consultant than from the Manchester club.

City has faced a week of damaging headlines about its conduct and financial arrangements since the first leaks were published a week ago.

Der Spiegel showed how the team’s holding company – state-backed Abu Dhabi United Group – sent cash to a shell vehicle which was created to supposedly buy the right to use players’ images in marketing campaigns. This helped turn almost $34 million into revenue instead of a cost, for the purpose of UEFA’s investigation of club accounts as the club tried to avoid being banned from European competitions for overspending.

While City said it “will not be providing any comment on out of context materials,” Guardiola was more open to discussing information related to the Football Leaks investigation. Real Madrid was revealed to be working with consultants on a 16-team Super League to kick off in 2021, effectively replacing the Champions League and outside the control of UEFA.

“I would like to know the ideas,” said Guardiola, who is in his third season coaching City. “But, for me, the Premier League, local leagues, are so important, with all the history.”

UEFA re-opens FFP investigation into PSG

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Paris Saint-Germain thought they were in the clear, but UEFA has re-opened its investigation into the oil-rich Ligue 1 club.

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After previously clearing the club of breaking financial fair play (FFP) rules in June, UEFA said in July that it would follow up by looking deeper into the findings of the Club Financial Control Body (CFCB). Upon doing so, UEFA announced this week that it would be handing the case back to the CFCB “for further investigation.”

UEFA’s statement read as follows on Monday:

“Following the decision of the chief investigator of the CFCB to close the investigation into Paris Saint-Germain, and the subsequent decision of the CFCB chairman to send it for review by the CFCB Adjudicatory Chamber, the latter decided on Sept. 19 to refer the case back to the CFCB Investigatory Chamber for further investigation.”

The majority of the investigation likely focuses on the transfers of Neymar ($262 million) and Kylian Mbappe ($208 million, via loan) in the same summer. Whether or not the club can show enough income to cover its massive transfer fees — the two largest in the history of the sport, in this case; not to mention, the legitimacy of various revenue streams — has been a murky ongoing plot since Qatar Sports Investments bought the club in 2011.

Birmingham City under transfer ban after Redknapp’s failed spending spree

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Harry Redknapp‘s poor last decade has hit another club, this time off the field.

Birmingham City is under transfer ban from the English Football League for running afoul of Financial Fair Play after their efforts to overturn their temporary ban fell flat on Monday.

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The club says it will continue to pursue a resolution that will allow it to add more players before the season, something respected new Garry Monk would sure appreciate, okay?

Redknapp, now 71, promised the green fields of the Premier League and got the club to spend $22 million on new players with just $6 million going out the door (Transfermarkt).

Birmingham went 1W-1D-6L in its first eight matches of the season, firing Redknapp. It finished the season in 19th place, flirting with relegation the whole way.

From BCFC.com:

The Club has spent several months working diligently to satisfy the EFL.

Unfortunately and disappointingly the EFL are currently refusing to allow us to make additions which would enable us to strengthen the Manager’s squad.

QPR to pay $55 Million Financial Fair Play penalty

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The other shoe finally dropped in the English Football League’s case against Queens Park Rangers regarding Financial Fair Play.

QPR on Friday agreed to pay a $55 million fine to the EFL, with payments spread out over the next ten years, for breaching Financial Fair Play rules in 2014 as the club made its push to return to the Premier League. QPR also agreed to pay all the court costs – as part of the $55 million settlement – and are banned from signing new players in the January 2019 transfer window.

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Ahead of the 2013-2014 season, QPR spent lavishly, signing the likes of Charlie Austin, Matt Phillips and Karl Henry, in addition to a first-team squad that already included Loic Remy, Ji-Sung Park and Adel Taraabt (all three would go out on loan). Ultimately, QPR’s nearly $100 million wage bill represented 195 percent of of the club’s revenue. Over a three-year period, Financial Fair Play regulations in the Championship state a team cannot lose more than $17 million per season.

Of course, while Financial Fair Play rules were put into place to keep clubs from overspending and harming their future, if QPR’s board and group of owners could afford to write off the costs and cover it from their other business assets, then as long as the club is in good shape, perhaps there shouldn’t have been a penalty.

In any case, it was probably worth it for QPR. Austin’s 18 goals helped drive QPR back into the Premier League, and despite lasting one season, the television and parachute payments are still keeping the club afloat.