Manchester City found guilty of systemic financial rule breaches
An independent commission has found Manchester City guilty of a series of serious financial rule breaches, concluding that the club engaged in a long-term scheme to mislead the Premier League. The ruling, which spans several seasons, details how the club’s owners, the Abu Dhabi United Group, orchestrated complex arrangements to artificially inflate commercial revenue and conceal the true extent of their financial commitments.
The disguised funding scheme
At the heart of the findings is what the commission termed a disguised funding scheme. Between the 2009-10 and 2017-18 seasons, the club reportedly hid more than £830 million in sponsorship funding. The scheme involved sponsorship agreements split into a base fee and a "tagged sum," with the latter being paid directly by the club's owners rather than the sponsors themselves.
This mechanism allowed the club to report commercial revenues far exceeding their actual market value, effectively bypassing Financial Fair Play (FFP) regulations. The commission rejected the club's defense that the Premier League had misunderstood these agreements, labeling the explanation as "untrue" and "concocted" to obscure the reality of the funding.
Project Longbow and the Fordham Arrangement
The investigation also scrutinized Project Longbow, an initiative launched in 2012 intended to boost revenues. While the commission acknowledged that some elements of the project were legitimate, it identified the Fordham Arrangement as a "front." This device allowed the club to receive funds from owners disguised as operating income by artificially inflating the price of players' image rights.
Additionally, the club was found to have moved significant remuneration costs off its books. By paying wages through third parties, the club concealed its true liabilities, including millions in payments to players and managers that were ultimately funded by the owners.
Integrity of evidence and witness conduct
The ruling includes a scathing assessment of the club's cooperation during the investigation. The commission stated that Manchester City made "concerted efforts" to frustrate the inquiry and that several important witnesses provided evidence they knew to be false. The panel concluded that the club failed to act with the "utmost good faith" required by league regulations.
According to the Premier League, these actions resulted in annual accounts that did not provide a true and fair view of the club's financial position. As the investigation continues, the findings raise significant questions regarding the integrity of the individuals involved, particularly as a new Independent Football Regulator prepares to oversee the governance of English football.
