PL charge City for alleged breaches of financial rules

[City Raider]

Beyond reasonable doubt you are right but on the balance of probability who knows

And this is why the composition of the panel
Is so important and why the truth isn’t as important as perception

 

[Gordyola]

You are probably right as to how the UEFA nominee how the City nominee voted but we simply don’t know but on that basis what in effect is being said is CAS outcomes are decided on one persons views

The PL panel will be as close to independent as is possible and I like everyone that is expressing an opinion has absolutely no idea as to the strength of the PLs case nor is it remotely possible to second guess how the panel will reach the point on the balance of probability but and here’s something that I hadn’t thought about till it was mentioned yesterday everyone attending, and probably giving evidence, will have English as their first language and will be experienced in and mainly trained in English law as opposed to Swiss .

Put all that together and, well I am back where I started !

The legal panel in the CAS City v UEFA case were, with one exception, not Swiss lawyers
President: Rui Botica Santos Attorney-at-Law Lisbon Portugal
Arbitrators:
Andrew de Lotbiniere McDougall QC Attorney-at-Law Paris France
Ukrich Hass Professor of Law Zurich Switzerland
Ad hoc Clerk Dennis Koolaard Attorney-at-Law Arnhem the Netherlands

City's legal team were mainly from UK with four Swiss and two from Spain
UEFA's One Swiss and the other UK

 

[Maly]

Yep. And in HMRC, and on fiscal issues around overseas income and image rights. Seems relevant to me.

Must be Simon Jordan

 

[BamberBridgeBlue]

Very true, but I only asked for the 'smallest', 'slightest' bit of proof.
My comment was that some are only too willing to outrightly dismiss the PL charges as being unfounded I.e. without evidence but are only too willing to believe an outright rumour that also has no evidence.

thankfully we have Lord Pannick to represent City and not me :-)

I agree but it’s still about opinions and I suspect interpretation of evidence. You are asking for facts which I suspect are very thin on the ground anywhere. My opinion is that if there were smoking gun evidence to be had, it would be in the interest of Der Speigel, Teabag, Barcelona, American owned Premier League clubs etc for that evidence to be writ large in public. But it isn’t. So my opinion, based on no facts, just like you is that the evidence is flimsy and circumstantial.

 

[CC1]

Of course it is fact that targets shape behaviours . Clubs will no doubt push the boundaries it’s why most claim Chelsea offered such long contracts to many of the recent signings but based on the rules in place at the time they have to be allowed but the rules change.
Did City work within the FFP rules or did they not just bend them but broke other rules to present a picture that was intended to comply with FFP targets? That really is the question
Its akin to which comes first the chicken or the egg?

You just keep hypothesising- usually to the detriment of OUR club. When you actually have any facts we’ll be interested but as it’s all - quite rightly- being kept private by club & PL because they’re undertaking an investigation (in case you weren’t sure) you’re unlikely to know any more than me or any other City fan & I for one, don’t care about a Chelsea fan’s views on the matter because you’ve got away with cheating for years

 

[tolmie's hairdoo]

I do think Terraloon has made a very salient point.

The Premier League are following up those areas Uefa, for whatever reason, chose not to ask for?

 

[Prestwich_Blue]

The initial purpose of FFP was said to stop clubs building up debt that they couldn’t service . Somewhere along the lines the concept turned around to potentially do the exact reverse.

Indeed RA choose a way to inject capital into Chelsea but the debt to him grew all within FFP allowances but as we saw as soon as some thing happens to the owner that debt is the issue irrespective of how soft the loans are

Had the rule simply been something along the lines that debt to owners exceeding say 10% of averaged turnover had to be turned into equity then that would have made far more sense than allowing debt to grow and restricting wealthy individuals to do what they want with their own money.


Yes I was involved with a non league club , indeed there are far non league semi pro clubs than there are clubs in the PL and EFL. Those clubs are riddled with debt.

Take a moment to look at the accounts posted on companies house of the likes of Notts County or Southend (well Southend are a real basket case and are some years in arrear of posting accounts ) debts .
Look at Bath Citys indebtedness to their parent company.Ok these clubs aren’t as big as City as Chelsea and aren’t likely to play in European competitions but they are far just as important to their supporters and UEFAs version of FFP has done nothing to protect these clubs and it should

Excellent post overall but I'd point out that there are no "FFP allowances" as far as debt is concerned. You can have as much as you like (Chelsea had £1.6bn) but as long as it's a soft loan, or (like united) you can service commercial debt, it doesn't come into play.

But you do seem to understand that FFP (as it was from 2010 till last season) based on historic net profit, is a really poor vehicle for assessing financial sustainability. Clubs generally fail because they can't pay creditors, who might include banks or other financial institutions. But it could just as easily be HMRC, suppliers of goods and services, or former owners. That's an issue of cashflow and is what nearly brought us down in the summer of 2008.

The new system is a bit better but not much. A true test of financial sustainability would involve looking at future liabilities and assessing those against expected cash flow, which is what La Liga does. Tebas may be a fascist & racist slug, but he's mostly got the financial monitoring stuff right.

 

[Centurions]

Hmmm, 300 players you say! isnt that the size of our current squad according to the media and other wankers?

.......and just in case we didnt get your gist you use the phrase "satellite clubs".

From what I remember (this was reported a good while back) that's the exact way it was phrased. The wording isn't his. Most if not all PL clubs have "satellite clubs", it doesn't automatically mean us (in fact I doubt it is us in that respect at least).

 

[Centurions]

It really is mate. For starters, your assumption that everyone attending & giving evidence are likely to all have English as their first language is completely incorrect

Khaldoon as Chairman may give evidence & I’m pretty certain he’ll be attending

Ferran Soriano as CEO may give evidence & again, pretty certain he’ll be attending too

Neither speak English as their first language, so how can it possibly be relevant that everyone attending & giving evidence will have English as their first language, when that’s not even true?
Maybe an Etihad rep, or Eiselt rep, or Mancini will give evidence. Will they all have English as a first language? Nope

No idea what your point about English & Swiss law is, unless you’re alluding to the fact that CAS is based in Switzerland & if it were based in the UK, we wouldn’t have won?

However, guessing you have no idea that the arbitrators & clerk for the CAS case were from Portugal, France, Switzerland & Holland? Or that UEFA used barristers from UK AND Switzerland? Or that English, French & Spanish are the 3 languages used at any CAS case?

CAS isn’t a kangaroo court mate, so what difference do you envisage this panel of 3 of English speakers, with at least one of the panel being a UK trained lawyer, will make?

Edit: Forgot the most important part: No evidence was the verdict at CAS for all charges brought within time & it doesn’t matter what language you speak, or what country you studied law in, no evidence means no evidence

You write well mate, but you know the square root of fuck all on this subject ya dirty cockerney twat ;)

At least you didn't call him a rag :)

 

[petrusha]

Here's a question. The UEFA charge was that the club disguised equity funding as sponsorship income and as a result our signed, audited accounts were not complete or accurate (I suppose they mean true and fair).

Edit: Sorry that was half a question. This is the rest.

Never mind. It's late :) Will try again tomorrow

:D

I had to go offline last night as my wife's ill at the moment (nothing unduly worrisome, thankfully) and needed some care and attention. Did you post the question? I haven't seen it, but if I've missed it, please flag it for me and I'll answer it as best I can.

This gets incredibly confusing but under FFP article 47 ( which CAS refer to ) clubs don’t actually submit accounts. They submit a whole host of financial information which is independently audited.

CAS refer to note 4 that has to be the note attached to the Financial Statement which isn’t the note mentioned in statutory accounts. We know that because if you look at note 4 of Cities accounts that note is all about directors remuneration nothing to do with income .
Not every country that is affiliated to UEFA will submit accounts in the same format or indeed has to supply the same information so its not really surprising that Company Accounts aren’t the source of FFP financial information


Article 47 – Annual financial statements
1 Annual financial statements in respect of the statutory closing date prior to the deadline for submission of the application to the licensor and prior to the deadline for submission of the list of licensing decisions to UEFA must be prepared and submitted.
2 Annual financial statements must be audited by an independent auditor as defined in Annex V.
3 The annual financial statements must consist of:
a) abalancesheet;
b) aprofitandlossaccount;
c) a cash flow statement;
d) notes, comprising a summary of significant accounting policies and other explanatory notes; and
e) afinancialreviewbymanagement.

Your interpretation of false accounting is interesting and bears merit. If you are right then City simply can’t loose the case because without doubt if false accounting accusations follow then you can see your owners and or directors being banned from owning the club and or being directors even under the current poor rules

As I understand it, the submission under article 47 essentially comprises largely the same information as is contained in the audited accounts, adjusted as necessary for FFP purposes. And the independent auditor is the same one who audits the club's annual accounts. On that basis, I've assumed that UEFA's allegations regarding the way sponsorships are dealt with in the documents submitted for FFP purposes would also entail the audited annual accounts not being true and fair.

Your reference to Note 4 as mentioned in the CAS Award is interesting. It actually suggests that it might have been possible for financial submissions to UEFA to be incorrect and incomplete, as was alleged, while the audited annual accounts remained true and fair. We can't analyse that further without knowing more about what note 4 contains, but it's a possibility I hadn't previously considered and it makes more sense of the position of some posters on here.

However, it doesn't make any difference to the issue of whether City's alleged conduct amounted to the club's directors potentially having committed the offence of false accounting. Under section 17(1)(a) of the Theft Act 1968, the offence is committed when someone falsifies "any account or any record or document made or required for any accounting purpose", and that seems clearly to me to include FFP submissions to UEFA.

It's also worth pointing out, not particularly in response to you but in view of many statements on here, that what constitutes conduct that's fraudulent in nature doesn't depend so much on what was done but on how and why it was done. If UEFA had characterised City's alleged breaches as having been committed unintentionally, possibly as a result of incorrect professional advice, there could be no allegation of false accounting.

Instead, they expressly stated that City dishonestly tried to conceal the club's true income, thereby deceiving UEFA into allowing the club to spend more money (to the tune of an annual £50 million) on player transfers and wages than the FFP rules allowed. It's the imputation dishonesty and intentional deception with a view to gain (not necessarily one's own) that's crucial in terms of making the allegations in effect ones entailing conduct that, if committed, amounted to a fraud-based criminal offence.

For another illustration, let's use the example of Al Jazira paying Mancini under a contract for services. There's no imputation of potentially criminal conduct if the contention is simply that City should have notified the Premier League of an arrangement between the club's manager and a related party owned by the major shareholder, but failed to do so owing to either an oversight or a misunderstanding of the rules.

On the other hand, if the contention is that the club deliberately concocted a scheme to pay Mancini extra salary off the books under a sham contract with a related party and intentionally concealed the arrangement, such conduct, too, seems to me to fall clearly within the definition of false accounting. Even if, for whatever reason, a prosecution would be unlikely to follow were the allegations to be borne out to the civil law standard of proof, that doesn't change the nature of the alleged conduct.

It's worth reminding ourselves of the PL's wording in its publicly declared statement of charges against City. In particular, I note that we're alleged, in respect of nine successive seasons ending in 2017/18, to have breached "the Premier League Rules applicable in those seasons that required provision by a member club to the Premier League, in the utmost good faith, of accurate financial information that gives a true and fair view of the club’s financial position, in particular with respect to its revenue (including sponsorship revenue), its related parties and its operating costs".

I find it hard to see how, IF we were indeed guilty of that charge, City could have failed for almost a decade to provide "in the utmost good faith, ... accurate financial information that gives a true and fair view of the club’s financial position, in particular with respect to its revenue (including sponsorship revenue)" without conduct taking place that amounts to false accounting. Surely dishonesty and deception would have to be involved for there to be nine years of continual breaches of rules requiring us to provide information that "gives a true and fair view of the club's financial position", at least in relation to some matters (sponsorship income, for one, which is expressly referenced).

This is important because it has a bearing on the standard of proof to be applied. Under PL rules, the standard of proof to be applied by the PL's Panel is the balance of probabilities. In other words if they're going to find City guilty they need to be satisfied that the PL's charges are more likely than not to be true.
'
However, as I've discussed earlier in this thread and as other lawyers have mentioned, there's a well established principle in English law, supported by an extensive body of relevant case law, that particularly cogent evidence is required to justify a finding of fraud or other discreditable conduct. As a matter of theory, this doesn't change the standard of proof from the balance of probabilities. However, in effect, many practitioners regard it as creating a higher bar in cases where such conduct is alleged.

This is, in my view, an important factor in City's favour. To the extent that the charges involve dishonesty, and thus more serious consequences should we be found guilty, the PL faces a far from an easy task in terms of substantiating its case to the necessary standard of proof. To the extent that the charges don't involve dishonesty and deception, one can reasonably infer that, even with a guilty finding, the more extreme kinds of punishment mooted in the media won't be justified.

EDIT to remove erroneous analysis of the prospects of an appeal to the High Court.