PL charge City for alleged breaches of financial rules

[Rory Bluelow]

You're right, these charges have huge implications, if proven this is fraud on a massive scale, we're talking criminal charges here. There's no way the PL have the evidence to prove any of this, not to the level required, they've painted themselves into a corner here, it'll be interesting to see how they extricate themselves.

I expect Masters will be the fall guy and get the elbow and they’ll announce an internal investigation and a review of procedures.

 

[The perfect fumble]

Right so it’ll quite clearly be a related party transaction. Like I said, plenty of owners do that, they’d be stupid not to tbh. I still don’t get the point the guy was making, it’s not a comparable to us.

An owner wants to invest in his club, but he can only invest what the club generates in revenue, what the club generates in revenue falls short of what the owner wants to invest, so he increases revenue by getting another company he owns to sponsor the team, and then he uses that sponsorship money to invest in the club.

It's called disguising equity as revenue.

 

[The perfect fumble]

I expect Masters will be the fall guy and get the elbow and they’ll announce an internal investigation and a review of procedures.

That will be a sweet day.

 

[LeonardoDaVnci]

I only come on this thread to ask the same question. Does anyone have any idea when this saga is coming to an end. How long can an investigation last?

We don't know, we can only infer how long it will take. If you read CAS you can see the level of detail the UEFA lawyers went down to, ie they scrutinised selected transactions over a limited time. The PL charges relate to 10 years of finanancial reporting and the investigation took 4 years to complete.

I posted this "simulated" scenario re Etisalat....

Maybe the PL witchhunt works like this, the PL lawyers scrutinise every single sponsorship financial transaction from all MCFC bank accounts (in chronological order) to drive the case.

So for example, 01/04/11 MCFC received a payment of £15M into the clubs current account. The "PL" believe this was sent by the owner of MCFC as disguised equity funding and was concealed in the annual accounts ie reported as sponsorship funds from Etisalat and therefore is a breach of PL rules. So in defence MCFC provide documentary evidence proving the sponsorship agreement between MCFC and Etisalat, call on executive officers of both parties to corroborate the agreement and provide evidence from the banks of the sender of the funds. So where does the argument go then ?, the PL lawyers have only one option ie to accuse the defence of dishonesty during the hearing. So then the PL lawyers could spend copious amounts of time discussing the integrity and honesty of the witnesses, the sponsors, accountants, auditors and the MCFC legal advisors throughout the ten year period.

 

[cheekybids]

We don't know, we can only infer how long it will take. If you read CAS you can see the level of detail the UEFA lawyers went down to, ie they scrutinised selected transactions over a limited time. The PL charges relate to 10 years of finanancial reporting and the investigation took 4 years to complete.

I posted this "simulated" scenario re Etisalat....

Maybe the PL witchhunt works like this, the PL lawyers scrutinise every single sponsorship financial transaction from all MCFC bank accounts (in chronological order) to drive the case.

So for example, 01/04/11 MCFC received a payment of £15M into the clubs current account. The "PL" believe this was sent by the owner of MCFC as disguised equity funding and was concealed in the annual accounts ie reported as sponsorship funds from Etisalat and therefore is a breach of PL rules. So in defence MCFC provide documentary evidence proving the sponsorship agreement between MCFC and Etisalat, call on executive officers of both parties to corroborate the agreement and provide evidence from the banks of the sender of the funds. So where does the argument go then ?, the PL lawyers have only one option ie to accuse the defence of dishonesty during the hearing. So then the PL lawyers could spend copious amounts of time discussing the integrity and honesty of the witnesses, the sponsors, accountants, auditors and the MCFC legal advisors throughout the ten year period.

That’s the sort of thing I’d have been asked in an audit & got 4 hours to show. If a non-conformance was raised I’d have had another 28 days.

The sheer volume mattered didley….

 

[WRicko]

Absolutely not attacking you or City. If anything I'm defending Wrexham using exactly the same arguments I would use to defend City
- that, if the sponsorship is not with a related party then what's the issue? The sponsor must feel it's worth it to them.
- if it is with a related party, then is it at market value? If it is, then again, what's the issue? They're allowed sponsorship with a related party if it's at market value.
Your posts seem to imply (at least to me) that you think there's something wrong/dodgy about these deals rather than them simply being a bit "odd"
I apologise if I've misinterpreted this.

My point is that the only club that am aware of where the media treats any of its deals as related party is City. Not sure any of our deals actually are tho. I think we agreed to treat two as such in a comprise with UEFA.

Mean while half the championship probably has sponsorship with companies connected with their owners.

Wrexham has deals with companies connected with its owners.

Several top clubs here and abroad do some not treated as third party some perhaps are.

Countless others would appear odd but perhaps not third party. Be it odd crypto companies odd betting companies. Or companies run by mates of mates or companies paying a fortune for sponsorship in markets they are not yet in maybe they hope to be in those markets or maybe they are waisting their money or maybe something odd is going on.

Fans shouldn’t have to justify the accounting practices of there clubs and the media shouldn’t treat different clubs differently

I suspect most of the deals I would say might third party are treated as such in the accounts as the experts on here have pointed out the consequences beyond FFP are to great

But as fans we just do not know. I shouldn’t have to go on stoke city accounts for example to see how they treat sponsorship by bet 365 which owns them and then compare it with City for example just justify our situation.

For the record it appear they do declare it as such but as a normal fan I cannot tell what checks have been done by the league what the value is what fair value is etc etc perhaps we need a site that lays it out

 

[meltonblue]

An owner wants to invest in his club, but he can only invest what the club generates in revenue, what the club generates in revenue falls short of what the owner wants to invest, so he increases revenue by getting another company he owns to sponsor the team, and then he uses that sponsorship money to invest in the club.

It's called disguising equity as revenue.

Where’s it come from that that is what Wrexham are doing? If it’s a related party transaction then it’s assessed so that that’s not allowed to happen - Reading got done for trying it for example.

It’s still not comparable to our situation though as we didn’t declare any of them as RPTs.

 

[WRicko]

If the State Airline is your sponsor and Sheikh Mansour is the State, or if a company run by your second cousin, twice removed, from the dad of your third wife, is your official bog roll sponsor, then it all looks pretty related to me.

Are you a City fan ? Or are you new here ?

 

[waspish]

My point is that the only club that am aware of where the media treats any of its deals as related party is City. Not sure any of our deals actually are tho. I think we agreed to treat two as such in a comprise with UEFA.

Mean while half the championship probably has sponsorship with companies connected with their owners.

Wrexham has deals with companies connected with its owners.

Several top clubs here and abroad do some not treated as third party some perhaps are.

Countless others would appear odd but perhaps not third party. Be it odd crypto companies odd betting companies. Or companies run by mates of mates or companies paying a fortune for sponsorship in markets they are not yet in maybe they hope to be in those markets or maybe they are waisting their money or maybe something odd is going on.

Fans shouldn’t have to justify the accounting practices of there clubs and the media shouldn’t treat different clubs differently

I suspect most of the deals I would say might third party are treated as such in the accounts as the experts on here have pointed out the consequences beyond FFP are to great

But as fans we just do not know. I shouldn’t have to go on stoke city accounts for example to see how they treat sponsorship by bet 365 which owns them and then compare it with City for example just justify our situation.

For the record it appear they do declare it as such but as a normal fan I cannot tell what checks have been done by the league what the value is what fair value is etc etc perhaps we need a site that lays it out

I believe Any sponsor under 1 million don't get looked at so we could have 50 of them and it's fine

 

[citizen_maine]

My point is that the only club that am aware of where the media treats any of its deals as related party is City.

This is the crux of the matter though mate, and it's got absolutely nothing to do with the reality of our deals.
It's simply to drive clicks