Leaks reveal City deal to hide player costs from UEFA
GENEVA: Manchester City created a shell company for a commercial deal to disguise tens of millions of dollars in income from UEFA investigators, according to club documents cited by a German magazine.
Der Spiegel cites internal City correspondence to show the team’s holding company, state-backed Abu Dhabi United Group, paid the shell firm to “buy” player image rights from the club.
The magazine reported that City officials detailed a long-term search for “creative solutions” to hiding expenses and evading UEFA monitoring of spending on players.
City risked Champions League expulsion in 2014 if a UEFA club finance panel had found they had severely breached “Financial Fair Play (FFP)” rules, designed to curb overspending on player costs.
Critics say FFP protects storied clubs from ambitious rivals with new and wealthy owners.
Der Spiegel is leading the Europewide publication of the “Football Leaks” documents.
In recent days, European media have detailed plans shaped by Real Madrid for a breakaway European Super League kicking off in 2021 and how FIFA president Gianni Infantino has intervened in their independent ethics committee’s work.
Der Spiegel also reported last Friday that City threatened to destroy UEFA with legal action before reaching a 2014 settlement
to forfeit 20mil (RM96mil) in prize money.
City have not disputed the authenticity of the documents and said an “attempt to damage the club’s reputation is organised and clear”.
Since City were bought with Abu Dhabi sovereign wealth in 2008, a team long in the shadows of more glamorous Manchester United have overtaken their rivals on the field.
City achieved this spending more than £1bil (RM5bil) to win a first English Premier League title in 2012.
This rise coincided with UEFA creating rules – in consultation with the European Club Association (ECA) – to limit spending within a club’s ability to generate revenue.
Der Spiegel cited City documents in which officials wrote: “Without significant additional revenues ... UEFA FFP compliance WILL NOT be achieved.”
City CEO Ferran Soriano complained in one memo that ECA members were pushing for the UEFA rules – which many thought could curb the rise of City and Qatari-owned Paris St Germain.
“We will need to fight this,” Soriano wrote, according to the magazine, “and do it in a way that is not visible or we will be pointed out as the global enemies of football”.
City apparently wanted to shift some costs away from the club and helped set up a shell company called Fordham Sports Management with two British investors.
It was supposedly used as a vehicle to disguise payments to players for the right to use their image in marketing campaigns.
Der Spiegel said this helped turn
almost 30mil (RM143mil) into revenue instead of a cost, for the purpose of UEFA’s investigation of club accounts. — AP