City FFP allegations examined by Uefa officials
European governing body looks into whether the club acted dishonestly
Uefa officials are examining the allegations made against Manchester City based on the “Football Leaks” of the club’s internal emails, to see whether the club may have conducted itself dishonestly or sought to illegitimately evade financial fair play (FFP) rules.
Co-operation is understood to have been sought from the Football Association and Premier League, who in effect take joint responsibility for working with English clubs to meet the requirements of Uefa’s license.
No actual investigation into City is understood to have yet been started, and the club has not been formally contacted with questions.
Allegations by the German magazine Der Spiegel, that City cheated and presented a “tissue of lies” to comply with Uefa’s FFP rules, which limited losses to ¤45 million (£40 million) in total in the 2011-12 and 2012-13 seasons, focused on a series of devices apparently revealed by the emails.
They included the alleged payment to City’s then-manager, Roberto Mancini, of £1.75 million for consultancy services, from Al Jazira, the Abu Dhabi club owned by City’s owner Sheikh Mansour bin Zayed, more than the £1.45 million, excluding bonuses and incentives, Mancini was being paid by City themselves.
Der Spiegel also alleged that FFP rules were cheated by Sheikh Mansour paying the majority of the sponsorship by the Abu Dhabi airline Etihad; and by City selling image rights of players to a company, Fordham Sports Management, to move wage spending off the books.
City’s stance, maintained throughout, was not to respond to the substance of the allegations. The club issued only one statement which itself alleged that the emails, reported over four days by Der Spiegel, were obtained by hacking or theft, and presented only part of the picture. “We will not be providing any comment on out of context materials purportedly hacked or stolen,” the statement said. “. . . The attempt to damage the club’s reputation is organised and clear.”
Der Spiegel has cited an anonymous operator of the Football Leaks operation, given the pseudonym John, whom it quoted saying internal emails from City, Fifa, Wolves and other clubs and organisations cited during their series were not obtained by hacking but from his good sources in football. The Guardian has not had access to the Football Leaks emails or been able to verify them.
Uefa officials and the members of its club financial control body’s investigatory chamber have read and discussed the allegations, and are understood to have formed preliminary views of some elements from their own knowledge.
The arrangement with Fordham appears unlikely to have any consequences for City now, because – according to several sources with knowledge of the process – the club disclosed the details of it to Uefa at the time, after Uefa asked questions about the figures stated in the accounts. Uefa officials are understood to have examined the deal then, and decided not to allow it as a reduction of the wage bill. City had declared in their accounts £25 million received from selling image rights, and were known then to have been indignant Uefa had not accepted it as legitimate income to offset the losses.
The allegation Sheikh Mansour himself paid the bulk of the Etihad sponsorship, which was based on internal emails of City officials, has been denied officially by Etihad. Uefa has never taken issue with the Etihad sponsorship itself, concluding that the airline’s payment was “fair value” for having its name on the club’s shirt and stadium, and was not an artificially inflated sum to disguise investment by Mansour.
The alleged salary arrangements to Mancini, which look to have been a tax-saving mechanism with the money paid in Abu Dhabi to an offshore account, appear to be the most difficult for City to justify. Der Spiegel’s coverage said the contract was agreed when Mancini joined City in 2009, so before the FFP rules came into force, and even if it were later related to FFP, a £1.75 million annual reduction would have had negligible impact on City’s efforts to meet the break-even target. It does, however, leave the question of whether the Mancini contract, if it was indeed structured in that way, was proper according to City’s general duty to disclose all its spending to the FA, Premier League and Uefa.
Although City have not commented, the fact that they presented their audited and signed-off accounts with the necessary declarations means that by definition their stance is that they did comply with their responsibilities and broke no rules. – Guardian
German magazine Der Spiegel has alleged Manchester City cheated and presented a “tissue of lies” to comply with Uefa’s FFP rules.