A UEFA panel investigating financial allegations concerning Manchester City are expected to recommend the club receive a one-year ban from the Champions League, according to Sky sources.
UEFA opened an investigation into alleged financial irregularities at the club earlier this year but City deny any wrongdoing and say the accusations are entirely false.
The Premier League champions have expressed concern about the reports which have emerged – initially in the New York Times – suggesting that investigators will push for a Champions League ban, before any official statement has been made by the European governing body.
A City statement read: “Manchester City FC is fully co-operating in good faith with the CFCB IC’s (club financial control body investigatory chamber) ongoing investigation.
“In doing so the club is reliant on both the CFCB IC’s independence and commitment to due process; and on UEFA’s commitment of March 7 that it ‘…will make no further comment on the matter while the investigation is ongoing’.
“The New York Times report citing ‘people familiar with the case’ is therefore extremely concerning.
“The implications are that either Manchester City’s good faith in the CFCB IC is misplaced or the CFCB IC process is being misrepresented by individuals intent on damaging the club’s reputation and its commercial interests. Or both.
“Manchester City’s published accounts are full and complete and a matter of legal and regulatory record.
“The accusation of financial irregularities are entirely false, and comprehensive proof of this fact has been provided to the CFCB IC.”
A statement from UEFA read: “We do not comment on ongoing investigations regarding financial fair play matters.”
What are Man City being accused of?
At its core, Man City are accused of misleading UEFA. But the nuts and bolts are more complex.
UEFA have been investigating files, including hacked e-mails – first reported by German publication Der Spiegel last year via Football Leaks – which appear to show City inflating sponsorship income.
These files reportedly include documents and e-mails which show efforts made by City officials to skirt Financial Fair Play (FFP) regulation, by disguising cash infusions from a UAE state-backed investment company as inflated sponsorship agreements, including from Etihad, the club’s main sponsor.
For example, a file discovered by Der Spiegel last year suggests that Etihad accounted for just £8m of a £59.5m sponsorship agreement, and the rest was made up from ADUG (Abu Dhabi United Group), the investment group Sheikh Mansour used to buy Manchester City over a decade ago.
What’s wrong with that?
UEFA’s FFP rules are designed to ensure the amount clubs spend on players and wages is close to what they earn in commercial revenue and prize money.
Simply, they want to ensure clubs do not spend beyond their means, and that financial competition among clubs is kept strong, rather than the richest owners injecting money to blow all rivals out of the water.
So if City’s owners were found to be injecting lump sums of cash into the club, this would be a breach of FFP.