Friday briefing: How Manchester City’s financial scandal could upend the whole football league
Good morning. It’s a sporting scandal of colossal proportions, with the juiciest details still to come. Manchester City’s ascent from mediocre to majestic changed the landscape of British football. Now, that pace looks set to be matched by a sudden, plummeting fall. The club has been found guilty of breaching football finance rules to the tune of hundreds of millions of pounds, with ramifications poised to spill far beyond Manchester (the club denies the allegations, and says it will appeal). Foreign state ownership makes this an international relations issue, not just a sporting one. The prime minister has been dragged into the sleaze-fest, and the stream of stories shows no sign of slowing. Meanwhile, the Mancunian club has the chutzpah to sit at the top of the Premier League, much to the repulsion of my Manchester United-supporting boyfriend. With the help of Guardian football writer Jonathan Wilson, today’s First Edition delivers everything you need to know about the crisis engulfing the beautiful game, and believe me, this one’s not just for the footie fans. That’s after the headlines. Five big stories Ukraine | Wes Streeting urged the US to stand by Ukraine on his visit to the American capital and sought to cool tensions between the two countries in the wake of the Starlink row that is threatening to set back Kyiv’s war effort. UK news | Jeffrey Donaldson has been sentenced to 15 years for sexual offences against two women who were children when he abused them, completing what was described as a “catastrophic descent into disgrace”. Hacking | An Israeli advertising agency has been serving millions of online adverts that allow “zero-click” spyware to be used against targets, researchers at a Canadian university have said. UK news | A woman has alleged Russell Brand told her “it’s just fun” as he raped her in a hotel room at the 1999 Labour party conference, a court has heard. US news | Donald Trump has shelved a widely condemned plan to livestream the execution of a disabled man by firing squad. In depth: ‘There was a sense that the panel felt lied to by City’ To some (Manchester City fans, mostly), it was a sporting success story for the ages. After decades of underachievement, a middle-of-the-road club transformed into England’s best performing – and top title-winning – team. Others grumbled that City’s success was a sad indictment of the state of modern football. The club’s change in fortunes came shortly after they were bought by the Abu Dhabi United Group, a private equity group owned by the Gulf state’s vice president. Billionaires had already gutted the topflight of its heart, now governments with entire GDPs to burn had descended. Except, of course, the cash injection at Manchester City breached strict Premier League limits. Financial fair play rules, introduced by the league in 2013, aimed to keep a lid on spending so that clubs – financed by, say, a fossil-fuel rich state – couldn’t simply spend billions for immediate dominance. Only, that’s precisely what Manchester City did. According to an independent panel, they secretly boosted their income by a staggering £900m between 2009 and 2018. When he first flicked through the panel’s 40-page verdict summary, Wilson was surprised by the “incredibly strong language it used for a dry legal document”. The word “sham” is repeated eight times. “There was a clear sense that the panel felt systematically lied to by City,” says Wilson. The real spice is likely to come in the yet-to-be-published appendices to the verdict, which will probably contain names, companies and detailed figures. These recent revelations didn’t come out of nowhere. Back in November 2018, German newspaper Der Spiegel published a four-part series on Manchester City (“Bending the Rules to the Tune of Millions” was the first headline). The paper’s bombshell reporting was based on data released in The Football Leaks, a website containing millions of documents on allegedly murky financial transactions in the sport, made public by Portuguese whistleblower (and convicted hacker) Rui Pinto. UEFA conducted an investigation, and in 2020 found the club guilty, though the punishments (a two-year ban from European competitions and a €30m fine) were watered down on appeal. Meanwhile, Manchester City kept on winning. “There was wide recognition that Manchester City had gotten away with it by dragging out the process,” Wilson tells me – the commission said that the club “made concerted efforts to stop and frustrate” the investigation. “There was a sense then that football could not really handle situations like these,” Wilson says. Then, last month, the Premier League announcement came: Manchester City was guilty of 114 charges. It’s understood these offences correlate to information already in the public domain: that Manchester City inflated the value of sponsorship deals to channel extra cash into the club; that secret payments were made to senior club figures and player agents. These were a contravention of financial rules, and the club obstructed Premier League investigations. The club has maintained its innocence, and intends to appeal. *** A sizeable punishment? Even allowing time for Manchester City to appeal, a sanction decision is expected around Christmas. Fines, point-docking, transfer bans, suspension and expulsion are all being discussed, though Premier League rules dictate there’s no limit to the penalties that could be dished out. The sheer scale of the rule-breaking means there’s little precedent for comparison. Everton were docked six points for a £20 million rule breach. Apply the same metrics, and Manchester City would lose hundreds. Knocking that much off their tally in a single season is “functionally identical” to a much softer sentence, says Wilson. (Points reset every season, and last year, league-toppers Arsenal finished on just 85.) “It leads to the conclusion that expulsion from the Premier League might be the only logical outcome,” says Wilson. He’d also like them stripped of their titles, and to see an investigation launched immediately into the club’s finances from 2018 until now. Expulsion would be complicated. The complex structure of English football means if Manchester City did get booted out of the Premier League, there’s no guarantee the club would find a place in a lower league. And, even if it’s recommended by the panel, Premier League clubs would need to vote it through on a two-thirds majority. “That vote is unpredictable, as some club owners have business ties in Abu Dhabi or fear setting a precedent where clubs can vote out rivals,” says Wilson. *** How worried should Man City be? Off the pitch, there’s the prospect of civil litigation lingering too: Liverpool, Arsenal, Manchester United and Tottenham Hotspur each submitted formal legal notices before a September 2024 deadline, which reserves them the right to claim compensation for losses caused by City’s rule breaches. When Everton breached financial rules in the 2021/22 season Burnley successfully claimed close to £40m from the Merseyside club. The sums at stake in this instance could be eye-watering. Plus there’s the prospect of possible criminal proceedings. Tom Forster KC, a financial crime barrister, suggested that Manchester City “has a great deal to be worried about on this front”. Then there’s the political fallout, which is still taking shape. Andy Burnham was mayor of Greater Manchester through this period, a time during which Abu Dhabi made serious investments in the city. “That can be viewed either as benevolent community building or as a calculated investment, expecting returns and local influence,” says Wilson. Either way, it’s not ideal for the new prime minister. Plus, Burnham’s initial response to the judgment raised eyebrows, saying he’d be “really concerned” if the owners were forced to sell. “His skepticism of the charges sounded like comments from a fan on a message board rather than a measured politician,” says Wilson. Clarifications from Number 10 soon followed, and Burnham committed to publishing details of his dealings with Manchester City. Yesterday, he requested a “manual trawl” of records from his time as Greater Manchester Mayor, after two hospitality dinners with Manchester City’s chair were found to be absent from the combined authority’s digital register. *** What does this mean for English football? The ramifications for English football are clear. The Premier League faces a massive problem: the success of its top side is built on foul play. And not just between 2009 and 2018, Wilson reckons. “Even if we assume City complied cleanly after the leaks emerged, their success since remains predicated on that unfair advantage. That’s a lot of titles – and a lot of prize money – won under compromised conditions. As it stands, this is “hugely damaging” to the Premier League’s reputation and fan trust, Wilson says. Football is the UK’s most popular sport, and is worth billions to the economy. If faith is lost in the sport, that’s a real problem. On the other hand, football is just a ballgame without the drama, spectacle and narrative – to which this debacle adds plenty. Especially, Wilson says, “if the outcome demonstrates that the Premier League is willing to enforce its regulations against even its most dominant team.” But there’s a story much bigger than football here. Manchester City (and Saudi Arabia’s Newcastle United for that matter) aren’t the only British institutions quasi-owned by foreign governments. Qatar, Saudi and China own the bulk of Heathrow Airport; through state-owned EDF, France claims significant chunks of UK energy infrastructure. Royal Mail, meanwhile, is owned by a Czech billionaire; more than 70% of the English water industry is in foreign ownership. “This case illustrates the extent of foreign state influence over major British institutions,” says Wilson, “tracing back to New Labour policies that encouraged foreign state investment without sufficient safeguards against geopolitical manipulation.” But, if the Premier League holds course, its response could be just as symbolic. “In a broader societal landscape where massive wealth often overrides accountability, this would represent a major British institution taking a stand to enforce rule of law and regulatory compliance.” What else we’ve been enjoying I enjoyed Rhiannon Lucy Cosslett’s column on the return of Girls, and what it could look like now its protagonists are more women than girls them. Poppy Noor, newsletters team I don’t get a chance to dance these days. So I found Lyndsey Winship’s piece on which music is the best to get down to both absolutely fascinating and a potent reminder to get myself ‘out out’. Lucinda Everett, newsletters team If you’ve used the term “greedflation” you’re borrowing a term from Isabella Weber, who is quickly becoming one of the most sought-after economists of her generation. Our own Michael Segalov interviewed her, and the piece out this morning provides a rare bit of hope. Poppy Maya Yang’s report about a loophole that lets private firms catch protected sand tiger sharks in the US and sell them to foreign aquariums is a shocking but important read. Lucinda I thought Zoe Williams was superb on Sally Rooney’s courage and humanity. Poppy Sport Football | Brazilians Evanilson and Rayan scored as Bournemouth eased to a 3-0 win over Sturm Graz of Austria in their first-ever home European tie; Sunderland came from behind to beat Torreense 2-1; Crystal Palace and Celtic both defeated. Rugby league | Jack Bostock almost single-handedly stole the Rugby League World Cup opener, with three tries and a crucial assist in a 24-22 victory over New Zealand. Football | European football leaders are increasingly confident they will find a candidate to stand against Gianni Infantino in next year’s Fifa presidential election. Something for the weekend Our critics’ roundup of the best things to watch, read, play and listen to right now Film NAZA (in cinemas now) | ★★★★☆ Under the cover of night, anonymous Israeli intelligence officers and personnel discuss the secret systems used in the war on Gaza, in a documentary produced by the Guardian. Read Peter Bradshaw’s full review. TV The Diplomat (Netflix) | ★★★★★ Keri Russell is still trying to stop a sea of berks who are one bad hair day away from starting a nuclear war – only this time, the cortisol levels and the sauciness have been ramped up even further. Read Sarah Dempster’s full review. Music Fontaines DC: Dopamine Chamber | ★★★★★ This is a beguiling, endlessly inventive and frequently astonishing fifth LP from a group at increasing ease with being the best band of their generation. Read Laura Snapes’s full review. Art and design Tarek Atoui’s Turbine Hall (Tate Modern, London) | ★★★★★ The Lebanese artist has turned trumpets, drums, cones and voices into an ingenious, interconnected sonic beast with funny, sad and mystical results. Prepare to feel the earth move! Read Jonathan Jones’s full review. The front pages The Guardian splashes on “Revealed: chancellor poised to raise taxes on banks in budget”. The Telegraph says “Healey plans tax raid on banks”, the Times runs “Hospitals to place trans women on male wards” and the i Paper headlines on “Energy bills set for double rise in the new year”. The Mail has “Dumb and dumber”, in reference to Labour’s education policy, and the Financial Times says “Merz stands by welfare reform overhaul as he vows to fight on”. Elsewhere, the Sun and the Mirror focus on the Russell Brand trial, running the same headline, based on witness testimony: “Brand made me take pic … then he raped me”. Brand denies all the charges and has pleaded not guilty. The Latest ‘I couldn’t breathe’: Russell Brand trial hears from first alleged victim Former comedian Russell Brand is on trial facing multiple charges of rape and sexual assault against six women, spanning a decade from 1999 to 2009. On Thursday the court heard evidence from a woman who alleged Russell Brand told her “it’s just fun” as he raped her at the 1999 Labour party conference. He denies all the allegations against him. Lucy Hough speaks to senior national news editor Aaron Sharp. Cartoon of the day | Ben Jennings The Upside A bit of good news to remind you that the world’s not all bad They say everyone’s got a book in them … but most of us have no idea how to even begin putting pen to paper. Helpfully, in this piece Madeleine Aggeler asks the experts on how to get started – and keep going. From setting timelines to taking classes and writing even just a page at a time, it’s filled with great guidance, including this from novelist Christopher Moore on how to restart your abandoned opus: “Think about why it’s important to you to finish it. What would it mean for you to complete this project?” Sign up here for a weekly roundup of The Upside, sent to you every Sunday Bored at work? And finally, the Guardian’s puzzles are here to keep you entertained throughout the day. Until tomorrow. Quick crossword Cryptic crossword Wordiply







