Premier League confirm Man City guilty of all charges - 5 Live Reaction

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1:06You're listening to the Football Daily Podcast with Kelly Summers. Two hours ago, the Premier League released the most extraordinary and damning statement in their 34-year history. They said they found Manchester City guilty of all charges against them, claiming that the club hid nearly a billion pounds worth of investment, that they refused to cooperate with the investigations and also accused witnesses of lying. With me this evening are the BBC's Football Issues correspondent Dale Johnson, football finance expert Kieran Maguire from the Price of Football podcast, as well as our football correspondent John Murray and, of course, former England goalkeeper Paul Robinson, who are out in Prague for us.

1:46gents there is just so much for us to get through here Dale I'll start with you we already knew from everything we were hearing that Manchester City were guilty but the level of detail today is nothing short of extraordinary is it? Yeah I mean we were here in Copenhagen for the European Football Club meeting and Ferran Soriano was here and wasn't really answering questions and it just sort of came as a bit of a bombshell for us here about 6 o 'clock certainly in some of the detail that is within not just the Premier League statement, but also the document, the 40-page document that's come with it.

2:21And what we know at the moment, and there's more detail to this, of course, which we'll get into, the fact that they've said there were sham contracts about the way that they were able to get agreements and artificially inflate the club's revenues. And also the fact that they have misstated accounts and concealed the true state of the club's finances, starting in 2009-10, but onwards from then, So it covered all nine years where they would have failed the financial fair play rules if they had not done these fake deals, essentially. It's substantially in breach. And they've committed multiple breaches of its duties to be cooperative and act in the utmost good faith towards the Premier League and the rest of the member clubs.

3:08Kieran, we've been waiting to hear from the Premier League what they'd make of it. But what did you feel or think when you heard this statement drop earlier? Because the language in it is very, very strong, angry even from the Premier League. That's right. You normally expect a statement to have been through the legal team and therefore tends to be somewhat tempered. The fact that there are multiple references to the word sham. As soon as you start to read the report, the accusations which appear to be undertaken that people have lied to the commission and are false witnesses, and then the extent of the money.

3:44To try to put these figures in context, Manchester City had a£900 million gain. So I looked at the accounts for all of the big six clubs over that nine-year period. They, on average, were generating revenue of£2.9 billion. So Manchester City effectively were getting one pound in three benefits when they were competing with other clubs for recruiting players, paying wages and so on. So the numbers involved are staggering. And the fact that it makes representations that the auditors also had been deceived. This is a coordinated and concerted campaign to falsify and fraudulently represent the accounts of the club.

4:29You both mentioned there the phrase sham contracts that the statement mentioned. It was actually mentioned eight times in the report. Kieran, can you kind of explain what these sham contracts are? What are the Premier League referring to? Well, what the commission concluded was that Manchester City were signing sponsorship arrangements. And it's done this on a season by season basis. If you go through the 40 page report and effectively for every one pound that was coming from the sponsors, around about eight pounds was actually coming from the club owners. And this was being added. And what was happening is that Manchester City was pretending it was receiving a lot of money from the sponsors.

5:11whereas in reality they were only contributing a small element. And the reason why that's important is that when you do your PSR calculations, it's based on your match day revenue, your broadcast revenue and your commercial revenue. So overstating by£830 million over the period, the commercial income gave Manchester City a huge competitive advantage and meant that it didn't break the rules when it submitted its papers to the authorities. I've had a look through. This is point 72 that you're referring to, isn't it? The City used a disguised funding scheme to claim that they had£949 million of income through sponsorship.

5:49The Premier League say that the actual figure was£119 million. Big difference. Yeah, I mean, it's incredible numbers. And if you take a look at Manchester City's sponsorship income immediately following the acquisition by Sheikh Mansour and Abu Dhabi, initially the numbers were quite flat and then as soon as some form of cost control the initial financial fair play rules were announced there was this huge spike in commercial revenue and on the basis of the report those numbers have been falsified to allow City to comply with the with the cost control limits. Dale the other part of the statement that was so damning I think was where it talks about the club basically not helping the Premier League.

6:39The club made concerted efforts to stop and frustrate the Premier League investigation. The club breached duties of cooperation that it owed to the Premier League. They also say that witnesses gave false evidence. That is not a good look. It's not, no. And what you have when you get through to the sanctioning hearing, which will happen, well, we don't know exactly, but they say as soon as possible. There's something called mitigating factors which are used to try to reduce the penalty you get. And one of the things that clubs always tend to use is having this good cooperation. And the fact that there is no mitigation for this whatsoever, it's actually going to be an aggravating factor rather than a mitigating factor.

7:22And any hope that City could have to use something like this to reduce the penalty they will get will not apply in this case. Yeah, it's interesting because, Kieran, City themselves have said they have complied with it, They have gone through the process. Of course, they will say that. That's what they're going to say. But it's obviously very different for the Premier League. They don't feel that happened. That's right. And again, the comments which have come from the report itself, evidence given by a number of important factual witnesses called to give evidence on behalf of the club was false.

7:56and that certain of those factual witnesses had given evidence at the hearing that they knew to be untrue and so had been dishonest, that is as damning as you can get from a legal report. So, as Dale was saying, the club's attempt to plea mitigation to the next commission, which will take place, and that will sit and it will hear two things. First of all, what the Premier League considers to be an appropriate punishment And secondly, what would Manchester City believe to be an appropriate punishment? Well, if those comments are coming from senior executives at the club and we are still awaiting, I think there's something called Appendix 6, which will be published in due course, which names all of the witnesses.

8:43So presumably those witnesses who have lost credibility from these comments, surely they cannot give any mitigating comments to the next commission. It's staggering, isn't it, as well? The commission added there were 7 ,000 pages of transcripts from witness interviews to go through alongside other documents, which in total amounted to tens of thousands of pages. Dale, this probably explains a little bit as to why this one feels like it really has dragged on. Yeah, and the Premier League in the statement did say that they regretted that it had taken as long as it did. But it was just the case that there was so much evidence to go through that it really was a case that they couldn't really avoid it.

9:23And yeah, I mean, 7 ,000 pages. I mean, at least if Manchester City appear, which you think they will, then it will just be a case of going over the evidence that's already available rather than going back to anything and creating any new evidence or bringing anything else to the table. The Premier League statement does say, Dale, that City have been guilty of all charges, but it seems they did get off one of them, wasn't it? I think it was all the financial ones that they've been proven guilty of. Yeah, it's all the financial rules over a nine-year period and a majority of charges in relation to its failure to cooperate.

9:54So anything that's to do with what Kieran talked about, these inflated commercial fees whereby they had a base fee paid by the sponsors and then a top-up paid by the owners, then they are all being proven. I mentioned the tone of the statement before. John Murray, I'll bring you in here now. It seems very angry from the Premier League. You, like myself, like all of us, will have read a lot of similar statements in the past. I'm not sure I can ever remember reading one with as much feeling behind it. No, I think it's the detail, isn't it? The detail of the charges, as Dale and Kevin have been outlining there.

10:35I think the detail that's in there, the figure of over£900 million, obviously jumps off the page. But I think particularly as well, you mentioned it, Kelly, the word sham. I think now that word sham is going to be associated with this case. That is going to become part of the footballing parlance for years to come. We will be referring back to sham in connection with this case. Also as well, I think what people will be wanting to hear is what are the punishments going to be? What are the sanctions going to be? And now we know that that is going to be addressed in a separate hearing with the Independent Commission.

11:16But there's no date on that. So, you know, that is open ended. And obviously we know that Manchester City have put out a very strong statement, haven't they, again this afternoon. So I think those are the main takes from it. Yeah, Richard Marse's statement says the club systematically broke Premier League rules for nearly a decade. Some of the other words alongside sham, dishonest, misleading. I mean, the Premier League are not leaving us in any question as to how they feel about this. And as you said there, John, Man City, in contrast, saying they very strongly refute it and are, it seems like, going to appeal.

11:52And they have until Friday to do that. But I guess the question as well, Dale, is what could City show that they haven't shown already? Surely by this point, with it having gone on as long as it had, they'll have laid all their cards on the table, all their evidence down. Well, that's just it. And Manchester City have said that they have irrefutable evidence that this is the case. Well, clearly on what we've seen today, it is refutable because the Commission has been very clear that what's been said by Manchester City is not trustworthy. Our question now, of course, is where does this punishment go?

12:25Now, if we look at the case of Edderton from a few years ago, they got six points for a£20 million overspend. so once the PSR and we get the actual figures for the PSR overspend for each of these nine seasons then that is when it's going to get interesting in terms of the number of points that Manchester City could face being deducted based on that precedent

13:12We'll see you next time.

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15:16This is the Football Daily Podcast with Kelly Summers. We've been hearing as well from David Bernstein, the former Man City chairman and the FA chairman, and he was very strong when he spoke earlier on Five Live Drive. It is damning beyond belief, really. They've talked about producing sort of forced documentation and a pattern of behavior over a number of years that is really quite unbelievable. So my immediate thoughts are, can the board of directors, as presently are, continue? Should the people involved be suspended immediately? If this was a public company or some other authority, I think there would be questions immediately about whether it was correct for the people who will be involved with this to continue at least until there was an appeal or something.

16:15And that comes to the second point, is that I'm very concerned that Manchester City may almost bring the processes of disrepute by really fighting an appeal that if one believes what one now hears by the extent of this, and what I think they described irrefutable evidence, maybe just a way of extending things and creating further turmoil. So, yeah, very, very serious. You couldn't see something more damning than the Premier League. And after all, Manchester City are part of the Premier League. I think it's really terrible. I wonder that if these accusations are so, let's take it as red for the moment, are they subject to appeal, whether some of these issues might need to be referred to authorities outside the League.

17:09That's only a thought. Who do you mean by that? Well, I mean by that, that producing forced documentation and benefiting financially, but with the tune of millions of pounds from it, is a very serious thing to have done and to be found guilty of by the football authority. And by that I mean, is this something that goes beyond the ambit of the football authority? I don't want to say more than that. Okay. To be clear what I'm getting at. Yeah, I think we're clear what you're getting at. We had a guest just in the last half hour say, from his reading of the situation, it's a deep-seated form of fraud.

17:49Would you go that far? I would go that far, yes. And if it is, then I'm not a lawyer and I'm only just putting this on the table as a thought, really. But it is something that is so serious that it goes beyond the football authorities. They have till Friday to appeal, the club do, according to the Premier League. The sanctions will come their way pretty quickly. What do you think the sanctions should be? You say the reputation of the Premier League is at stake insofar as how it responds to this. What should they do? Yes, I think the Premier League have done an outstanding job with this. To get to where they've got to, it's not easy.

18:31Well, I don't want to say that I think the sanctions cannot just be financial because financial money doesn't mean much to the owners. So it's got to be something way beyond that. I think if all this stands up and an appeal fails, I think that Manus City cannot stay in the Premier League. David Bernstein with Clare Macdonald a little bit earlier on Five Live Drive. And I think it's safe to say he feels very strongly about this. And he talked about it being beyond football, the punishment. He also mentioned whether the current city board could continue in place. There's going to be a real question about that now, Dale, isn't there?

19:07Yeah, absolutely. And you've got to remember there's also the role here of the independent financial regulator. And while the licenses for clubs don't come in until next season, they're already able to look at the suitability of current directors. and that's currently happening with Sheffield United and the way that they've moved their ownership from one club to another. And you can imagine that once this is actually finalised, the independent financial regulator will want to look at the role of these directors and their integrity and honesty throughout the process. And from that, they can take a range of action from censoring to trying to remove these directors from the club.

19:43Paul, you've been in football a long time as a player and now on the other side, what have you made of all of this? I think we all start to understand the severity of it now don't we but what I don't understand is what the Premier League have come out today and how strong that they've actually been and Manchester City have levelled them back with as strong a word as what they've got I mean they're both fighting their corner in extreme ways it looks like they're using the strongest possible words from both of them I've actually got a couple of questions for Dale and Kieran I mean whoever wants to field them we all kind of understand what's going on and we've got the crux of it but how long is this potentially going to go on for and what are the next steps?

20:21Because we're hearing today that Manchester City have had the statement from the Premier League. What happens now? Because we're hearing that Manchester City have already appealed the sanctions without knowing what the punishment's going to be. So what are the next steps of this process? So there are two distinct processes here. One is the appeal against the judgment that they are guilty and then once the sanction actually comes there will be the ability to appeal against the sanction itself as well. So sometimes you get the whole result in one. In this, it's going in two separate parts. So we will imagine, judging by what Manchester City have said today, that the appeal will go in by Friday.

21:01And then there's going to be a process whereby that's heard, where it's supposed to be heard within 12 weeks. We don't know if that will be the case in this particular case. But then we've got the actual sanction part as well. Now, what the Premier League will be very eager to do is get this completed by the end of the season. And within their regulations, they have the ability to go faster with these cases so that it doesn't drag out. But this is such a very strange situation whereby we're expecting such a large penalty that it's a cloud over the rest of the season. Let's just take the match a week on Sunday.

21:37let's say that Manchester City go to Liverpool win that game and it turns out they go six points clear at the top of the Premier League that's pretty much meaningless isn't it because no one really expects that City can realistically if they don't win their appeal still be at the top of the Premier League at the end of the season and also something else that's been on my mind there's a lot of talk obviously on social media and people are speculating as to what the punishment could be, should be and is going to be what happens with the Premier League and the EFL because this is a Premier League issue The Premier League are well within their rights to deduct points and ensure that they're relegated from the Premier League in the correct ways.

22:11They can't just throw them into League Two because that then throws the EFL into disrepute, surely, and it gives them a mess to deal with. Do they have to have a relationship with the EFL going forward? Yes, we do actually have some precedents for that, Paul, because in the Leicester City case, which took place last year or earlier this year, Leicester City were in breach of the Premier League PSR rules. The Commission made a recommendation and the Premier League and the EFL now do have a sort of a channel through which they will opt to consider punishments given by each other's board. So therefore, whilst the EFL does not have to take the recommendation of the Premier League Commission, there's nothing to stop it from saying, yes, we've heard it.

22:58We've spoken to our members and we think that relegation to League Two is an appropriate punishment. So it is so that they both changed their constitutions to allow this because there were problems a few years ago when the Premier League couldn't apply an EFL punishment. So there has to be a conversation between the Premier League and the EFL. Once the Premier League have decided what they want to do, they then have to ask the EFL if they will accept them to where the Premier League see fit for them to start their next campaign when and wherever that may be. That's correct, but certainly in the case of Leicester City.

23:33And also, if you take a look at some of the pronouncements that we've seen in the Premier League website itself in the past few days, it said we're getting on really well with the EFL. Now, whether this is, you know, we're now sort of putting two and two together and getting five. But, you know, is this indication that on these particular issues, and there's a separate discussion, of course, between the Premier League and the EFL about monetary distribution. Again, they seem to be making some progress there. It does appear that there's much better relations than a few years ago. But, Kieran, you're essentially saying there is a scenario where the EFL could say, no, we don't agree.

24:10And I guess Paul's next question will probably be what happens then? Well, under those circumstances, if there's a huge points deduction, Manchester City would be relegated. And what could happen is that I would imagine that there will be discussions between the two bodies. You know, people will be pragmatic about this. It would be in the EFL's interests. With Manchester City in the EFL, that's going to help them negotiate their next broadcasting deal. Manchester City in League Two is going to be the biggest show in town in the EFL for three seasons. So if you talk to EFL club owners, some of them will say, well, yeah, that's going to impact upon the ability of my club to be promoted from League Two.

24:54Others will say, this is our biggest payday of the season. Bring it on. Yeah, I guess we are getting a bit ahead of ourselves at this point. We, of course, are anticipating Manchester City to appeal before then. Paul, how do you think this will be affecting the players? There's a few players preparing for a game who also play for Manchester City. Yeah, well, we were in the press room, obviously, two or three hours before the game, talking to all the written journalists and the media, and their focus is on this story that's just broken. I mean, there was a huge story around the England game tonight, who would play and who wouldn't play.

25:24But now all of a sudden, everyone's focus has switched to this because it is such a damning statement. And as a player, I played at Leeds at the time when we went through all the financial trouble and all the stuff that happened off the field. And it's difficult at times as a player. but because I think this is so fresh and it's so new today, the players probably won't understand the severity of the statement and they'll go out and they'll perform to a level and I don't think that this will affect the players because I think going forward, they are going to be Manchester City players until they're obviously told otherwise and I think they try and separate off-field to on-field but I think when it's affecting your everyday life like it did with us at Leeds with your salary sacrifice, etc and it affects your everyday life, then it does become an issue but until I think this is resolved I think we'll probably have this conversation when the the verdict is is announced and the players at Manchester City actually start questioning their future or if they have one well I've been watching Mark Gay and Elliot Anderson in the warm-up and you know just doing their job doing what they have to do and I think it is as Thomas Tuchel said after the match on Saturday obviously the players will talk about this in the time that they have.