The biggest threat to Manchester City’s Premier League dominance begins Monday with a hearing into numerous alleged financial breaches.
City's reputation hangs in the balance, with potential punishments as severe as expulsion from the league.
The club, which has won the last four league titles, denies the charges, including accusations of providing misleading financial information.
A team of lawyers will now attempt to clear City’s name and resolve the controversy overshadowing its remarkable period of success.
On Friday, manager Pep Guardiola confirmed that the much-anticipated hearing – centered on more than 100 allegations of financial misconduct – was about to begin.
"I’m happy it’s starting on Monday. I know there will be more rumors,” he said. "Everybody is innocent until guilt is proven.”
City were accused by the Premier League in February last year of providing misleading information about its finances over a nine-year period between 2009 and 2018, after it was bought by Abu Dhabi’s ruling family in 2008.
As City tried to establish itself as one of the leading clubs in Europe, it signed some of the world’s best players, like Yaya Toure, Sergio Aguero and Kevin de Bruyne, and won three league titles – in 2012, 2014 and 2018.
The league's financial fair play rules are designed to ensure clubs essentially spend what they earn, with commercial deals assessed for being at legitimate market value.
The charges followed a four-year investigation and the publication of leaked emails and documents, likely hacked, starting in 2018 by German magazine Der Spiegel. The documents allegedly showed attempts to cover up the source of City’s income to comply with Financial Fair Play rules operated by European soccer’s governing body, UEFA and the Premier League.
City were also accused of breaches related to its alleged failure to cooperate with the investigation.
The hearing will be held by an independent commission made up of three judges appointed by a lawyer who chairs the league’s judicial panel. The hearing will be behind closed doors, and a verdict is not expected until next year.
Potential punishments for a "serious breach” of the league's rule book are wide-ranging. Depending on whether City are found guilty of any charges, possible sanctions include a fine, points deduction, or in "extreme cases, expulsion from the competition,” according to the league's rules.
City said they were surprised by the charges when they were made last year.
"The club welcomes the review of this matter by an independent commission to impartially consider the comprehensive body of irrefutable evidence that exists in support of its position,” they said in a statement. "As such, we look forward to this matter being put to rest once and for all.”
Guardiola has repeatedly criticized the treatment of City.
"My first thought is we are already being condemned,” he said after the charges were announced. "We are lucky we live in a marvelous country where everyone is innocent until proven guilty. We didn’t have this opportunity. We are already sentenced.”
Known as Financial Fair Play, the regulations are aimed at preventing clubs from spending more than they earn. FFP was established in the aftermath of the 2008 global financial crisis, which deepened worries in European soccer that clubs could go out of business if the cost of player transfers and wages kept rising.
City were fined 60 million euros (then $82 million) spread over three years by UEFA in 2014 and forced to limit its Champions League squad to 21 instead of 25 senior players after violating FFP rules. Ultimately, City only had to forfeit 20 million euros of prize money after complying with the governing body's measures.
In 2018, the German magazine Der Spiegel published the "Football Leaks” series of articles supposedly based on City’s internal documents and communications. They suggested City had broken FFP rules in financial relationships with "related-party” sponsors from Abu Dhabi.
In February 2020, City were banned from UEFA competition for two seasons for "serious breaches,” including overstating sponsor revenue and failing to cooperate with investigators.
The Court of Arbitration for Sport (CAS) overturned the ban in July 2020, ruling that some UEFA charges were not proven and other evidence was excluded as time-barred.
The court "strongly condemned” Manchester City for obstructing UEFA’s investigation, though the 10 million euro fine was one-third of the original punishment.
