On Friday, just as the world of football was serenely coasting through another international break, that all changed when the Premier League announced the biggest points penalty in the competition’s 32-year history.
Everton were deduced 10 points by an independent commission for breaching the competition’s Profit and Sustainability rules during and prior to the 2021/22 season.
Clubs are permitted to lose £105 million over a three years period, with Everton reporting loses of £124.5million on ‘footballing costs’.
This is just the fifth time in English top-flight history that a team has been hit with a points deduction:
- 1891: Sunderland deduced 2 points for fielding an ineligible player.
- 1990: Arsenal deduced 2 points & Manchester United 1 points following on-pitch brawl.
- 1994: Tottenham deduced 12 points for financial irregularities (later overturned in court).
- 1996: Middlesbrough deduced 3 points for failing to fulfill a fixture against Blackburn Rovers.
- 2009: Portsmouth deduced 9 points for going into administration.
So, is this sanction fair, and what could it mean for other clubs currently being investigated for significantly more serious breaches?
Is Everton’s 10-point dedication unfair or justified?
First and foremost, this 10-point deduction is subject to appeal, something Interim Chief Executive Officer Colin Chong confirmed will happen immediately after the sanction was imposed.
In a short video, Chong describes the points-penalty as “wholly disproportionate and unjust”.
Industry experts suggest the most-likely outcome is that this deduction will be reduced to six points on appeal, although these same experts were stunned at the severity of the punishment in the first place, so who knows!
On top of this, Leeds, Leicester and Southampton (relegated last season) as well as Burnley (relegated in 2022) are all exploring the possibility of suing Everton for loss of earnings. They have 28 days to do so.
So what is Everton’s defence?
Well, it’s worth mentioning that the £105 million figure does not include all expenditure.
Losses caused by the Covid-19 pandemic, expenditure on infrastructure, community projects or women’s and the academy is excluded, with the infrastructure aspect key in this case, given that they’re currently building a very expensive stadium at Bramley-Moore Dock.
However, to fund this, Farhad Moshiri, the owner, is providing the club with ‘interest-free loans’, which is essentially allowing him to plough money into the club, a loophole the Premier League aren’t too keen on.
Everton also blame Covid-19 for huge loses, specifically when it came to player-trading.
The club acknowledged that they were close to the threshold and claim, in summer 2020, they were planning to sell a number of key players to balance the books, but were unable to do so as the pandemic crashed the transfer market.
This is very difficult to prove while, on the contrary, huge sums of money were spent to bring in Abdoulaye Doucouré, Allan, Ben Godfrey and James Rodríguez (specifically his wages), with almost nothing recouped.
On a separate note, back in the summer of 2017, Everton broke their club-record transfer fee of £45 million to sign a player from a fellow-Premier League club.
In July 2021, an unnamed player - who cannot be named for legal reasons - was arrested “on suspicion of child sex offences” and, while no conviction was ever made, he never played for Everton again.
The club cite this situation as a mitigating factor, given that they had to pay the player around £10 million in wages throughout the final year of his contract, during which time he did not play, while any potential sell-on value he may have had evaporated.
Lastly, and the primary issue Everton have faced, relates to the Russian invasion of Ukraine.
Alisher Usmanov, long-time business partner of Moshiri, had been plowing huge sums of money into the club via sponsorship deal.
£75 million over five years was spent to rebrand the training ground ‘USM Finch Farm’, while over £200 million was pledged for the naming rights of the new stadium.
The second Russian tanks entered Ukrainian territory, Usmanov, a high-profile oligarch, was sanctioned, meaning these over-inflated sponsorship deals disappeared overnight.
Lastly, unlike some other clubs, Everton claim to have cooperated with the Premier League, something the league dispute, but all of these mitigated factors were thrown out by the independent commission.
The only one the commission did acknowledge is that Everton are now losing a lot less money than they were a few years ago, but that’s hardly the basis for a strong argument is it?
So we come back to the fundamental question, is a 10-point deduction a justified sanction? Does the punishment fit the crime?
Well this is a matter of opinion; in the EFL Championship, Sheffield Wednesday were deduced 12 points (6 after appeal), Derby 9 points and Reading 6 points all in recent times due to financial irregularities.
Many are suggesting Everton have been made an example of, with the Premier League seeking to quell any possibility of an independent regulator recommended by the Tracey Crouch report and elsewhere.
Whether you think this deduction is fair or not, it has set a precedent and, with apologies to all Evertonians out there, the most interesting aspect is what does this mean for other clubs?
What could the wider ramifications for other clubs be?
Everton’s own statement said: “The club will also monitor with great interest the decisions made in other cases concerning the Premier League’s Profit and Sustainability rules”.
They’re not the only ones!
That fact Everton have been deduced 10 points for one breach, when Manchester City have been hit with 115 charges, doesn’t so much open a can of worms as unleash a barrel full of poisonous vipers.
Back in February, the Premier League confirmed that City had been hit with 115 charges of breaking the aforementioned Profit and Sustainability rules, with these taking place between 2009 and 2018.
At their subsequent home match against Aston Villa, fans displayed a banner in support of Lord Pannick, the barrister leading Man City’s legal case, which remains one of the most unbelievable moment’s in football history.
This case is significantly more complex that Everton’s, meaning a verdict will take significantly longer to reach, but the 10-point deduction precedent has been set.
People have speculated, mostly fancifully, that Man City will be expelled from the Premier League, possibly the EFL too, while also retrospectively having titles taken away.
While this is along way off, the Everton verdict means the chances of seeing Haaland in the North West Counties League Premier Division have become slightly more likely; watch out Ramsbottom United centre-backs!
Before Manchester City came along, Chelsea were English football’s dominant force, bankrolled by Roman Abramovich.
At the time the oligarch was forced to sell the club to Todd Boehly and Clearlake Capital, Chelsea were recording loses of around £1 million a week.
Under the new regime, they’ve already spent £982 million on transfer fees across just three windows, recording a net loss of £667 million.
Right now, Chelsea are being investigated for the period of between 2012 and 2019, but if you believe that is when the rule-breaking began, you must thinks pigs can fly and that it says gullible on your ceiling!
Towards the start of the Abramovich-era, Arsène Wenger coined the phrase ‘financial doping’, which is even more applicable in modern-times.
Imagine if these clubs were found guilty of actual doping? There would be no debate, the harshest possible sanctions would be handed out.
Google ‘list of Tour de France winners’, and scroll down to the period between 1999 and 2005 and you’ll see that nobody won the tour in those years, despite the fact they happened and millions remember watching them.
Is this the way the Premier League is going? Twelve of the last 19 titles have been won by either Chelsea or Manchester City, so will all of these season’s have asterisks or retrospective champions?
Following the Calciopoli scandal, no one won Serie A in 2004/05, so will this be the case in English football, or will there be a spate of open-top bus parades in a few years time?
This Everton point-penalty has to be just the start, the first crack in a dam that’s seemingly about to burst.