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Football Leaks and Der Speigel Investigation: Game at the Heart of a New Era of Manchester Capitalism

Football Leaks: In a four-part investigative report, German publication Der Speigel shed light on the current owners of Manchester City Football Club and their attempts to circumvent financial fair play (FFP) regulations put in place by UEFA.
Manchester City FC owner Sheikh Mansour bin Zayed al Nahyan

According to documents from Manchester City FC’s chief financial officer, Jorge Chumillas, it appears that Sheikh Mansour bin Zayed al Nahyan paid large parts of inflated sponsorship deals himself, via the holding company, Abu Dhabi United Group.

‘Everybody knows the fight was fixed. The poor stay poor, the rich get rich,’ voiced Leonard Cohen in Everybody Knows (1988). The acclaimed poet and musician had no interest in football, at least not one publicly recorded. His work, though, is considered a subtle and poignant critique of society often addressing war, injustice and the American economic model. It is perhaps unsurprising, given this context, that Cohen’s words fit just as easily into a critique of 21st Century, big-money football.

Football Leaks is a multinational investigative project involving several publications and dozens of journalists examining millions of documents relating to financial agreements and transactions entered into by some of the biggest clubs, associations, players, agents and investors in European football. German publication Der Spiegel filed a four-part series on Manchester City on its website last week saying, “The once-mediocre club from East Manchester is currently the best team in the Premier League, a glitzy product that has become a fantastic advertisement for Abu Dhabi. Refined strategists like Kevin De Bruyne and Ilkay Gündogan play for the team, along with the electric Leroy Sané, all under the leadership of perhaps the best trainer in the world, Pep Guardiola. It’s a one-of-a-kind success story. Now, though, documents made available by the whistleblower platform Football Leaks expose the dirty tricks behind the team’s success.”

The focus of the series is on the current owners of Manchester City Football Club and their attempts to circumvent financial fair play (FFP) regulations put in place by UEFA. The leaks make one thing clear: football may be the beautiful game but its financial structures and transactions, far more of which are hidden from both the public and regulators, point in a very different direction.

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FFP was put into place with the idea to prevent clubs from gaining an advantage by running up debts that would never be paid back and thereby running themselves into the ground. Spend as much (actually a little more)  as you earn, was the basic idea. A flawed one from the beginning, because if you forced that thought, then growth (financial, commercial, footballing quality) would be restrictive. The gap between the big clubs and the smaller ones would never be breached, and in all probability widen more as the years went by. The poor stay poor, the rich get rich.

A liberal interpretation of these rules, aided by FIFA president (then UEFA president) Gianni Infantino helped clubs funded by middle eastern royals (Manchester City and Paris Saint-Germain are the most visible) inject more money into these clubs, and push them further up the table than ever before reports Der Spiegel.

A simple example — clubs usually pay players for their image rights. According to Der Spiegel, City saved around €30 million by setting up a shell company to pay players for their image rights, thereby keeping that spend off its own books.

Another smooth way to generate marketing income that balances the books? Sheikh Mansour bin Zayed al Nahyan paid large parts of inflated sponsorship deals himself. Documents from City’s chief financial officer, Jorge Chumillas, appear to show the Abu Dhabi United Group, Mansour’s holding company which also owns City, directly paid £59.5m of Etihad’s annual sponsorship, with only £8m coming from the airline.

It must be made clear here, right now, that the story and the leaks and its repercussions are still just allegations with the case still developing. City have obviously denied the initial allegations with a vague statement that focussed more on the hacking of material from their personnel rather than the content of the material itself. In a pre-match press conference Pep Guardiola City’s manager said of the allegations, “We want to follow the rules, but I am a manager. I don’t know what happened”.

One thing has been clear to everyone who follows European football’s top tier: FFP is flawed. Many, in fact, view it as a complete failure. In the initial days, they banned clubs from transfer activity because of financial irregularities that showed they had broken FFP rules. Soon enough, the loopholes became evident.

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Barcelona, for example, signed Arda Turan from Atletico Madrid at a time when they were banned from transfers. They reached an agreement with Atletico but only paid the money when the period of injunction was passed. Turan did his bit by sitting on the sidelines for five months before he finally got to play a competitive game for the Catalan club.

PSG, in a similar exercise, took Kylian Mbappe on loan so that they could avoid breaking FFP rules. Once the FFP assessment period was reset, the signing was made permanent. When the Paris club signed Neymar, one assumed the game would finally be up. Surely his salary wouldn’t, couldn’t, be justified by a club with moderate attendance figures (they have obviously climbed once he came on) and a trophy cabinet housing little more than the two-horse Ligue 1 trophy.

Turns out that was not the case. PSG broke Neymar’s salary down to bonuses. The Brazilian actor/footballer reportedly receives a bonus of €375,000 a year for waving at fans. It is the commodification of the last inch of a footballer’s being and of every aspect of the sport itself.

Cohen’s critique has turned on its head. The line could now serve as the motto for UEFA, FIFA and FFP itself. The poor stay poor; the rich get richer.

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In all this, the extreme tribalism of football fans means that on comment boards across the web, furious fights are raging, with City fans defending their club and claiming these latest allegations are designed to stop City from doing what they seem to be doing so very easily: winning.

Over time, City fans will have the opportunity to seriously examine these allegations and their implications, not just for a handful of clubs, for the game at large. It is never easy to admit being taken for a ride. But that may be the first step en route to stopping the rot.

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