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How is Man City club’s financial fraud? (Part 3)

Also in the email, Chumillas explained that Man City is not operating as other teams. Typically, teams increase the revenue in a cycle. Achieving good results on the field, attracting more audiences, matches that are more interested on television and sponsors interested.

Businesses sponsor teams, and teams promote brands for businesses. This money is used to buy players, train kids or take care of the yard. If the team spends more than it collects, they lose. To make up for the losses, they had to cut costs.

But, Man City is not a normal team. Costs and debts do not matter. If they are at a loss, donors from Abu Dhabi pump money. They will only be punished if there is evidence. To circumvent the law from UEFA, Man City managers came up with clever ideas. “We can sign back on a cooperation agreement, to be paid in advance,” suggested Director Simon Pearce.

Pearce’s idea is to find a partner from Abu Dhabi to sign a sponsorship contract, pay in advance. The signing time was set back to a time in the past, to be added to the season financial report. Signing back dates is usually prohibited in financial transactions. But, if both businesses agree to sign the date back, this action is not prohibited.

CEO Ferran Soriano had the idea to ask the sponsors to pay the team a mandatory bonus if Man City won the FA Cup, despite the fact that they did not win.

10 days after the season is over, Chumillas announces the solution, which is a detailed change in the sponsorship contracts for the season that just ended. Etihad unexpectedly funded an additional £ 1.5 million, Aabar added £ 0.5 million and the travel agency sloped another £ 5.5 million. Man City and the sponsors have to do as they agreed on that amount from the beginning of the season.

Man City’s plan is to tear down the FFP. Owner money that is poured into a team is not considered revenue. If they recruit players with that money, they will soon lose money. But money from independent sponsors is considered revenue. It will offset the cost to Man City, to escape the FFP grip.

Man City’s financial statements are a series of deceptive information. They see FFP as a game in which Etihad Aviation (Etihad Airways) also participates. “Direct funding from Etihad is £ 8 million annually,” Pearce wrote in December 2013. At that time, the amount stated in the contract was £ 35 million.