Conspiracy Theories and Innuendo will not prove the alleged Manchester City Conspiracy

There will be no Super Sub for cogent evidence

Last week, more claims emerged about Manchester City’s sponsorships in 2012 and 2013 from Etisalat, a major international telco group headquartered in Abu Dhabi with a market capitalisation of $52 billion. Undoubtedly, such matters will form a central part of the Premier League’s “115” (in reality, Manchester City are alleged to have broken 129 rules over 13 years) charges against Manchester City.

It once again highlighted that those so determined to see Manchester City face “justice” feel the need to make their case by blurring the lines between allegation, evidence, innuendo and outright conspiracy theory. It serves as a stark reminder of the seriousness of the allegations made and, therefore, the strength of evidence that will be required to prove the case against them.

This dry subject somehow captured the attention of TalkTV’s Piers Morgan’s nightly show attracting a high-level panel including leading journalists, a current MP and the former Chairman of Arsenal Football Club. Morgan’s pre-show publicity and live graphics proclaimed the revelatory nature of this 10-year-old “breaking” news story. The show itself fell flat, not helped by David Dein, an experienced football operator at Arsenal and beyond, declaring that he didn’t think the story was “much of a smoking gun” before praising the club for doing a “sensational job not just for themselves but for the Premier League.”

Shortly before broadcast, The Times released a related article explaining that it had seen a leaked UEFA report which suggested that “a mystery figure from the United Arab Emirates” had paid Manchester City a total of £30 million in 2012 and 2013. The leaked report was, in fact, the never previously released findings against Manchester City from UEFA’s Adjudicatory Chamber when it banned the club from its competitions for 2 years in 2020. The ban and UEFA’s judgment was later overturned at the Court for Arbitration for Sport (CAS) although Manchester City were fined €10m for their failure to cooperate.

In addition, as Morgan’s show aired so did a one-hour documentary on YouTube produced by Surise Limited, a British Virgin Islands entity created on 9 June 2023. The video contained no credits, although earlier this week, they were added to the description on YouTube. The documentary’s Executive Producer was Philip Armstrong-Dampier who describes himself as Managing & Creative Director at PZ Productions, a company of which Armstrong-Dampier is the sole shareholder but which did not take credit for the YouTube video. Journalist Philippe Auclair, a long-time critic of state ownership in sport, commented on Twitter that he “would very much like to know who funded this documentary.”

The obviously well-funded production included interviews with journalists from numerous international publications and the President of La Liga, Javier Tebas, another vocal critic of Manchester City, state ownership in football and CAS. Tebas stated in the documentary that: “it was clear that Manchester City were cheating with its commercial income and were deflecting from [their] losses.” Also featured, were a number of anonymous, blurred out former officials of UEFA and CAS itself.

Not revelatory at all

What was striking about the “revelations” was that they weren’t, in fact, new or disputed. In July 2020, The Guardian reported that Manchester City themselves acknowledged to UEFA that the club’s owner, Sheikh Mansour bin Zayed al-Nahyan, had arranged the £30m Etisalat payments.

The article went on to state that, notwithstanding Manchester City’s denial of the purpose of those payments, they were key to the Adjudicatory Chamber’s finding that Manchester City had “overstated [its] true” sponsorship revenue. CAS’s own detailed 93-page judgment released in July 2020 also set out UEFA’s Adjudicatory Chamber’s position in respect of Etisalat and another Manchester City sponsor, Etihad Airways saying: “the sponsorship revenue of MCFC, as disclosed in its accounts and as declared to UEFA, considerably overstated the true revenue and income of MCFC between 2012 and 2016.”

Ultimately, CAS made no finding on Manchester City’s sponsorship with Etisalat dismissing those claims as time barred under UEFA’s 5-year limit. That is not to say the matters were not considered at CAS. Both parties had made detailed written submissions on substance of that matter and Manchester City called a Senior Vice President in the Contracts and Administration Department of Etisalat who gave witness evidence to CAS under oath. His evidence was that the allegations were "ridiculous" and that the sponsorship had "delivered excellent returns" and outperformed expectations.

The commonly (mis)quoted line is that Manchester City will not be able rely on any statute of limitations in its case against the Premier League. However, the Premier League Rules are, in fact, expressly stated to be construed in accordance with English law which, with the usual nuance of statute of limitations debates, will impute a six-year time bar. Time will tell how the Premier League’s Independent Commission establishes the time boundary of charges to adjudge. In the absence of the Independent Commission finding that Manchester City concealed the true nature of the very historic matters, it is hard to see how alleged breaches in 2012 and 2013 will not be time barred again.

Success, questions, doubts and innuendo for 15 years

The secretly funded YouTube documentary is a further illustration of what has been a constant theme of the past 15 years for Manchester City. At the start of the 2008/09 football season, City was acquired by Sheikh Mansour and is now part of the 13 club City Football Group (CFG) whose principal activity is the operation of football clubs around the world. Since inception, it has attracted investment from private equity in China and the US. Silver Lake, the leading Silicon Valley private equity fund, now owns approximately 20% of the CFG and its billionaire founder and co-CEO, Egon Durban, sits on CFG’s board.   

Throughout the ownership of Sheikh Mansour, Manchester City’s commercial growth and success has been questioned by opposition clubs and a determined section of the sports media. On the pitch, City have dominated the Premier League for much of the last decade. Commercially, revenue has grown from a tiny base in 2008 – its total revenue to 31 May 2008, just prior to the takeover by Sheikh Mansour, was £82.3m with just £25.4m coming from commercial activities. Continued growth in the year just ended will see Manchester City exceed revenue of £700m on the back of its historic on-field Treble which culminated in winning the Champions League for the first time in the club’s history in June.  Moving forward, this week, City have announced some of the largest sleeve and training kit sponsorships in football with OKX, the crypto exchange, and Asahi, the global beverage firm. These deals alone are estimated to be worth close to a combined £40m per annum.

Of course, Manchester City’s detractors will question the veracity of their financial accounts in terms of both revenue and expenses. Although Manchester City do not declare any sponsorships from related parties in its audited accounts, debates have raged for years as to whether sponsors such as Etihad, Etisalat, Aldar and others should properly be classified as related parties and, therefore, subject to fair market value review by the Premier League and UEFA. Following the takeover of Newcastle United by Saudi Arabia’s PIF, the Premier League hastily introduced broad rules designed to regulate a wider range of “associated” sponsors and to test any such contracts over £1m per annum for fair market value.

Allegations that Manchester City had failed to properly disclose related party sponsorship were made by UEFA in its financial fair play investigation in 2014. At that time, Manchester City’s submissions for the 2012 and 2013 financial years were questioned in relation to £120m of sponsorships from Etisalat, Etihad, Aabar and the Abu Dhabi Tourist Authority.

In short, UEFA’s expert concluded, contrary to Manchester City’s audited accounts, that Etihad, Etisalat and Aabar were all related parties of the club. UEFA further concluded that whilst Manchester City’s biggest sponsorship deal, Etihad, was not above fair market value, the agreements with Etisalat and Aabar were. Manchester City disagreed vehemently and the matter was resolved by way of a settlement agreement under which Manchester City undertook to repay €60m from its 2013-14 Champions League revenues and other non-monetary penalties. The settlement agreement expressly stated that Manchester City did not accept that they had breached FFP.

Email hacks - Esoteric accounting detail becomes allegations of serious multi-year conspiracy

In 2018, Der Spiegel’s Football Leaks comprising hacked emails changed everything. On the back of a chorus of opposition clubs demanding action, UEFA homed in on six emails that suggested issues beyond whether certain entities in Abu Dhabi were related parties or not. In short, on the back of those six emails, UEFA’s Adjudicatory Chamber found that Sheikh Mansour had entered into "arrangements" and/or a "scheme" to make payments through Etisalat and Etihad that were, in fact, "disguised equity payments" and that the true nature of these payments was “deliberately concealed and improperly reported.”

As Manchester City themselves put it in their written submissions to CAS, denying the breaches: “These very serious allegations necessarily involve a conspiracy on the part of MCFC, its shareholder, and these two sponsors. They are denied in the strongest terms, including by very senior witnesses from both Etisalat and Etihad. The allegations are irreconcilable with the factual evidence of what actually happened, as verified by respected international accounting firms.”

In the face of such serious allegations, CAS concurred with Manchester City that to find for UEFA would require a conclusion that the evidence of several high-ranking officials of large international commercial enterprises was false and that some would be subject to criminal sanctions. Furthermore, CAS said that UEFA’s theory would also mean that not only had Manchester City lied to the FA and UEFA, but also that accountancy firms such as BDO, Deloitte, Ernst & Young and AlixPartners, who had examined/audited the accounts of one or more of the entities involved, were all misled. Unsurprisingly, CAS could not make that finding off the limited email evidence before it and, therefore, found in Manchester City’s favour stating more than 10 times that it could find “no evidence” to support most of UEFA’s allegations.

Conspiracy theories persist

Much of the YouTube documentary released last week questioned UEFA’s competence, CAS’s impartiality and, surprisingly, UEFA’s appetite for the fight. Most of these criticisms are, in fact, thinly veiled conspiracy theories.

Mr Tebas and another commentator in the documentary questioned whether the Chairman of the CAS panel, Mr Rui Santos, a leading and experienced lawyer and regular CAS arbitrator, was impartial given that he “functions in the heart of companies that have petrol and gas interests.” In fact, he is merely a Partner in a law firm with some clients in the oil and gas sector. Time was also given to the false allegation that Manchester City selected Mr Santos and a second member of the CAS panel. In fact, according to the CAS judgment, both Manchester City and UEFA proposed Mr Santos as mutually agreeable and the ultimate decision was that of the CAS Court Office.

On 3 April 2020, the CAS Court Office informed the parties that, pursuant to Article R54 CAS Code, following consultation with the parties and the co-arbitrators, the Deputy President of the CAS Appeals Arbitration Division appointed Mr Rui Santos as President of the Panel.

Mr Tebas went further stating that “a part of UEFA didn't want the sanctions on Manchester City for economic reasons” inferring certain internal forces had let City off for commercial reasons.

Further doubts were raised about the lack of any appeal by UEFA. Although there was no realistic prospect of success of an appeal to the Swiss Tribunal (appeals against CAS are only available in very limited circumstances and rarely succeed), the inference was that the decision of UEFA not to pursue one was mystifying or, perhaps, corrupt. Aleksander Čeferin, President of UEFA was criticised for attending a Manchester City match.

Serious allegations require serious proof

In English law, the general starting point in cases of this type is that people do not usually act dishonestly. It is well established that cogent evidence is required to justify a finding of discreditable conduct, reflecting that it is considered generally unlikely that people and organisations will engage in such conduct. This inherent improbability means that, even on the civil standard of proof (balance of probabilities), the evidence needed to prove it must be all the stronger. The Independent Commission will also need to be mindful of the seriousness of the allegations made by the Premier League against the many individuals implicated as well as the seriousness of the consequences, or potential consequences, of the proof of the allegation for those individuals because of the improbability that a person would risk such consequences.

Broadly, the Independent Commission will adhere to the way CAS considered the point – it said in its judgment: “considering the particularly severe nature of the allegations in the present proceedings, the evidence supporting such allegation must be particularly cogent.”

Putting to one side the charges of non-cooperation which may well be less binary, each of the main areas of charge in the Manchester City case require a deliberate, multi-party conspiracy to be proved. A proven case would mean Manchester City’s audited accounts were materially misstated for more than a decade. No high profile English company has ever restated ten years of its accounts, indeed it is unlikely to be practical to do so.

Some of the allegations are centred around the reduction of reported expenses via the use of illicit side payments to a former player and manager, Yaya Touré and Roberto Mancini. These would necessarily have to have involved Touré, Mancini, their respective agents, Manchester City and a number of its executives and, in the case of Mancini, Al Jazira Sports and Cultural Club and its former CEO, Phil Anderton. All would have to have been intent on deliberately concealing the alleged real arrangements. It is highly unlikely that the Premier League would have any witnesses of fact (i.e. whistleblowers) able to demonstrate that some or all of these parties had carried out this alleged scheme. All the parties have publicly denied any wrong doing and it is unlikely that the Premier League will be able to compel the third parties (such as Touré, Mancini and Seluk) to disclose their documents. So what sufficiently cogent evidence will the Premier League be able to furnish?

Proving that the declared international sponsorship agreements with Etisalat and Etihad were false and that the disclosures to the many professional firms who have looked at the club’s financial and legal information over the last decade were deliberately and systematically incomplete (at best), will be even more challenging. In short, it is likely that the Premier League will only be able to prove its case by convincing the Independent Commission that certain of the senior executives who gave witness evidence under oath to CAS were lying and, therefore, committing perjury. At least some of those individuals are likely to give evidence again under oath to the Independent Commission - again the Premier League will need to show that those witnesses are not credible nor telling the whole truth. It is hard to see how there could be a middle ground.

The Premier League has made the most serious allegations imaginable against Manchester City. It has spread its allegations, either directly or indirectly, across multiple entities (commercial and governmental); a sovereign nation and members of its Royal Family; and numerous senior and experienced professionals. It has suggested that the wrongdoing has been deliberate and lasting, at least, a decade. It is putting to an Independent Commission a case that in the English Courts would take many months to hear.

So, whilst tabloid-style proclamations about how clear and obvious the case against Manchester City is may attract YouTube views, clicks and sell newspapers, proving the allegations will require far more evidence than creative, circumstantial and subjective conspiracy theories.