February 28 – La Liga president Javier Tebas has accused Manchester City of financial deception akin to that of Enron, claiming that the Premier League champions hide losses in different companies to improve the club’s finances.
Tebas (pictured) argued that the alleged practice has allowed the Abu Dhabi-owned club to report lower costs and gain an unfair competitive advantage by signing elite players and securing inflated sponsorship revenues.
“The City case is one where we believe they have put the losses on the companies that are not officially part of CFG (City Football Group),” said Tebas at the Financial Times Football Summit. “You remember the case in the USA, the Enron case. They put losses into different companies. These are similar cases.”
He referred to “scouting and marketing companies” that “have very high expenses”. He added: “They invoice City for less money. City has costs that are less than if they didn’t have this circle of companies around them.”
In 2001, Enron imploded amid a multibillion-dollar scandal, the biggest bankruptcy reorganisation in history. The American company used special purpose entities to hide their debts and increase their profits, fooling the investors and the public at large.
City didn’t comment on Tebas’s accusations.
The outspoken boss of Spanish club football also revealed that LaLiga have submitted a complaint to the European Commission over the club, claiming that the matter was currently being investigated.
“We have reported them to the EU. We have the facts and figures. The UK might not be part of the EU but City have commercial activities in Europe and in July 2023 the EU ruling said that they could look at state-aided companies, whether they are based in the EU or not.
“So we asked for City to be checked. It’s very important that all clubs are subject to the same transparency rules and governance on both the sporting and financial side.”
At home, Manchester City have been under investigation by the Premier League for 130 charges of rule breaches. City have always denied any wrongdoing.
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