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Salary Cap Investigations

TRF_Olyy

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Which Tyler

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"In 2014, Sportsmail revealed that PRL had launched an inquiry into Saracens and Bath following allegations raised by a whistleblower.

PRL never confirmed the names of the clubs involved, but every side except Saracens, Bath and Leicester publicly denied their set-up was being investigated.

Later, it appeared as though only Saracens had been in the spotlight. The probe lasted nearly a year and came to an end when an out-of-court settlement was reached."
 

curtbob7

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About bloody time. Been going on for over a decade, anyone who still thinks Sarries are operating within the cap and on a level playing field with the rest of the Premiership is off their T*ts.

Its not just them though. I know when Manu had one of his contracts renewed at Tigers he had a house brought for him in some kinda back-handed way. Same with Sale and these Saffas getting penthouses in Manc.

Chuck in Wasps dodgy finances with Exeter getting by off their inflated sponsorship deals with the owners company and it doesn't make for good reading does it.

I think it was all just get brushed under the carpet and kept to a minimum again. Can see why English clubs do it though with what's going on in France.
 

RedruthRFC

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I can highly recommend the podcast that Egg Chasers recently did on the salary cap and possible ways around it. IIRC they mentioned the possibility of setting up businesses with players as a way of giving them value without the exchange of anything that would count against the salary cap. Re: other sides being under scrutiny, I think they said that the salary cap is policed by a peer review, so it's safe to say that all clubs' accounts are well monitored.
 

scotty507

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This is interesting that companies are set up shortly after contract signings, but is this making them money on the side

or is it when you retire you will have a mint in property if you stay with sarries. Technically no money will have changed hands this way.
 

TRF_Olyy

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Seems like it could be a loophole for money changing hands
Investment company set up by player and owner
Owner pumps money in to buy shares,
Dividends/sales pay out to to player
 

Lourens

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Would they get in trouble for that if it's a real loophole?
 

bushytop

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They should just take their money and invest in Wales regions... no salary cap :D
 

The Alpha Bro

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Are there no rules against paying players through shadow companies or agents of the club/owner? Or is it just the enforcers of the rule are turning a blind eye?
 

TRF_Olyy

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There are rules, but as walkinshaw says in the tweet thread above, it's very hard to prove.
Unless the player or club admitted it it's gonna go unnoticed if it's payments via random unrelated businesses
 

The Alpha Bro

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There are rules, but as walkinshaw says in the tweet thread above, it's very hard to prove.
Unless the player or club admitted it it's gonna go unnoticed if it's payments via random unrelated businesses
I thought so, one of the tweets in the thread threw me a little. Having rules like that and not employing PWC or a firm of the same ilk to be an independent investigator is more or less not having the rules at all, it has the same effect as asking nicely not to break the cap, absolutely mental system!
 

Tigs Man

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A lot of the cap loopholes got closed last season.
Hence why some squads went even smaller.
 

TRF_Olyy

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https://www.bbc.co.uk/sport/rugby-union/47889182

Sarries under further investigation for not declaring these business deals between the owner and the players,

Biggest news from that article is that Quins breached the cap last year, though!
They kept that one quiet!
 

Fuzzy Dunlop

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A few new articles on this: Daily Mail, Times - quoted below.

TL;DR: investigation has been referred to the independent body Sport Resolutions. Apparently this can only happen "where the salary cap manager is of the 'reasonable opinion' that there has been a breach of £350,000 or more or the club is deemed to have failed to cooperate." or "where there is an overrun of under £350,000 but the club opts to have the matter dealt with by a panel and where there is a dispute over the regulations themselves."


Times said:
Wales dropped from first to fourth in the world rankings at the weekend. A fortnight after being dismantled by England, Ireland have hopped up to second. Yet while it has become fashionable these past few weeks to poke fun at the randomness of the rankings, one of the best sides in the world doesn’t get a ranking and is not going to the World Cup. This is Saracens.

Just imagine how far Saracens could go in Japan. They have five of the England pack; seven of the starting XV. In a week, by which time all the World Cup squads will have been announced, they will probably have another six going with other nations. Will Skelton, the Australian, would be a seventh if he had not found his Saracens deal preferable. Elliot Daly is the starting full back for England but may only be third-choice No 15 for Saracens.

If we agree that they could compete at world level, we could probably agree that Saracens are phenomenally strong favourites to win the Gallagher Premiership again this season.
If/when they do they will have won five Premiership titles out of the past six.

You doubt that when CVC, the private equity firm, bought its 27 per cent share of the Premiership this year, it wanted to buy a monopoly. You would presume that it wanted a competition full of intrigue and knife-edge tension. The value of the competition is hardly going to rise if we already know who will be champions.

On to the salary-cap investigation, then. If Exeter Chiefs, Wasps et al cannot break Saracens, will it be this that finally does it?


You will recall that at the end of last season, Saracens were placed under “review”. Several players’ businesses were revealed in the media, particularly Faz Investments Ltd, a company run by Owen Farrell, Wiggy9 Ltd (Richard Wigglesworth’s) and VunProp Ltd (the Vunipola brothers’) all of which were launched with Nigel Wray, the Saracens owner, as a financial partner.

This demanded an answer to the question: is this not a smart way around the salary-cap rules? A payment in kind? Wray quickly issued a substantial, unyielding statement in which he sought not to deny these investments — quite the opposite, he said that they were within the salary-cap rules and that he was proud to be helping his players to become businessmen and invest in their futures in this way.

That is where we left the stand-off. Andrew Rogers, the Premiership salary cap manager, was left investigating it. The pressure is growing on him now because, five months on, the other clubs are chomping at the bit. The Premiership does not start until mid-October, but the Premiership Rugby Cup begins in three weeks.

Some clubs would love to see Saracens brought to their knees with a guilty verdict accompanied by a points deduction and severe reputational damage. Yet while none of them seems to be in a particularly forgiving mood, even if you attempt to take the emotion out, what they all need, before the season’s start, is clarity. Whatever the conclusion, it is hard to see how it cannot damage Saracens.

There are three most likely outcomes.

One: despite a well-resourced legal battle, Wray fails to show that his co-investments are not a benefit in kind that break the cap. Saracens are found to be in breach of the rules. The maximum penalty is a 35-point deduction.

Of longer lasting significance, then, is: what would happen to the squad? Saracens would have to re-budget fast to come down under the cap. There could be a reduction in player wages, a fire sale of players or Wray would have to sell his shareholding in his players’ companies. Maybe a bit of all three.


Two: Wray wins the legal argument and Saracens are found to be not in breach. At that point, suddenly, the salary cap has been detonated. It currently stands at £7 million. If every other club is informed that, legally, they can go into business with their players, like Wray, then the game has been immediately transformed. The ramifications are vast.

At that point, each club would have to decide whether or not they wanted to compete at this level. Money would rule. Wage inflation would rage. The southern-hemisphere nations have few defences to stop their players from being lured by the lucre of the north; they would now find it even harder to cope.

Three: Wray wins the legal argument and Saracens are found not to be in breach, but the reaction of the other clubs is to close the legal loophole. Wray could fight it and we would get into a further legal dispute. However, at some point, the votes of the other 12 clubs would beat the Saracens one. At what stage could those clubs just refuse to play against them?

The inside information is that, with the new season approaching, this is all soon to come to a head. Even if Saracens win this fight, though, it is hard to see how they do not lose.
 

Which Tyler

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A few new articles on this: Daily Mail, Times - quoted below.

TL;DR: investigation has been referred to the independent body Sport Resolutions. Apparently this can only happen "where the salary cap manager is of the 'reasonable opinion' that there has been a breach of £350,000 or more or the club is deemed to have failed to cooperate." or "where there is an overrun of under £350,000 but the club opts to have the matter dealt with by a panel and where there is a dispute over the regulations themselves."
Wow.
So we're left trying to work out if a club is trying tongetbthe reg.s thrownnout, or if someone has severely screwed up. Or both, of course.
Do we think this is related to the Saracen's setting up of property portfolios? Or have there been other rumours I've missed recently?
 

scotty507

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A few new articles on this: Daily Mail, Times - quoted below.

TL;DR: investigation has been referred to the independent body Sport Resolutions. Apparently this can only happen "where the salary cap manager is of the 'reasonable opinion' that there has been a breach of £350,000 or more or the club is deemed to have failed to cooperate." or "where there is an overrun of under £350,000 but the club opts to have the matter dealt with by a panel and where there is a dispute over the regulations themselves."
I really hope they dont say he hasnt done anything wrong and all clubs use it to entice more overseas players or we will just end up like France's top 14.
 

Fuzzy Dunlop

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Wow.
So we're left trying to work out if a club is trying tongetbthe reg.s thrownnout, or if someone has severely screwed up. Or both, of course.
Do we think this is related to the Saracen's setting up of property portfolios? Or have there been other rumours I've missed recently?

Aye, according to the journos this is specifically regarding the investigation in to Wray's co-investments with players.

As much as I'd love to grab my pitchfork and demand Sarries be punished (mostly due to envy...), my main concern is that the loophole is closed. Without wanting to be overly dramatic, the effects of these co-investments being sanctioned could be massive. Saracens fans should probably be worried too - just imagine the damage Lansdown could cause if he decided to take advantage. And who could blame him for doing so?

Now, where's that Tigers supporting billionaire waiting in the wings. I hear Jeff Bezos has a tattoo of Ben Youngs on his bum.
 

scotty507

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Aye, according to the journos this is specifically regarding the investigation in to Wray's co-investments with players.

As much as I'd love to grab my pitchfork and demand Sarries be punished (mostly due to envy...), my main concern is that the loophole is closed. Without wanting to be overly dramatic, the effects of these co-investments being sanctioned could be massive. Saracens fans should probably be worried too - just imagine the damage Lansdown could cause if he decided to take advantage. And who could blame him for doing so?

Now, where's that Tigers supporting billionaire waiting in the wings. I hear Jeff Bezos has a tattoo of Ben Youngs on his bum.
Im in the same boat. I want the loophole close regardless of pubishment.

If sarried have broken the rules laid down somewhere then get the pitchforks out but if they have exploited a loophole then they shouldnt be punished. It may not be fair what they have done but if nothing explicitly forbids them from doing it then well done them. But they will be screwed when the rules do come into place.
 

Which Tyler

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Im in the same boat. I want the loophole close regardless of pubishment.

If sarried have broken the rules laid down somewhere then get the pitchforks out but if they have exploited a loophole then they shouldnt be punished. It may not be fair what they have done but if nothing explicitly forbids them from doing it then well done them. But they will be screwed when the rules do come into place.
Yep. Closing a loophole should never come with retrospective punishment for the existence of said loophole.
As far as I can tell though, the property portfolio thing wasn't a loophole, but explicitly against the reg.s

Either way, the options would surely be
A] Loophole closed - Sarries need to comply within 2 years (doable without breaking contract law) - would be very interesting to see what effect that has on the squad. Are they close enough and winning enough to stay put with a 10% pay-cur all round?

B] Loophole made official, in which case the salary cap no longer exists and were in a financial arms race that currently, Lansdown wins and SH rugby dies
 
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