Written reasons published on Sheffield Wednesday's 12-point penalty. Will pick out some key points.
#swfc
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#swfc
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The EFL wanted a 12-point penalty for the overspend, while #swfc “a modest financial penalty” should be applied or a points deduction should not exceed 7 points in 2019-20 OR be applied in 2019-20.
The EFL accepted that, in principle, the sale of Hillsborough was an acceptable practice.
However, that #swfc failed to do so effectively is the reason why the club failed P&S rules.
So you can sell your stadium, but you have to do it right.
However, that #swfc failed to do so effectively is the reason why the club failed P&S rules.
So you can sell your stadium, but you have to do it right.
On timing, the EFL could have pursued earlier and more vigorously in 2018-2019 the issue of whether the sale of the stadium had been completed.
There were probably faults on both sides during that period, but it would be wrong to ascribe the whole of the blame to the Club.
There were probably faults on both sides during that period, but it would be wrong to ascribe the whole of the blame to the Club.
It was abundantly plain to the IDC that Charge 2 substantially extended the proceedings.
Charge 2 asserts that #swfc “sought to deliberately conceal from the EFL that the Heads of Terms had been backdated.”
Charge 2 asserts that #swfc “sought to deliberately conceal from the EFL that the Heads of Terms had been backdated.”
The IDC expressed concerns about the EFL investigation (or, more accurately, the lack of investigation) into these serious allegations before the charge was made upon #swfc.
Possible that had those fuller investigations been carried out the charge would not have been pursued.
Possible that had those fuller investigations been carried out the charge would not have been pursued.
Had the Commission been only dealt with the P&S charge against #swfc, the hearing could have been dealt with significantly earlier and some of the earlier procedural issues would have cleared the path for a yet earlier hearing also.
Here's the big one for Charlton fans.
In the absence of the EFL charge of deliberately concealing evidence, it possible a hearing would have taken place well before the end of the 2019-2020 season, as it was intended to be until the Covid-19 issue arose.
In the absence of the EFL charge of deliberately concealing evidence, it possible a hearing would have taken place well before the end of the 2019-2020 season, as it was intended to be until the Covid-19 issue arose.
It is “far from ideal” that relegation or promotion outcomes that are potentially to be affected by a points deduction that are announced only in the last few weeks of the season.
That the final #swfc 7 fixtures were played with an under-strength team was also a factor.
That the final #swfc 7 fixtures were played with an under-strength team was also a factor.
The general conclusion is the penalty should have been applied in the 2018-2019 season because it should have been clear, had the EFL made the correct checks, that the sale of Hillsborough had not taken place in the 2015-2018 accounting period.
The Commisson also felt the penalty should not be applied in 2019-20 due to "the actual or perceived inconsistency" with how the charge against Derby County was handled.
The Derby case, which is similar but has different aspects to the charges, still has no verdict.
The Derby case, which is similar but has different aspects to the charges, still has no verdict.
This is the timeline of events, and how it was mishandled.
Aug 2018: Chansiri agrees to buy Hillsborough to solve P&S issues to 2015 to July 31, 2018.
That month, the club and senior EFL representatives, and club auditors, agreed this was the solution.
Aug 2018: Chansiri agrees to buy Hillsborough to solve P&S issues to 2015 to July 31, 2018.
That month, the club and senior EFL representatives, and club auditors, agreed this was the solution.
Now this is the big issue.
Despite Heads of Terms agreements being lodged within 10 days, some 10 months or so later, issues arose about whether the #swfc arrangement was intrinsically valid.
The EFL decided that it was not and instituted the disciplinary proceedings.
Despite Heads of Terms agreements being lodged within 10 days, some 10 months or so later, issues arose about whether the #swfc arrangement was intrinsically valid.
The EFL decided that it was not and instituted the disciplinary proceedings.
The Commission rejected EFL accusations that Dejphon Chansiri gave evidence in a manner “apparently deliberately designed to make it difficult to follow or to assess his credibility”.
Or that “he appeared to exaggerate his difficulty in speaking English.” #swfc
Or that “he appeared to exaggerate his difficulty in speaking English.” #swfc
#swfc were placed under a transfer embargo after failing submit to the EFL by 31 March 2018 certain documents including a Profit and Sustainability Calculation and the Club's Future Financial Information.
Filed on April 25 which mentioned the intention to sell Hillsborough.
Filed on April 25 which mentioned the intention to sell Hillsborough.
However, #swfc said it intended to sell Hillsborough for not less than £40m by May 31, 2018.
The embargo was lifted, but then reapplied when the sale of the ground did not happen.
There is then a passage of email correspondence which sets the timeline.
The embargo was lifted, but then reapplied when the sale of the ground did not happen.
There is then a passage of email correspondence which sets the timeline.
It was made clear than #swfc would need, by the end of the accounting period, "a signed contract by both parties saying the [stadium] sale is unconditional".
Other ways to avoid the P&S breach were discussed, but nothing was put in place for the stadium sale before July 31.
Other ways to avoid the P&S breach were discussed, but nothing was put in place for the stadium sale before July 31.
Therefore, Commission states that "the only sensible construction to be placed on the situation as at the end of July 2018 is that the Club had breached the P&S Rules and that unless some retrospective action could be taken, there was no answer to an allegation of breach." #SWFC
EFL is criticised for not having set sanctioning guidelines until September 2018 - so clubs were unable to judge how any breach would be penalised.
But Commission is sure there was no agreement of sale in relation to the Stadium, oral or written, before 31 July. #swfc
But Commission is sure there was no agreement of sale in relation to the Stadium, oral or written, before 31 July. #swfc
The first draft Heads of Terms agreement for the sale of Hillsborough were dated Aug. 6. They were never executed.
Fresh HOT were drawn up on Aug. 15, and dated July 15.
Third HOT were drawn up on Aug. 16, again dated July 15. Lodged with EFL on Aug. 17. #swfc
Fresh HOT were drawn up on Aug. 15, and dated July 15.
Third HOT were drawn up on Aug. 16, again dated July 15. Lodged with EFL on Aug. 17. #swfc
The P&S charge is about whether the transaction reflected in the final version of the Heads of Terms could properly be included in the accounts for the period ending on 31 July 2018.
That the sale was not completed within 2-3 months of 16
August, 2018 is the issue for #swfc.
That the sale was not completed within 2-3 months of 16
August, 2018 is the issue for #swfc.
The Commission believes that #swfc only moved quickly on the issue of the sale, in June 2019, when the Club was pressed by the EFL for documentation that it should have provided within the P&S Rules by March 2019.
Issue is that July 15 date for the Heads of Term agreement is based upon on oral agreement, which carries no legal weight.
John Warner, #swfc auditor, says had he known no legally binding agreement existed he would not have accepted the sale in the 2017-18 financial statements.
John Warner, #swfc auditor, says had he known no legally binding agreement existed he would not have accepted the sale in the 2017-18 financial statements.
#swfc criticised because neither the Club nor the auditors took any informed legal advice about how an agreement for sale of the stadium to DC that was legally binding and effective as from before 31 July 2018 could be fashioned (and if it were legally possible).
Commission adds that the failure of DC to follow through with the Heads of Terms in the timescale envisaged at the time, and ultimately not proceeding with the purchase in his personal capacity, does throw into doubt whether he ever had the intention of proceeding. #swfc
The EFL accepted the #swfc audited accounts, and many have questioned how the club could then be charged.
IDC says whilst the EFL could theoretically take such a position even if it was demonstrably erroneous, it would be absurd and indeed the P&S Rules prevent it.
IDC says whilst the EFL could theoretically take such a position even if it was demonstrably erroneous, it would be absurd and indeed the P&S Rules prevent it.
On the charge of misleading the EFL, the EFL is criticised for bringing the charge because it was "concerned" about #swfc conduct.
IDC says this is not a fair or satisfactory way of articulating such an allegation and there was no convincing prima facie evidence.
IDC says this is not a fair or satisfactory way of articulating such an allegation and there was no convincing prima facie evidence.
Notes from a meeting in August 2018 did not see the light of day until January 2020. In handwritten notes from an EFL legal director is:
"irrevocable term sheet signed between the parties, longform to follow completion on x date”.
2/3 month window. Then not worried." #swfc
"irrevocable term sheet signed between the parties, longform to follow completion on x date”.
2/3 month window. Then not worried." #swfc
This relates to an indication from the club that the sale would be completed with 2-3 months in August 2018.
That is was not completed in this timeframe convinced the IDC the club was guilty of the P&S breach.
That is was not completed in this timeframe convinced the IDC the club was guilty of the P&S breach.
EFL legal rep says that what he “took away” from the meeting in August was that a binding agreement had already been signed.
Yet further emails between the EFL and #swfc made it clear this was not the case and there is no documented evidence of it.
Yet further emails between the EFL and #swfc made it clear this was not the case and there is no documented evidence of it.
And a key email from former EFL CEO Shaun Harvey after the meeting with #swfc on August 3. 
And from Katrien Meire on the need to backdate #swfc documents on the stadium sale.
This is the email that the EFL used to go after the club officials.
Yet the EFL knew the stadium sale hadn't happened and actively told the club to seek a solution which would be accepted by #swfc auditors.
So EFL was aware what the club would need to do, and encouraged it.
Yet the EFL knew the stadium sale hadn't happened and actively told the club to seek a solution which would be accepted by #swfc auditors.
So EFL was aware what the club would need to do, and encouraged it.
To underline that the EFL was complicit, an email from Shaun Harvey to Katrien Meire of #swfc about the stadium sale read:
“You need to move very quickly for this transaction to look credible - we are in your hands.”
“You need to move very quickly for this transaction to look credible - we are in your hands.”
All communications are consistent with the final Heads of Terms being concluded after 31 July.
The HOT was the contractual document that everyone assumed (wrongly) was sufficient to meet the relevant accounting standards.
The HOT was the contractual document that everyone assumed (wrongly) was sufficient to meet the relevant accounting standards.
This is a peach. Shaun Harvey (CEO) and Nicholas Craig (legal director) should have "applied their minds fully to the situation".
However, both were "either on holiday or going on holiday at crucial moments" and as such crucial scrutiny was missed by senior EFL officials. #swfc
However, both were "either on holiday or going on holiday at crucial moments" and as such crucial scrutiny was missed by senior EFL officials. #swfc
Katrien Meire believed the stadium sale was out of the picture by 3 August until meeting with the EFL, and it would have been obvious to everyone at the meeting that an agreement with retrospective effect would be required. The Commission accepted this. #swfc
#SWFC gets its knuckles wrapped at the end for treating P&S deadlines as "broad targets in a negotiating process".
Led to "misunderstandings, misconceptions and mistakes" and the back-dating of a document, while not dishonest, could easily lead to suggestions that it was.
Led to "misunderstandings, misconceptions and mistakes" and the back-dating of a document, while not dishonest, could easily lead to suggestions that it was.
Some #swfc fans have suggested the 12-point penalty could be reduced.
Points deductions are set by losses, and as the club were £18m over that's 12 points.
No new evidence can be presented at the arbitration panel, and SWFC offered no evidence in mitigation at the hearing.
Points deductions are set by losses, and as the club were £18m over that's 12 points.
No new evidence can be presented at the arbitration panel, and SWFC offered no evidence in mitigation at the hearing.
I find this sections quite remarkable, to be honest.
#swfc AND their auditors did not seek any informed legal advice on how a legally binding sale of the stadium could be agreed after July 31, 2018 to be effective before July 31, 2018.
#swfc AND their auditors did not seek any informed legal advice on how a legally binding sale of the stadium could be agreed after July 31, 2018 to be effective before July 31, 2018.
Had a lot of people refer to the EFL's failure to charge in 2018-19. There are three important entries here.
1. #swfc failed to submit P&S reports in the 2018-19 season
2a. The EFL should have pursued case with more vigour
2b. Probably faults on both sides during that period
1. #swfc failed to submit P&S reports in the 2018-19 season
2a. The EFL should have pursued case with more vigour
2b. Probably faults on both sides during that period
This is slightly confusing, because Birmingham had points deducted in 2018-19, on infringements in 2014-17.
By #swfc Commission's logic, Birmingham should have had points deducted in 2017-18.
Note the use of "ideally" though, on which season a club should be punished.
By #swfc Commission's logic, Birmingham should have had points deducted in 2017-18.
Note the use of "ideally" though, on which season a club should be punished.
