Saracens are facing the “devastating” threat of being docked 35 points and fined over £5million for multiple breaches of Premiership Rugby’s salary cap regulations.
Club chairman Nigel Wray says the club, who are back-to-back Premiership champions and reigning European champions, will appeal against what they describe as “heavy-handed” punishments.
The launching of an appeal means the sanctions will be suspended.
Had the points penalty come into effect immediately, it would have left the team on -26 points after three games played in the early Gallagher Premiership standings.
Should the appeal fail and the original sanctions are upheld, the club are liable for the full £5,360,272.31 within 21 days of the decision under Premiership Rugby regulations – a huge financial penalty alongside the sporting sanction.
Wray said in a statement: “For over 25 years, I have put my heart and soul into the game I love. Together we have created something incredibly special with the Saracens family, both on and off the field.
“This is absolutely devastating for everyone associated with this amazing group of players, staff, partners and fans.”
An independent panel led by barrister Lord Dyson found the club had failed to disclose payments to players in each of the 2016-17, 2017-18 and 2018-19 seasons, and had also exceeded the ceiling for payments to senior players.
No details have been revealed on the size of the undisclosed payments or the recipients but Premiership Rugby’s investigations were thought to have centred around Wray’s involvements in companies such as VunProp Ltd (Mako and Billy Vunipola), Faz Investments Ltd (Owen Farrell), Wiggy9 Ltd (Richard Wigglesworth) and MN Property Solutions Ltd (Maro Itoje).
The panel was established after a nine-month Premiership Rugby investigation led to charges being brought in June. The panel upheld all the charges.
Wray added: “It has been acknowledged by the panel that we never deliberately sought to mislead anyone or breach the cap and that’s why it feels like the rug is being completely pulled out from under our feet. We will appeal all the findings.”
The club were founded in 1876 and have been the most successful English side of the last decade, winning five Premiership titles since 2011.
A separate statement from the club defended the use of co-investment arrangements with players, and stated that “PRL precedent already exists whereby co-investments have not been deemed part of salary in the regulations”.
The club admitted some administrative errors had been made that led to some transactions not being disclosed to Premiership Rugby, and apologised for those errors.
However, they added: “It is the club’s belief that the panel’s narrow interpretation of the regulations is detrimental to player welfare across the league and is damaging the development of elite level rugby in the UK.
Saracens is proud of its pioneering, innovative approach to player welfare, developing their talents and supporting their entrepreneurial spirit for life beyond rugby.”
The salary cap regulations were first introduced in 1999, soon after the dawn of professionalism in English club rugby, and are reviewed on an annual basis.
Premiership Rugby says the rules are vital for ensuring competitive balance within the league and to maintain financial sustainability.
The salary cap for the 2019-20 season is £7million, but clubs are allowed two ‘excluded players’ each whose wages are not restricted by the cap.
Premiership Rugby has not disclosed how much money Saracens were found to have breached the cap by, but under article 14.3 of the salary cap regulations it must exceed £650,000, which is the amount which triggers the maximum 35-point penalty.
Despite the club’s on-field success, the club posted an operating loss of £3.89million in their accounts for the year ending June 30, 2018. This was put down to a “tougher sponsorship and commercial environment” than the year before, when the losses were £600,000 less.
The 2017-18 financial report said a business restructure would “ensure a more effective and streamlined business” for 2018-19, but the imposition of this huge fine is clearly a major blow.