Man City faces "fresh questions from UEFA in the wake of the Frank Lampard debacle" over how its extensive network of global companies is "sharing the burden of the club’s massive financial losses," according to Nick Harris of the London DAILY MAIL.
Man City was fined £16M by Europe’s governing body last year "for breaking Financial Fair Play regulations," had its transfer spending and wage bill limited and had to reduce its Champions League squad.
Since then, the club has announced it is "on course to meet UEFA’s new rules," having halved losses to £23M, £16M of which "would be discounted as part of the UEFA fine." However, UEFA "is examining whether the creation of a set of subsidiary companies by City’s ‘parent’ company, City Football Group (CFG), allowed them to under-report losses for 2013-14."
The lack of transparency over Lampard and his move, in which it was unclear whether he signed for N.Y. or Man City, "has thrown a spotlight on the opaque nature of City’s accounts, which some believe are designed to confuse." Two subsidiary companies, City Football Marketing Ltd. and City Football Services Ltd., "had operating expenses -- or costs, including wages" -- of £36.7M in the year to May, and posted combined losses of £25.9M. Most of their business "was done effectively on behalf of Manchester City" (DAILY MAIL, 1/10).
