Chelsea Football Club is once again in the spotlight, but not for its on-field exploits. In 2022, just as the new American ownership was poised to acquire the storied club, they were alerted to a significant issue that could influence their upcoming stewardship.

A confidential report revealed that during Roman Abramovich’s tenure from 2011 to 2018, Chelsea had engaged in undisclosed financial transactions with players, unlicensed agents, and various third parties. The origins of the report remain undisclosed by both Chelsea and the Premier League.

Furthermore, Chelsea proactively reported itself last year for violating the Premier League’s Youth Development Rules. These breaches, attributed to a former senior employee, involved improper registration processes for academy players spanning from 2019 to 2022.

The club’s failure to notify the authorities about these payments constitutes a breach of the league’s mandate to operate ‘in good faith.’ After the new ownership completed the acquisition, they promptly reported the matter, prompting an investigation by the Premier League.

What were the issues?

Chelsea had failed to make the authorities aware of the payments, which is a breach of the competition’s requirement to act ‘in good faith’. The new owners completed the takeover, self-reported and the Premier League launched an investigation. 

Its lawyers first looked at the information to determine whether, had it been declared, the monies involved would have put Chelsea in breach of Profit and Sustainability Rules (PSR). They ruled that it would not. The FA later launched its own probe.

Who was involved?

The devil is in the detail. Inside the Premier League’s findings, Chelsea admitted that between 2011 and 2018 payments totalling £47,524,925.74 were made by third party entities to 12 individuals or corporate entities. Of those, around £23m were made to seven unregistered agents over seven transfers. 

Five of those seven transfers involved Eden Hazard, David Luiz, Andre Schurrle, Nemanja Matic and Ramires.A further £19.3m was made to two entities in connection with the transfers of Willian and Samuel Eto’o. Around £1.4m was paid to third parties and should have been treated as renumeration to former sporting director Frank Arnesen, former scout and Abramovich advisor Piet de Visser and a further, unnamed individual.

Payments of £3.8m were also made in connection with one further transfer, with the player’s name redacted. Names can be held back when they refer to minors or for data protection issues.

Why did they do this? Who knows? 

None of those involved remain at the club to explain themselves. If one was to speculate, this would appear to be a rare example of the long-suspected policy within football of dishing out ‘backhanders’ to look after those involved in deals being brought into the public eye. Some would claim such behaviour is common practice, however, it is rare to see a club caught out as comprehensively as this.

What is the punishment?

Chelsea were fined £10m, a Premier League record, and handed a one-year transfer ban, suspended for two years. 

With regards to the academy breaches, they have been banned for nine months from taking players from other Premier League and EFL clubs. They can still sign players from abroad and hand out new deals to existing players. 

They have also been fined a further £750,000 and will pay the league’s costs. 

The FA investigation, into 74 alleged breaches of agent regulations remains ongoing. The Premier League acknowledged the new ownership’s co-operation throughout. Had that not been the case, the penalties would have been much more severe.