Shock emails that could prove Manchester City DID cheat: Fresh evidence appears to show Premier League champions had millions funnelled into the club by Abu Dhabi to help inflate their income 

It was late morning on Tuesday April 12, 2011, when a senior executive within the sports sponsorship team at Etihad Airways composed an email to a business contact working in the 'partnerships' department at Manchester City.

It was a month before Manchester United under Sir Alex Ferguson would win their 19th English top-division league title, surpassing Liverpool's record of 18. Chelsea would be runners-up on 71 points that season, just ahead of City, also with 71.

City, then managed by Roberto Mancini, had extended their wait for a first title since 1968 to 43 years, but with a core of influential players including Joe Hart, Vincent Kompany, David Silva, Yaya Toure, Gareth Barry, James Milner and Carlos Tevez — joint winner of the Premier League Golden Boot along with Dimitar Berbatov — they appeared to be knocking on the door of a real renaissance.

New evidence claims Man City inflated income by millions to cheat the financial fair play rules

The Etihad exec began their email: 'Dear [XXX] … there seems to be some confusion about an outstanding balance of the sponsorship fee for the 2010/11 season.'

The Mail on Sunday knows the identities of both the sender and the principal recipient of the email but neither works for the same company any more and both moved to different spheres of business.

'As you are aware,' the writer continued, 'Etihad's commitment is for £4million and the remaining balance (£8m) is handled separately by the [UAE] Executive Affairs Authority. Please can you clarify this to your accounts department and pick it up direct with the EAA in due course. Kind regards.'

To put this into context, The Mail on Sunday has been told — and has seen corroborative paperwork — that Manchester City invoiced Etihad for £12m for the 2010-11 shirt sponsorship deal, but the invoice had a hand-written annotation that Etihad themselves were only due to pay £4m that year.

Further to that, sources say, and documents show, is that the City-Etihad shirt deal at the time — signed by City's then CEO, Garry Cook, and Etihad's CEO, James Hogan — would cost Etihad £4m in the 2010-11 season, having cost them £3m the season before, and then £4.5m in 2011-12.

The EAA, who were picking up the difference between the headline £12m in 2010-11 and the £4m Etihad were paying, are according to their website 'a specialised government agency mandated to provide strategic policy advice to the Chairman of the Abu Dhabi Executive Council, His Highness Sheik Mohamed bin Zayed Al Nahyan, Crown Prince of Abu Dhabi and Deputy Supreme Commander of the UAE Armed Forces'.

Correspondence seen by the MoS and supported by contemporary paperwork suggests Etihad were not in fact paying the amounts City were invoicing for but a UAE entity serving Sheik Mohamed was.

City have allegedly benefited from abnormally high sponsorship details from entities based in the UAE, in deals that appear to have contravened FFP rules. If money was being funnelled into City to artificially inflate their income for years, that would be a problem.

And various emails and documents obtained by Football Leaks and/or this newspaper suggest that happened. The Premier League announced an investigation more than two years ago but that has so far been delayed by City's actions in court. City have declined to clarify multiple issues around this. 

Fast forward to early summer of 2014 and a source close to City emailed the MoS and claimed that Etihad's 10-year £340m sponsorship with City was not in fact mainly funded by Etihad but rather through Etihad and that a state entity was picking up most of the tab.

Around the same time — and this is when City had just been found guilty of breaking UEFA Financial Fair Play [FFP] rules for the first time — the MoS was made aware of some disquiet within Etihad's sports sponsorship team about the airline's relationship with City. A source who knows an employee on that team said the airline's targeted sports sponsorship deals to then had followed the same formula.

This involved relatively low spending on tie-ups with teams or venues in places where sports franchises were either on Etihad flight paths to major airports (Harlequins rugby, both codes, on the Heathrow flightpath; and in Melbourne, in football and Aussie Rules, on the Melbourne flightpath), or would be in flight paths (tie-ups in New York soccer, and three sports teams in Washington, all of which happened). 

While Manchester airport is an Etihad destination, there were private concerns Etihad should not be doing a huge-money deal with one club if the targeted strategy to date was going to be consistent, sources say.

The MoS spoke to City in summer 2014 about the allegations and was told they could not be confirmed by the club. The sources declined to go on the record and no story ran. 

Fast forward again to summer 2020 and City had been banned from the Champions League for two seasons by UEFA for, among other things, 'disguised funding' of sponsorship deals, in other words, for saying a sponsor was paying 100 per cent of an agreed endorsement when in fact another entity was picking up some of the tab.

The case was now at the appeal stage at the Court of Arbitration for Sport (CAS) and among those giving evidence on behalf of City was Simon Pearce, who holds multiple posts within the entities that ultimately run City.

Pearce is a non-executive City director and on the board of parent company, City Football Group (CFG), which also owns Melbourne City, where he is the vice-chairman. He is also a director of several City subsidiary companies as well as a senior adviser to the UAE's Executive Affairs Authority.

At the CAS tribunal last year, Pearce was asked: 'Have you ever arranged any payments to be made to Etihad in relation to its sponsorship obligations of Manchester City Football Club?'.

He answered: 'Absolutely, categorically not.'

The official CAS verdict document reported: 'Mr Pearce did not strike the panel as being an unreliable witness and indeed upholding UEFA's allegations would necessarily require a finding that his testimony was false. The panel does not find such conclusion to be warranted in the absence of evidence being presented by UEFA that Mr Pearce in fact represented ADUG [a company controlled by Sheik Mansour].'

Yet days after the CAS verdict cleared City of 'disguised funding' and handed them a fine of 10million euros for non-cooperation with UEFA, the German magazine Der Spiegel published hitherto unseen material that suggested Pearce had provided evidence to CAS that conflicted with previous claims.

The whole case against City by UEFA had started with the publication in 2018 of a series of emails by Der Spiegel purporting to show wrong-doing by City. The ongoing Premier League investigation into City is based on the same Der Spiegel materials.

The post-CAS bombshell email published by Der Spiegel last year is dated December 16, 2013, from Pearce (using his EAA email address) and sent to Peter Baumgartner, then the chief operating officer (COO) of Etihad. As our graphic shows, Pearce appears to be admitting that he had in fact arranged a payment to Etihad in relation to its sponsorship obligations to City.

The email details how 'we' (City) 'should be receiving £99m — of which you [Etihad] will provide £8m. I therefore should have forwarded £91m and instead have sent you only £88.5m. I effectively owe you £2.5m.'

The Mail on Sunday has asked the club a series of questions arising from this correspondence and they declined to answer any specific queries. Instead they pointed us to previous statements.

In relation to the Pearce email, they said: 'The questions and matters raised appear to be a cynical attempt to publicly re- litigate and undermine a case that has been fully adjudicated by the Court of Arbitration for Sport.'

The club have also claimed of Der Spiegel's reports over years: 'The attempt to damage the club's reputation is organised and clear.' Asked to confirm who has organised this, a City spokeswoman failed to respond. 

After last week's rulings by three of Britain's most senior judges that City have stymied the Premier League's investigation, City said: 'We respect the decision of the Court of Appeal regarding the arbitration matter. This decision relates to ongoing proceedings and we are not in a position to provide comment until those proceedings are complete.'

City's position then is that they have broken no rules. Yet now it can be revealed that, in an argument the club put before a court, they admitted the Premier League apparently suspected there was evidence of wrongdoing. 'The Premier League contends that the [media] reports contain information suggesting breaches of the rules,' said City's legal team.

The Premier League declined to respond to questions and their last comment on the subject, in 2019 and still applicable, is that their investigation is ongoing.