English and European champions Saracens have been docked 35 points and fined over £5 million ($6.5 million) for breaching the Premiership Rugby salary cap over several seasons, Premiership Rugby announced on Tuesday.
Saracens – who provided nine of the England squad including captain Owen Farrell that reached last Saturday’s Rugby World Cup final – had been subject to a nine-month investigation.
The club immediately announced they would file an appeal against the sanctions.
Following a five-day hearing in September and October, an independent three-man panel, headed by a distinguished former judge, adjudicated that Saracens had contravened the salary cap which is set at £7 million a year.
Premiership Rugby has not disclosed how much money Saracens were found to have breached the cap by, but under the salary cap regulations it must exceed £650,000, which is the amount which triggers the maximum 35-point penalty.
“The decision of the Independent Panel is that Saracens Rugby Club failed to disclose payments to players in each of the seasons 2016-17, 2017-18 and 2018-19,” read a statement from Premiership Rugby.
“In addition, the Club is found to have exceeded the ceiling for payments to senior players in each of the three seasons. The Panel therefore upheld all of the charges.”
Saracens who topped the Premiership table last season with 78 points – before going on to beat Exeter in the final will begin the fourth round of matches on -26 points.
Newcastle Falcons finished bottom last season with 31.
“The Salary Cap Regulations stipulate that a points deduction may be imposed in the current season [2019-20] only,” read the statement.
“The sanction has no bearing on any other domestic or European competition.”
Saracens chairman Nigel Wray, who has been the driving force of the club since 1995 the advent of the professional, said in an emotional statement they would be launching an appeal.
“For over 25 years, I have put my heart and soul into the game I love,” he said in the statement published on their website.
“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.
“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.”
Wray and Saracens will have a very narrow remit in terms of their appeal to an arbitration body.
“The review can only be on the basis that there has been an error of law, the decision is irrational or that there has been some procedural unfairness,” read the Premiership statement.
“In the event that Saracens Rugby Club seeks a review, the sanctions will be suspended pending the outcome of that review.”
Saracens have dominated domestic and to a certain extent European rugby in the past decade winning the Premiership five times and the European trophy on three occasions.
Their squad reads like a who’s who of English rugby with Farrell, Maro Itoje and Jamie George to name but three whilst they also have other World Cup stars in Wales’s Liam Williams and Scotland’s Duncan Taylor.
The club posted an operating loss of £3.89 million in their accounts for the year ending June 30, 2018 and Tuesday’s judgment, if upheld, will bring huge pressure on the club to be able to retain some of those stars.
It is believed the investigation surrounded Wray’s involvement in companies such as VunProp Ltd (Mako and Billy Vunipola), Faz Investments Ltd (Farrell) and MN Property Solutions Ltd (Itoje).
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 but remained unapologetic over its approach to looking after their players.
“Saracens is proud of its pioneering, innovative approach to player welfare, developing their talents and supporting their entrepreneurial spirit for life beyond rugby.”