The Week in Breakingviews: Britain’s soccer sham

HSBC Holdings

02/10/2026 17:05

The author is a Reuters Breakingviews columnist. The opinions expressed are his own.
By Peter Thal Larsen
LONDON, Oct 3 (Reuters Breakingviews) - Welcome back! Yields on government bonds are hitting fresh highs across the developed world. We got a glimpse of Anthropic’s filing as it revs up for a possible $2 trillion IPO. Yet the most jaw-dropping document released this week was the report of the independent commission investigating Manchester City’s breaches of the English Premier League’s financial rules. More on that below. Let me know what you think. (If this newsletter was forwarded to you, sign up here to get it in your inbox every weekend.)
OPENING LINE
“Economist Adam Smith noted that the butcher, the brewer and the baker don’t provide food out of benevolence, but from their own self-interest. The idea has ​taken a modern twist with Nvidia NVDA.O to enhance AI safety.”
Read more: Jensen Huang’s invisible hand is tied on AI safety
FIVE THINGS I LEARNED FROM BREAKINGVIEWS THIS WEEK
Just over 20% of US bank deposits pay no interest. (AI agents are coming)
Goldman Sachs GS.N shares have quadrupled under current boss David Solomon. (Beating his predecessors)
Production of humanoid and quadruped robots is doubling every 6 and 10 months. (Expect lots more dealmaking)
Just 1.1% of Chinese sovereign debt is held by overseas borrowers. (Time to export debt?)
Three-quarters of Brazilians backed a ban on online betting in a recent poll. (Could catch on)
THE BEAUTIFUL SHAME
Imagine a widget maker is sold to a new owner. Eager to expand, the ambitious proprietor splashes out on state-of-the-art machinery. The company’s improved widgets attract widespread praise and win many awards. However, sales do not keep up with the investment and the business suffers heavy losses.
Embarrassed by the red ink, the owner asks friendly business partners for help. Perhaps they could boost his sales by buying some products? The partners want to be supportive but cannot justify paying such high prices. So the owner gives them the necessary cash. The widget maker enjoys a boost to sales and reduced losses. Over almost a decade, these sham contracts bring in £831 million in additional revenue.
This, in a nutshell, is the case against Manchester City Football Club, as outlined in the eye-popping conclusions of an independent commission appointed by England’s Premier League and released this week. In this case, the widgets are Manchester City’s performances on the soccer pitch, while the sham payments were disguised as sponsorship and other commercial contracts.
The question now is what punishment the club should face. Unsurprisingly, the debate has focused on possible sporting penalties for flouting English and European rules governing financial fair play. These include fines, the deduction of points, relegation to the lower divisions of English soccer, the cancellation of past trophies, and even a forced sale by Manchester City’s ultimate owner, Sheikh Mansour bin Zayed Al Nahyan.
But the same behaviour merits business sanctions, too. The directors of a humdrum widget maker that engaged in such deception could expect civil or even criminal charges, while the auditors who waved it through would also face censure. Manchester City, one of the most high-profile businesses in Britain, should be held to at least the same standard.
The club says it is innocent and has a “comprehensive body of irrefutable evidence” to support its case, which is ongoing. Apologists might argue that, as the £831 million started and ended with the same owner, the deception was cosmetic. Manchester City’s sporting rivals, who for years were outgunned in the competition for star players, disagree. The private equity firm Silver Lake, which invested $500 million in the club at a $4.8 billion valuation in 2019, may also take a different view. Besides, the unnamed commercial partners presumably engaged in some financial sleight-of-hand to facilitate the money-go-round.
Self-declared realists will maintain that capital-starved Britain cannot afford to alienate deep-pocketed investors like the United Arab Emirates. It’s also true that the Premier League has long tolerated the dubious motives of wealthy owners from the former Soviet Union, the Middle East and elsewhere in its quest for a bigger worldwide audience.
Yet the scale, audacity and duration of the scheme revealed this week demands a tougher response. At stake is not just the sporting fairness of the Premier League. As Liam Proud writes, the scandal is also a test of Britain’s legal, financial and institutional integrity. Much depends on what happens next.
CHART OF THE WEEK
There are many reasons to buy and sell Hong Kong stocks. Now investors have another factor to watch: China’s offshore tax crackdown. The People’s Republic seems determined to bring riches parked in the former British colony into its fiscal net, possibly forcing wealthy shareholders to sell some stock in listed companies. Ka Sing Chan unpicks the connections.
THE WEEK IN PODCASTS
The academic and author Daniel Susskind has spent years studying technology and the future of work. His newest book was inspired by the question he hears most often about artificial intelligence: “What Should My Children Do?”. On The Big View this week we discussed why it is folly to try to predict future jobs, and why teaching basic skills will be crucial.
Over in the Viewsroom, Aimee Donnellan, Neil Unmack and Liam Proud unpacked the standoff between UBS UBSG.S and the Swiss government over capital rules and the bank’s headquarters.
PARTING SHOT
Given the amount of time bank executives spend talking about shifting their head office, the number of times it happens is vanishingly small. HSBC moved from Hong Kong to London in the early 1990s, and decided against returning to the former British colony in 2016. Nordea switched from Sweden to Finland in 2018. Now UBS is the focus of a debate about its location after Switzerland’s parliament voted for tougher capital rules. Liam Proud explains how and why the $160 billion lender could end up moving out of Switzerland.
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(Editing by Liam Proud; Production by Oliver Taslic)
((For previous columns by the author, Reuters customers can click on LARSEN/peter.thal.larsen@thomsonreuters.com))