Sheffield Wednesday: Row intensifies over 'ground sale method’ used to combat EFL financial rules

The row over how clubs have dealt with EFL financial regulations which could soon involve Sheffield Wednesday has been stoked further after Derby County owner Mel Morris labelled Middlesbrough counterpart Steve Gibson ‘hypocritical.’

Monday, 27th May 2019, 5:27 pm
Updated Monday, 27th May 2019, 8:07 pm
Hillsborough

Gibson has pledged to take legal action against Derby after claiming they have breached EFL profit and sustainability rules.

The source of Gibson’s ire is the fact Morris sold Derby’s Pride Park stadium for £80m to a separate company also owned by the businessman and then leased it back. The move helped Morris post a profit of £14.6m on Derby’s accounts for the 2017/18.

It has been reported that Wednesday chairman Dejphon Chansiri has carried out a similar deal, selling Hillsborough, to help the Owls ease through a pivotal summer in their own dealings with profit and sustainability regulations.

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Derby County owner Mel Morris

Wednesday have yet to post their accounts for the 2017/18 financial year.

Clubs are prohibited from losing more than £39m over a three-year period. In their last two published annual accounts, Wednesday have posted losses of £9.8m and £20.8m, with the club placed under a ‘soft’ transfer embargo by the EFL last April.

The method of stadium sale to combat financial rules has drawn the anger of Middlesbrough owner Gibson, who has turned his focus onto Derby in particular.

It has been suggested he will sue the Rams over their alleged financial breaches.

Derby say they have done nothing wrong and offered to allow Boro to go through their accounts – an invitation which was declined.

And owner Morris claims Middlesbrough have carried out similar methods themselves in the past, leading to his accusation of hypocrisy as well as foul play, given the timing with Derby preparing for Monday’s play-off final.

"I’ll call it out there because I think it needs calling out,” Morris said.

"Sale of fixed assets is allowed in the rules.

"In 2016 a club [Middlesbrough) got promoted who chose to sell the tax loss from the football club to the parent company, because that then makes it revenue which is a positive towards profit to help remain within Financial Fair Play.

"When I raised that at a meeting (in March) where all the Championship clubs met to debate this, the representative from the club said it was allowed in the rules at that time.

"So is this! What is different? You set the mould and we copied your lead, now you’re bitching. He [Gibson] had the hypocrisy to do that.

"Even his own fans called it out on their forums and said ‘how dare we do this with our own history’.

"We discussed this issue again and there wasn’t a single vote for the motions being put forward on this thing, not one, including the club that raised the issue. They didn’t even vote for their own motion.

"It needs calling out because unfortunately I didn't write the rules. It is absolutely hypocritical.

"I consider the timing of their action to be cynical, an open attempt to try and steal our focus ahead of a crucial game. Fortunately, we are motivated by such actions.

"I find this to be entirely out of character for Boro, and their chairman."

The EFL has said it will review its financial rules this summer after complaints from owners that some clubs are exploiting the system.

Aston Villa were also reported to be considering the sale of Villa Park if they failed to win promotion to the Premier League.