Chelsea’s Large Financial Cushion Raises Risk of Sporting Penalty

Chelsea set aside a large sum to cover possible sanctions tied to past transfer deals, and a finance expert says that could mean the club faces not just fines but also sporting punishments.

The club was charged in September with 74 breaches of FA rules linked to agents and third-party ownership in old transfers. The probes focus on payments connected to deals for Eden Hazard, Willian and Samuel Eto’o during Roman Abramovich’s time as owner. BlueCo, the current owner group, reported those issues to the FA after completing their £2.5 billion takeover in May 2022.

When BlueCo bought the club, it set aside a “holdback amount” from the purchase price to meet any penalties from the Abramovich era. Fordstam Limited, which handled the sale after U.K. sanctions on Abramovich, said this week that the “holdback amount” was £150 million and would be held until 2027. But Fordstam’s accounts also said the money had been written off because of “doubts about its recoverability.”

That move and the large size of the reserve have drawn attention. “There’s a question mark there as to why the size of the provision is so big,” football finance expert and lawyer Stefan Borson told The Guardian. He warned the fund might be meant for more than a fine. “The holdback amount will not just indemnify any financial penalty from a fine. It may also cover claims for consequential losses from any sporting sanctions, such as a loss of a European place or [Premier League] merit payments.”

After the FA charged the club, many assumed Chelsea would face only a financial penalty because the club had self-reported. Now, concern is growing that sporting punishments, including a points deduction or a transfer ban could be possible. Such outcomes would carry extra costs beyond any fine, which may explain the large provision the new owners set aside.