Always a Wasp

Author Topic: Sarries and the Cap  (Read 12340 times)

Vespula Vulgaris

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Sarries and the Cap
« on: March 03, 2019, 11:25:44 PM »
It seems to be starting to come out how they are enticing players without "breaking" the cap.

I wonder if Daly is on his way to being a company director now...

https://www.dailymail.co.uk/sport/rugbyunion/article-6766973/Have-Saracens-broken-salary-cap-rules-Owner-Nigel-Wray-business-four-England-stars.html
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RBB

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Re: Sarries and the Cap
« Reply #1 on: March 04, 2019, 07:10:50 AM »
There is so much to unravel and then prove that I suspect a compromise will be arrived at, as per the previous investigation. 
It was fine when I left it.....

Tervueren

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Re: Sarries and the Cap
« Reply #2 on: March 04, 2019, 07:46:55 AM »
Playing devil's advocate,  is it really bent?Or, does it just sound so?

All the paper had to do was look for directorships for Sarries rugby players, hardly up there with deep throat and Watergate. This is either clever,  hiding in plain site, if challenged then the defence that it is so apparent as not to be dodgy.  Or, it is just not dodgy.

If Wray has guaranteed loans to a business, not given loans to a player (something the cap rules cover), then there might be nothing technically that is a breach unless the guarantee is called upon.  If Fazola pizza Co. makes money and the bank loan is repaid, is there a cap breach?

Not trying to defend the evil empire, just don't want to get too excited yet.

P.s. Happy to be shot down in flames and proven wrong.

Vespula Vulgaris

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Re: Sarries and the Cap
« Reply #3 on: March 04, 2019, 07:56:02 AM »
How about if two very rich people set up a company, buy 1.5M of property, and then one of them resigns and two rugby players are appointed as directors with equal shares. Does their share of assets fall under the cap? How about any profit made from the sale of those assets? How about if those assets appreciate in value?
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Tervueren

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Re: Sarries and the Cap
« Reply #4 on: March 04, 2019, 08:01:45 AM »
Clearly a breach if a material gain that can be traced back to the club or its officers. However one of the businesses had a 1.5 million bank loan that obfuscates things rather.
I just hope Wray has not outwitted or outgunned rugby again.

Neils

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Re: Sarries and the Cap
« Reply #5 on: March 04, 2019, 08:19:40 AM »
Clearly a breach if a material gain that can be traced back to the club or its officers. However one of the businesses had a 1.5 million bank loan that obfuscates things rather.
I just hope Wray has not outwitted or outgunned rugby again.

Of course he has. Spirit of broken cap but legally probably nothing can be done. Just plain bent.

Tervueren

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Re: Sarries and the Cap
« Reply #6 on: March 04, 2019, 08:32:21 AM »
Perhaps a salary cap work only when set so high that no one can afford to break it.

BG

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Re: Sarries and the Cap
« Reply #7 on: March 04, 2019, 08:45:16 AM »
Clearly a breach if a material gain that can be traced back to the club or its officers. However one of the businesses had a 1.5 million bank loan that obfuscates things rather.
I just hope Wray has not outwitted or outgunned rugby again.

A player having a LTD company (Daly has had one - Briefcase13 long before he joined Sarries) is not breaking the salary cap and Wray being a director along with a player also does not break any salary cap rules. It doesn't break any tax rules either as long as the correct tax is being paid  on the income that the LTD company generates.

It does though create a way of topping up a player's yearly income that is completely isolated from Saracens. What could easily occur is that Wray (personally... not Sarries) invests in setting up a business, a player does nothing but is added as a director, income into that Ltd company comes from valid customers or from one of Wray's many other businesses (again not Sarries). Then the player sits back and sees the dividends roll in. I wouldn't be at all surprised if wives or girlfriends weren't either directors or at the very least employees of that LTD company being paid up to the tax threshold limit as well which is what any director does of a small Ltd company. as long as income coming into that LTD company doesn't come from Sarries directly it doesn't break the salary cap rule which is very clever. This is where having a rich owner has its secondary benefit.. that owner can personally (or from one of his other business) pay into that LTD company and there's nothing PRL can do to investigate it.

I've been implying this loopole for ages on the other forum when Brad Barrett, before a game about 18 months ago, was promoting his own coffee outlet at the Sarries ground.

I wouldn't be at all surprised if that business, stock, rent, rates has all been bankrolled by Wray personally or one of his companies and then Brad sits back and sees the dividends roll in.

In fact... there may be more into the coffee shop business model. Other players I recall I seem to have a coffee shop (I remember some Bath players having shares in one - Daly possibly being another). The one benefit of using a coffee shop as a "front" is that almost all of the income will be cash over the counter and its very difficult to tie accurately sales income to stock purchased.

The plot thickens

mike909

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Re: Sarries and the Cap
« Reply #8 on: March 04, 2019, 08:50:42 AM »
Quote
The one benefit of using a coffee shop as a "front" is that almost all of the income will be cash over the counter and its very difficult to tie accurately sales income to stock purchased.

To a point, it ought be auditable or else you end up getting the tax people interested, which is not a good thing. Cash income ought to be rung through a till or else its just wads of cash floating about and no way of doing stock ordering. But - that does rely on such a venture being a real business.

wasps

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Re: Sarries and the Cap
« Reply #9 on: March 04, 2019, 09:44:08 AM »

The "spirit" of the cap is obviously so that a club can't sign players by offering them more financial reward than they're allowed to spend.
In terms of the "spirit", this would seem to be against the cap.

In terms of the "law" of the cap, this is probably fine.

At the end of the day, it's now a professional, cut throat sport/business so this kind of thing doesn't surprise me.
Ultimately, if you were a player and your future life / financial earnings were at stake, what would you do?

Vespula Vulgaris

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Re: Sarries and the Cap
« Reply #10 on: March 04, 2019, 09:47:19 AM »
At the end of the day, it's now a professional, cut throat sport/business so this kind of thing doesn't surprise me.
Ultimately, if you were a player and your future life / financial earnings were at stake, what would you do?

I'd refuse to have anything to do with it. 

Some people are so poor that all they have is money.
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bournender2

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Re: Sarries and the Cap
« Reply #11 on: March 04, 2019, 09:49:37 AM »
Buy a run down property, and a few months later its value could easily be doubled - that's if is just renovated/refurbished for own residence purposes. How about re development needing a big loan; and the company then benefits from commercial rents and then post retirement it could be liquidated with profits going to ? (and taxman)

Rossm

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wasps

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Re: Sarries and the Cap
« Reply #13 on: March 04, 2019, 01:48:06 PM »
At the end of the day, it's now a professional, cut throat sport/business so this kind of thing doesn't surprise me.
Ultimately, if you were a player and your future life / financial earnings were at stake, what would you do?

I'd refuse to have anything to do with it. 

Some people are so poor that all they have is money.


It depends how it's dressed up though.
If it's made to sound shady, then I'm sure players would reject it.

However, if it's sold as a separate business helping them for their post rugby career blah blah blah, and they're agent says that there's no problem with it, I suspect most people wouldn't think too long about it.



BG

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Re: Sarries and the Cap
« Reply #14 on: March 04, 2019, 01:59:29 PM »
RugbyPass

https://www.rugbypass.com/news/saracens-are-spending-pound2m-over-the-salary-cap-and-its-legal

That's not quite the same as what's appeared in the DM. Everyone knew that Sarries probably received the most cap rebates due to all their internationals and academy players but I'm surprised it's worth £2m to them. I think their international rebate should be worth £320k (max £85k per player.. depending on amount of games played for Eng) .. let's guess their marquee player value rebate is worth £1.2m.. where's the rest come from?