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Danny Graham: Watford in the dock | The Sun |Sport|Football
SWANSEA cup hero Danny Graham’s £3.5million move from Watford is at the centre of a sensational disciplinary case.
Striker Graham and the Swans are not under suspicion but Championship promotion-chasers Watford and former owner Laurence Bassini are both in hot water with the Football League.
Watford have been charged with breaking third-party investment rules in relation to the 2011 Graham deal and with breaching another financial regulation.
If found guilty, the Hornets could face a points deduction.
But the Football League has also taken the rare step of bringing a personal misconduct charge against Bassini — even though he sold Watford to the Pozzo family last June.
The League claim former bankrupt Bassini was instrumental in the alleged rule-breaking and want him banned from becoming a director at any other club.
The case, which is set to be heard later this month, will reveal extraordinary information — including how Swansea were threatened with legal action by a company which had lent Watford money.
Hotshot Graham, who moved to the Swans in June 2011, scored the second goal in the Capital One Cup semi-final first-leg win at Chelsea.
The Welsh club were to pay £2m up front, plus three further instalments of £500,000. These were to be paid to the Premier League, then forwarded to the Football League and, finally, Watford.
The first Swansea knew of any problem was last summer when they were threatened with legal action by a company called LNOC Limited, who said they were owed £1m.
And when the Leagues investigated, they uncovered a tangled web.
In cases when a buying club signs a deal involving instalments, it issues promissory notes — effectively watertight pledges to pay what is due.
According to documents seen by SunSport, Watford sold on Swansea’s promissory notes to LNOC, accepting up-front money in return for agreeing to hand over the two lots of £500,000 when Swansea paid them.
But Rule 44.2 requires clubs to submit such deals to the Football League Board for approval. The League say Watford failed to do so and broke Rule 48.1 on third-party investment by taking money from LNOC.
Worse still, the Football League claim Watford denied the existence of any third-party deal when asked by officials.
So the League paid the two £500,000 instalments to Watford, not to LNOC. The Football League then discovered that another deal had been done with LNOC.
In September 2011, LNOC handed over £1,660,595, in return for Watford agreeing to forfeit £1.8m of future central Football League funding.
Rule 19 says clubs must tell the League within 24 hours if they have ‘assigned’ future central income.
In addition, clubs who are allowed to do such deals are placed under a transfer embargo until the debt is repaid and must ask permission to buy or loan in players.
Again, the Football League say Watford did not ask permission. LNOC received one instalment of £900,000 from Watford in February 2012 but are taking legal action to recover the second, which was due last September.
Watford’s new owners have reached an understanding with the League on the issue but, in theory, the club should have been placed under a transfer embargo from September 2011 until full repayment. In that time they have signed Nyron Nosworthy, Manuel Almunia and Fitz Hall.
Now the Football League may come under pressure from other Championship clubs to deduct points from Watford. League chiefs describe the charges against Watford as “serious”.
But the fact they have taken the unusual step of charging Bassini (left) as an individual with misconduct may be significant. In a letter, the League’s lawyers, Burges Salmon, told Bassini: “The FL considers your conduct in this matter to be of an exceptionally serious nature.”
The letter adds that the League want a finding of misconduct against Bassini and “an order that you are disqualified from holding office as a Director of a Club for such a period the commission determines”.
It is believed Watford will claim other club officials were not aware of either LNOC deal. At the time of the deals, Bassini was the only director of Watford FC Ltd, the club’s ultimate parent company.
Bassini, Watford and the League declined to comment. A Swans spokesperson said: “We’ve had dealings with Watford’s new owners and found them friendly and well run.”
SWANSEA cup hero Danny Graham’s £3.5million move from Watford is at the centre of a sensational disciplinary case.
Striker Graham and the Swans are not under suspicion but Championship promotion-chasers Watford and former owner Laurence Bassini are both in hot water with the Football League.
Watford have been charged with breaking third-party investment rules in relation to the 2011 Graham deal and with breaching another financial regulation.
If found guilty, the Hornets could face a points deduction.
But the Football League has also taken the rare step of bringing a personal misconduct charge against Bassini — even though he sold Watford to the Pozzo family last June.
The League claim former bankrupt Bassini was instrumental in the alleged rule-breaking and want him banned from becoming a director at any other club.
The case, which is set to be heard later this month, will reveal extraordinary information — including how Swansea were threatened with legal action by a company which had lent Watford money.
Hotshot Graham, who moved to the Swans in June 2011, scored the second goal in the Capital One Cup semi-final first-leg win at Chelsea.
The Welsh club were to pay £2m up front, plus three further instalments of £500,000. These were to be paid to the Premier League, then forwarded to the Football League and, finally, Watford.
The first Swansea knew of any problem was last summer when they were threatened with legal action by a company called LNOC Limited, who said they were owed £1m.
And when the Leagues investigated, they uncovered a tangled web.
In cases when a buying club signs a deal involving instalments, it issues promissory notes — effectively watertight pledges to pay what is due.
According to documents seen by SunSport, Watford sold on Swansea’s promissory notes to LNOC, accepting up-front money in return for agreeing to hand over the two lots of £500,000 when Swansea paid them.
But Rule 44.2 requires clubs to submit such deals to the Football League Board for approval. The League say Watford failed to do so and broke Rule 48.1 on third-party investment by taking money from LNOC.
Worse still, the Football League claim Watford denied the existence of any third-party deal when asked by officials.
So the League paid the two £500,000 instalments to Watford, not to LNOC. The Football League then discovered that another deal had been done with LNOC.
In September 2011, LNOC handed over £1,660,595, in return for Watford agreeing to forfeit £1.8m of future central Football League funding.
Rule 19 says clubs must tell the League within 24 hours if they have ‘assigned’ future central income.
In addition, clubs who are allowed to do such deals are placed under a transfer embargo until the debt is repaid and must ask permission to buy or loan in players.
Again, the Football League say Watford did not ask permission. LNOC received one instalment of £900,000 from Watford in February 2012 but are taking legal action to recover the second, which was due last September.
Watford’s new owners have reached an understanding with the League on the issue but, in theory, the club should have been placed under a transfer embargo from September 2011 until full repayment. In that time they have signed Nyron Nosworthy, Manuel Almunia and Fitz Hall.
Now the Football League may come under pressure from other Championship clubs to deduct points from Watford. League chiefs describe the charges against Watford as “serious”.
But the fact they have taken the unusual step of charging Bassini (left) as an individual with misconduct may be significant. In a letter, the League’s lawyers, Burges Salmon, told Bassini: “The FL considers your conduct in this matter to be of an exceptionally serious nature.”
The letter adds that the League want a finding of misconduct against Bassini and “an order that you are disqualified from holding office as a Director of a Club for such a period the commission determines”.
It is believed Watford will claim other club officials were not aware of either LNOC deal. At the time of the deals, Bassini was the only director of Watford FC Ltd, the club’s ultimate parent company.
Bassini, Watford and the League declined to comment. A Swans spokesperson said: “We’ve had dealings with Watford’s new owners and found them friendly and well run.”
