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EFL reportedly seeking possible points deduction against Leeds United rival after legal loophole escape

Leicester City could be hit with a points deduction of up to seven points by the EFL if they are relegated from the Premier League.

According to a new report in The Guardian, the English Football League are determined to see last season’s Championship winners charged in relation to alleged Profitability and Sustainability (PSR) breaches during the three-year accounting period ending June 30, 2023.

Earlier this month, Leicester escaped punishment from the Premier League after successfully arguing they were no longer within the league’s jurisdiction at the time of submitting their 2022/23 accounts, as the team had already been relegated and taken up EFL membership.

Per The Guardian’s report, the EFL have received assurances they have grounds to charge the Foxes for the financial breach of £24.4 million, despite the club not competing in the EFL during the relevant accounting period.

“The club had been charged with a £24.4m breach of the £105m PSR loss limit by the Premier League, which based on the punishments given to Everton and Nottingham Forest last season would have resulted in a deduction of up to seven points if found guilty,” the report states.

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“The EFL is determined to ensure the regulations are enforced and is understood to have received guidance that Leicester would fall under its jurisdiction if relegated. The club officially joined the Championship on 13 June 2023 before filing their accounts two and a half weeks later.”

Leicester lifted the Championship title ahead of Ipswich Town and third-place Leeds United last season, winning promotion back to the Premier League at the first time of asking, at the expense of Daniel Farke’s Whites.

Some Leeds supporters deemed Leicester’s financial activity to have given the East Midlands club an unfair advantage, allowing them to compete at a higher level and retain star players, unlike what has happened at Elland Road this summer where the likes of Crysencio Summerville, Archie Gray and Georginio Rutter were sold to comply with PSR.

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There is no statute of limitations for the EFL to abide by when bringing charges for historical PSR breaches, meaning if Leicester are to find themselves back in the Championship in 2025/26, they are likely to be sanctioned.

If the club are found to have breached PSR for a separate, secondary accounting period, such as between 2021 and 2024, they would likely incur another penalty.

The club recorded a combined pre-tax loss of £182.5 million for the seasons ending 2021/22 and 2022/23 whilst still in receipt of Premier League income. Leicester’s maximum loss threshold for the 2021-2024 accounting period will be approximately £83 million.

“The EFL is determined to ensure the regulations are enforced and is understood to have received guidance that Leicester would fall under its jurisdiction if relegated. The club officially joined the Championship on 13 June 2023 before filing their accounts two and a half weeks later.”

 

 

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