Birmingham City have been docked nine points over breaches of the English Football League’s profitability and sustainability rules, the English Football League has confirmed.
The Championship club entered a hearing earlier this week with the EFL believed to be pushing for a 12-point deduction.
However, as first revealed by Jim White on talkSPORT, the Blues have instead been docked nine points due to their excessive spending over the past few years.
It is further understood Birmingham have avoided any transfer restrictions as well as a potential fine.
The club have 14 days to appeal the decision, through the Championship table has been amended with immediate effect.
An EFL statement read: “An independent Disciplinary Commission, appointed under EFL Regulations, has today ruled that Birmingham City will be deducted nine points as a result of a breach of the League’s Profitability and Sustainability Rules (Rules).
“It follows a review of the financial submission from Birmingham City for the three-year period 2015/16 to 2017/18 where it was determined the Club had recorded losses in excess of the £39.0m upper loss threshold.
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“On 14 August 2018 the Club was charged with a breach of those Rules. At a hearing on 18 March 2019, the Club pleaded guilty to the charge, and after hearing representations from both parties, the panel has fully considered the matter and ruled a nine-point deduction is appropriate, which will take effect in the current season.”
The St Andrew’s outfit published their annual accounts in January, with their excessive overspending clearly detailed.
Huge wage increases during Gianfranco Zola and Harry Redknapp’s managerial tenures saw Birmingham spending a remarkable £202 for every £100 they brought in.
The Championship club also recorded a loss of £37.5million in the 12 month period ending June 2018.
“The Profitability and Sustainability Rules, aligned with those in the Premier League, became effective in 2015/16,” said an EFL spokesperson. “Season 2017/18 was the end of the first full reporting period with Birmingham City the only Club found to have breached those requirements, when it incurred adjusted losses of £48.787 million, £9.787 million in excess of the permitted losses.
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“The Disciplinary Commission had the opportunity to consider all relevant factors in reaching its determination, including the Club’s mitigation.”
Birmingham also ignored a transfer embargo last summer to sign Kristian Pedersen, the full-back.
The EFL initially refused to register Pedersen, but after reviewing such a move from a legal standpoint, the 24-year-old was finally awarded clearance to play two days before the start of the season.
The league’s governing body expressed their disappointment at Blues ignoring the embargo to sign Pedersen, who has gone on to represent the club 30 times this season.
A nine-point deduction leaves Birmingham just five points above the Championship’s bottom three, throwing the club into a relegation battle.
Before being docked points, Blues were sitting comfortably mid-table under Garry Monk, with 14 points separating them from the final relegation place. They were also only seven points off the play-off positions, though Birmingham’s recent woeful form ended talk of a promotion push; Blues have lost each of their previous four matches.
The points deduction leaves Birmingham down in 18th, just five points ahead of Rotherham in 22nd.
They face a tough run of fixtures over the next few weeks with promotion contenders West Brom, Leeds and Sheffield United all coming up in their next three matches.
Blues then also take on fellow relegation rivals Ipswich, Rotherham and Wigan before facing Reading on the final day of the season.