Manchester City are being formally investigated by UEFA for breaches of Financial Fair Play regulations.
They could face a Champions League ban next season if leaked documents published by German magazine Der Spiegel prove financial cheating.
Among the many allegations is that the club used cash from owner Sheik Mansour to finance sponsorship deals and circumvent FFP rules.
A statement by UEFA last night said:
‘The investigation will focus on several alleged violations of FFP that were recently made public in various media outlets.’
UEFA president Aleksander Ceferin described the evidence he had seen as a ‘concrete case’, while insiders at European football’s governing body suggested any sanction would go beyond City’s £49m fine — £32m of which was suspended — in 2014 for breaching FFP regulations.
City are preparing a robust legal defence that will go beyond simply complaining that the evidence being used against them has been stolen.
They will also argue that much of it has been taken out of context.
A statement from the club last night read:
‘Manchester City welcomes the opening of a formal UEFA investigation as an opportunity to bring to an end the speculation resulting from the illegal hacking and out of context publication of City emails.
The accusations of financial irregularities are entirely false.’
The FA is examining allegations that City paid Jadon Sancho’s agent £200,000 when the England winger was just 14, which would be a breach of regulations.