Field Theory by Hadyn Green

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Field Theory: The Old Marquee Scam

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  • Tom Semmens,

    There seems to me to be a very good chance the club itself will fold. And I see their lead conspirator in the fraudulent behaviour is now head of the Melbourne Rebels Super 15 expansion team, surely he cannot carry on in that role.

    Auckland • Since Nov 2006 • 1825 posts Report Reply

  • LegBreak,

    The fire sale wil be at the end of the season, and other clubs will be offloading their breaches then too.

    They've been allowed to honour this year's contracts.

    The Police angle is interesting; can't really see what general law they've broken

    Wellington • Since Nov 2006 • 1162 posts Report Reply

  • Graeme Edgeler,

    The Police angle is interesting; can't really see what general law they've broken...

    Well, I don't don't about specific Victorian criminal laws, but false accounting would seem to fit if it was in New Zealand:

    Every one is liable to imprisonment for a term not exceeding 10 years who, with intent to obtain by deception any ... benefit, ... or to deceive ... any other person,—

    (a) makes or causes to be made, or concurs in the making of, any false entry in any book or account or other document required or used for accounting purposes.

    Wellington, New Zealand • Since Nov 2006 • 3012 posts Report Reply

  • Daniel Wilton,

    Suddenly the market will be flooded with talented players and a few teams who may have cap room and a few injuries (coughWarriorscough) could get a 1-year contract bargain.

    I am not sure the warriors would want them, they would be like that kid who is forced to go to your primary school because his parents split, sulks a lot and trys to play people vying for their affection off against each other.

    Why aren't the players being punished at all, i.e. Billy Slater may be a good player but he took the money, and inglis and smith. why aren't they stood down from international duty. they took dirty money

    Wellington • Since Jan 2009 • 45 posts Report Reply

  • Naly D,

    The fire sale wil be at the end of the season, and other clubs will be offloading their breaches then too.

    Just look at what happened to the Bulldogs, and considering the Rebels had allegedly already been chasing Slater, Inglis and Smith [you'd be dumb not to] and there's no cap in the Super 14...

    Wellington • Since Sep 2008 • 307 posts Report Reply

  • Kyle Matthews,

    And I see their lead conspirator in the fraudulent behaviour is now head of the Melbourne Rebels Super 15 expansion team, surely he cannot carry on in that role.

    He's been suspended and they're making a public announcement this afternoon. Expect him not to be seeing out his contract.

    Why aren't the players being punished at all, i.e. Billy Slater may be a good player but he took the money, and inglis and smith. why aren't they stood down from international duty. they took dirty money

    I think the further investigations will look into whether any of them were complicit. The story I read (letters stored at the CEO's house promising other money on top of the the official contracts that were submitted to the NRL), certainly indicates that they should have been suspicious at least.

    Since Nov 2006 • 6227 posts Report Reply

  • Kyle Matthews,

    The fire sale wil be at the end of the season, and other clubs will be offloading their breaches then too.

    They've been allowed to honour this year's contracts.

    This makes sense, as long as it's found that the players haven't done any wrong. Melbourne has the money, so it's not a financial issue (except their fans and sponsors will be spewing, so long term financially it will be an issue). And they're not allowed to accumulate any more points this season, so the fact that they're overspending the cap doesn't create a problem. They're going to come last no matter how much money they spend.

    I presume it was done because of equity to the competition. Melbourne have already played some teams with their illegal cap. If they had to cast aside two or three star players now, then teams that have already played Melbourne are disadvantaged relative to teams who have yet to play them.

    There's no true halfway in the competition. While you play each team twice (at home and away), both games might happen in the second half or first half, so there's no future point where they could say 'fit under the cap from this date on by selling players'.

    The other argument to that is that their season has no meaning at all from now on. So the players are unlikely to be giving 100% to win all their games, so teams that play them from now on may be advantaged over teams that haven't played them yet.

    I'm surprised that they didn't strip them out of this year's competition entirely. All games involving them are zeroed out and removed from the record, all future games are now byes for the other team, no points. That would seem the only fair way to do it.

    Since Nov 2006 • 6227 posts Report Reply

  • LegBreak,

    I'm surprised that they didn't strip them out of this year's competition entirely.

    That would’ve been fairer in some ways.

    But it would’ve detracted from State of Origin, and they wouldn’t want that.

    Wellington • Since Nov 2006 • 1162 posts Report Reply

  • John Fouhy,

    I think the further investigations will look into whether any of them were complicit. The story I read (letters stored at the CEO's house promising other money on top of the the official contracts that were submitted to the NRL), certainly indicates that they should have been suspicious at least.

    I think it would be easy for the players to think they're above board. The management could have told them something like "Yeah, our accountants came up with some tricks to let us pay you more while staying technically within the rules".

    If I were in their position, I'd probably believe them. Big companies are widely reputed to engage in all kinds of accounting tricks to bend or avoid the rules, so if I've got accountants and lawyers on my side, why shouldn't I benefit from the same kind of thing?

    Wellington • Since Nov 2006 • 87 posts Report Reply

  • Mike Graham,

    I'm surprised that they didn't strip them out of this year's competition entirely...

    Tend to agree, but if the players didn't know what was going on (a big assumption I know), then it keeps them playing for the rest of the season, and therefore more marketable at the end of the season.

    Re the players involvement - they would obviously know what they were being paid, but not necessarily what the other players were being paid. It's conceivable they didn't do the math to figure that the club was possibily over the cap. If they did think that the club was over the cap, what would they do?

    Auckland • Since Nov 2006 • 202 posts Report Reply

  • Kyle Matthews,

    Tend to agree, but if the players didn't know what was going on (a big assumption I know), then it keeps them playing for the rest of the season, and therefore more marketable at the end of the season.

    It would be complex, but if the players are found to not be at fault, Melbourne could be allowed to lease them out for the remainder of the season. Or the NRL could be allowed to keep the money from the auction if they don't want the Storm to have it. They could even raise the salary cap for the other teams temporarily to ensure that the bidding has meaning.

    Since Nov 2006 • 6227 posts Report Reply

  • Ian Dalziel,

    The Imperfect Storm...
    all those league star-sized hailstones
    will wreak havoc on the glasshouses

    the League of Extra-rort Gentlemen
    scratch a wintergreened underbelly

    Christchurch • Since Dec 2006 • 5169 posts Report Reply

  • Bevan Shortridge,

    The "marquee scam" was intelligent in that the payments were small but were paid every home game. Moreover this is a simple fraud where money just "disappears". So the only people who need to be involved are the players, management and a bunch of accountants

    So this is a new meaning for the term marquee player...?

    Auckland • Since Nov 2006 • 117 posts Report Reply

  • Bruce Wurr,

    The salary cap is a great idea......and there has definitely been a clear breech here. It's certainly one of the closest competitions in the world because of it.

    But playing devil's advocate here - there is a wider concern with the control of news ltd and it's involvement with the nrl in general. The salary cap could actually be construed as a restraint of trade agreement - they're preventing players from making money outside of playing a game of rugby league - e.g. sponsorship, endorsements etc.

    Not too many professional competitions have these restraints, and there is the ever present threat of rugby (in my personal opinion a more boring game by far) to lure players away.

    I believe (could be wrong) the clubs are limited to income from News Ltd etc who feeds it through the NRL. Perhaps the salary cap could be lifted to 6 million or slightly higher and a greater share of tv revenue distributed amongst the clubs?

    It's a fantastic competition in a sport where, particularly in nz it's constantly shooting itself in the foot.

    London • Since Dec 2006 • 89 posts Report Reply

  • Hadyn Green,

    they're preventing players from making money outside of playing a game of rugby league - e.g. sponsorship, endorsements etc.

    I don't think that's true. For example Sonny Bill Williams used to have a deal with Nike.

    Wellington • Since Nov 2006 • 2081 posts Report Reply

  • Bruce Wurr,

    serves me right for not doing research I guess! I would like to see the salary cap lifted a bit higher though to prevent the loss of players to other sports, without bankrupting the clubs either.

    I just hate it that a sport I love constantly goes through turmoil. Like cricket, the other sport I happen to love.....

    London • Since Dec 2006 • 89 posts Report Reply

  • Scott A,

    I'm betting the Storm didn't run those payments through it's normal salary books and tax wouldn't have been withheld from it as it was paid to the players.

    The ATO loves getting high-profile people on the ropes; I hope the players getting the marquee money are getting in touch with their accountants for the oncoming audit 'storm'.

    The wilds of Kingston, We… • Since May 2009 • 121 posts Report Reply

  • Yamis,

    Crowd attendances had bottomed out in 2004 at under 9,000 per game.

    Warriors average crowd in 2004 was 10,171. 2006 was when the arse fell out and it was 8,829 (was 16,842 in 2003 when they were going well). Interestingly last year when they were pretty awful throughout they averaged 15,486.

    There was no way they could make the Storm sit the season out. In effect that would mean the club collapses.

    Players have contracts, sponsors have deals (the ones they still keep), fans still have tickets, some will want their money back but some won't, stadiums need operating costs paid, oppositions sides need matchday income, TV networks have deals etc.

    Since Nov 2006 • 881 posts Report Reply

  • Yamis,

    On what laws may have been broken I'm not sure, it could be to do with misappropriated funds which was meant for one thing and used for another. Not sure though.

    Regarding the players knowing I find it a bit hard to believe that the top ones didn't know.

    Surely the club has to submit a list of all it's contracted players and what they are earning. The NRL then adds this up to see what it equals (and obviously that was 4.1 million or less).

    The NRL then goes to each player individually and asks them what they are earning and cross checks it to make sure that's what they were told.

    If it all adds up to 4.1 mill or less then some player or players are liars.

    Since Nov 2006 • 881 posts Report Reply

  • Richard Llewellyn,

    I'd be very surprised if other clubs are not finding creative ways around the salary cap (much in the same way All Blacks in the Haden-era used to find ways around the shamateurism constraints), but I guess the sheer scale of this one is the shock.

    While the idea of ensuring an even playing field is a good one, the salary cap has plenty of flaws, not least the effective penalising of teams for developing their own talent - my understanding is that the cap accommodates market-value of a player, so if a team signs an unknown 15 year old (e.g. Israel Folou), develops them over 6-7 years into a test player, then they have to accomodate their market value under the cap (or lose them to another club). Surely clubs should get consideration under the cap for home-grown players?

    Mt Albert • Since Nov 2006 • 399 posts Report Reply

  • Kyle Matthews,

    my understanding is that the cap accommodates market-value of a player

    Have you got a reference for that? It would be very strange for a salary cap to not be determined by the actual amount of money paid over the year to all the players.

    There are creative ways to fudge your salary cap. In the NHL players tend to have their contracts backloaded, particularly as they near the end of their career. You sign someone on for $10 million over 5 years, but the first three years are worth 1.5 million each, the last two years 2.75 million each.

    After three years you trade the player (because all their salaries are going up and if you were to pay them all you'd break the cap), and the purchasing team gives you something crappy from their end because they're taking on your backloaded contract.

    You do about 10 contacts like that and you've saved enough money to bring in a couple of marquee players and make a run for a championship. You lift the cup, it's worth umpteen million in sponsors and prize money and ticket sales, hence profit for the owners, then you bite it for the later two years and say you're rebuilding.

    Since Nov 2006 • 6227 posts Report Reply

  • Richard Llewellyn,

    Have you got a reference for that? It would be very strange for a salary cap to not be determined by the actual amount of money paid over the year to all the players.

    Yeah, sorry, thats what I meant - meaning that the market determines the actual salary of the player.

    I don't know exactly how the salary cap works, but I recall clubs with a strong youth policy and a big catchment (particularly the Broncos) feeling quite vehemently that the salary cap system did not incentivise or allow for clubs who were better at successfully developing their own players.

    I quite like the draft system in the NBA, where the bottom clubs from the previous year get first dibs in the draft.

    Mt Albert • Since Nov 2006 • 399 posts Report Reply

  • Blake Monkley,

    By allowing them to play on this year still 700k over the cap isn't the NRL endorsing other teams losing against a team that still has an advantage?

    Auckland • Since Jul 2008 • 215 posts Report Reply

  • LegBreak,

    I reckon there should be a cap on transfers, not wages.

    That would stop the situation you get in football where the likes of Chelsea and Man City go out and buy ready-made teams, taking the competitiveness out of the league.

    But these marquee players at the Storm were developed by the club. Billy Slater was working on the trains in Randwick; the Storm took a punt, and through their development programme turned him into what he is now.

    Seems wrong that the rules punish them for that.

    Wellington • Since Nov 2006 • 1162 posts Report Reply

  • Hadyn Green,

    Seems wrong that the rules punish them for that.

    He's the one playing for the massive salary. Why not take a pay cut for a few years to help that team the "made him" and then go for the big contract after that.

    And fuck the "I developed thisplayer so I should have him" idea. It's a gamble right now, but one htat must be working because the teams are still paying to do it. Otherwise there would a smart team out there not developing players and investing that money into recruiting good ones.

    Wellington • Since Nov 2006 • 2081 posts Report Reply

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