EFL: Another investigation, another disciplinary hearing

The EFL announced on Monday evening that they have brought charges against Birmingham City Football Club as well as a number of other individuals in relation to breaches of EFL Regulations. The statement goes on to confirm that they had been considering of anybody involved with the “proposed acquisition of control” complied with Regulations in relation to the Owners’ and Directors’ Test (OADT).

EFL

The EFL statement can be seen at this link.

The club have also made a statement at this link acknowledging those charges.

Richardson Statement by insta

Paul Richardson also made “a statement” via Instagram confirming that:

“…we will defend any alleged breaches of the regulation’s [sic] vigorously”

As can be imagined, this news has hit social media like the proverbial sack of shit with many fans unsure as to what means for Blues.

The statements from the EFL and the club are very scant on information and with this in mind I thought it best to write this as a Q&A piece based on what I know and have been told.

What is this investigation regarding?

This investigation involves the failed takeover of the club by Maxco Capital.

The allegations are that during the time of their takeover bid there were people running the club who had not taken the OADT.

While no people have been named in the statement, the fact Paul Richardson has made “a statement” on Instagram would make me think that he, Maxi Lopez and Matt Southall are almost certainly three of the people involved.

There is no indication yet that anyone connected to the club has been charged.

Hang on a minute. Surely everyone knew they were running the club?

It certainly wasn’t any kind of secret that Southall, Lopez and Richardson were involved in the way the club was being run.

In fact, thanks to the photos shared on Instagram by both Lopez and Richardson it would appear that they were openly claiming to be involved.

That can’t have escaped the EFL’s attention either; yet it’s taken them until now to announce the charges.

This makes me think the problem for the EFL is a little bit deeper than blatant self-promotion on social media, as cringey as that was.

As much as I was critical of the Maxco bid, I cannot believe that any of the Maxco people would have been foolish enough to openly be involved with decisions at the club if they weren’t convinced that they were allowed to.

Take into account that £7.5M was sunk into the running of the club during that period by Maxco and it seems unbelievable that Maxco nor the club were doing this in ignorance or defiance of the EFL Regulations.

I’m no lawyer nor accountant but the above says to me that both Maxco and the club must have had some sort of documentation which they believe covered them legally; and that it’s this documentation that might be the issue with the EFL.

I’m going to admit that this is pure speculation, but it’s my opinion that the Blues owners and Maxco must have had some sort of agreement which was the basis of their negotiations for the sale of the club and it’s this agreement that the EFL have taken exception to.

If that is the case, then anyone who signed that agreement could be in trouble,; including whoever signed it for the Vong Pech / BSH side.

Is there any kind of precedent as to what the punishment could be?

While not strictly the same, in October 2022 Rochdale AFC and four individuals were punished by the EFL for breaches of EFL Regulations following the acquisition of shares by Morton House in July 2021.

Unlike the situation at Blues, Morton House were never in control of Rochdale AFC.

However, Morton House and Rochdale were punished for the way Morton House acquired shares in the club in July 2021, breaching regulations surrounding the OADT.

Rochdale were punished with a six point deduction, which is suspended for a period of two years.

In addition, the four people charged were banned from “operating as a Relevant Person” at a football club; three for a period of 24 months and one for 18 months.

What that means in English is that those people can’t do anything that would see them in control of a football club; be it owner, director or any other fancy title which gives them control of the chequebook.

This punishment tallies with a paragraph at the bottom of the recent John Percy story about Blues in The Telegraph. While the story was well shared by fans, I did think at the time many people missed the impart of what Percy was reporting.

Former Barcelona midfielder Maxi Lopez and Paul Richardson, a Birmingham fan, then launched their own takeover bid and even paid a deposit to complete a buy-out. This also fell through in December and that deal is now being investigated by the Football League. There are allegations that daily running of the club was being carried out before a takeover. Sources at Birmingham fear the EFL could sanction the club with a suspended points deduction if found guilty.

The big thing to bear in mind in this is the time it took Rochdale to be punished.

Rochdale were charged by the EFL in March 2022, but the punishment wasn’t confirmed until seven months later in October.

Bearing in mind the legal complexities sure to be involved, I think we can forget any decision being made before September at the earliest. Which means any punishment dished out almost certain will not affect Blues this season.

What about the Wang Yaohui investigation?

The bad news is the investigation into Wang Yaohui aka the elusive Mr King is still ongoing.

In fact, there have been three investigations concurrently being undertaken by the EFL.

It’s my understanding that the third investigation relates to whether BSH and Maxco were in collusion during the takeover period.

I have no idea how the Wang investigation will be affected by all of this.

Like everyone else I’m concerned that there could be a case where we see penalties stacking up against the club due to the concurrent nature of these investigations, but until this happens it’s only a massive feeling of pessimism.

Will this affect the possibility of a takeover by Often Partisan Limited?

I think there has to be some concern that the takeover bid led by Jeremy Dale and Keith Pelley may be affected by this disciplinary hearing.

However, in my mind there is no way that Dale or Pelley could have got so far into the possibility of a takeover without knowing this was a possibility.

I think the main way this will affect that potential takeover is that OPL now have a solid cause to force the owners to accept a clause which reduces the cost of the deal if Blues are relegated due to this or any investigation.

While I’m sceptical that Dale wanted any involvement from any of the Maxco people, I think this disciplinary hanging over the collective heads of Richardson and Lopez will once and for all end any hope they have of even being involved in a deal.


The main thing I want people to take from this is that right now, nothing has happened to the club.

There is no certainty that anyone will be punished in any way, and there is nowhere near enough information to be sure of what will happen.

Most importantly like everything the EFL does, this is going to drag on for months.

It’s almost certainly not going to affect the team this season and as such we shouldn’t fear that.

All we can do right now is hope for the best and Keep Right On.