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The Premier League is currently vulnerable to new investors and team owners who could have sourced their wealth from illicit activities.

That鈥檚 according to a new peer-reviewed paper which is the latest to raise concerns about the competition鈥檚 Owners' and Directors' Test 鈥� colloquially known as the 鈥楩it and Proper鈥� test 鈥� saying 鈥渃omplex and opaque structures permit the misuse of EPL club ownership for the channelling of illicit finances鈥�.

Criminology experts from The University of Manchester, who led the study, say their findings demonstrate 鈥渃onditions which are known to be associated with the use of organisational structures for illicit activities in the ownership structures of many EPL clubs鈥�.

Such conditions include the 鈥渨idespread use of various legal entities and traditional 鈥榮ecrecy鈥� jurisdictions鈥� that can hide who owners and investors are, as well as the presence of unnecessarily complex arrangements, and an absence of information on who all the owners actually are.

They state the current Owners鈥� and Directors鈥� Test does not do enough to prevent potential new owners and investors from withholding the source of their funds, 鈥渨hich could be from illicit activities鈥�.

The test, they state, also does not prevent investors from concealing 鈥渢he nature of particular transactions, which could involve violations鈥�, nor obscuring the 鈥渁ctual investors or owners of clubs, who may be unscrupulous actors looking to conceal their illicit funds or intentions鈥�.

Reporting in the journal , co-author Nicholas Lord, a Professor of Criminology at 91直播鈥檚 School of Social Sciences, says these enabling conditions require further 鈥渟crutiny by responsible regulators鈥�.

鈥淭he obscuring of transparency around the ownership chains and networks presents significant obstacles to regulators seeking to assess the suitability of individuals and owners for football club ownership.

鈥淭he conditions of EPL (English Premier League) ownership structures in itself does not imply anything inappropriate is taking place, but these conditions make it possible for some people, who may be motivated to do so, to use ownership structures to obscure key information.

鈥淭he conditions we found are known to be associated with the use of organisational structures for illicit activities, such as money laundering, and are reflected in the ownership structures of many EPL clubs.鈥�

Co-author Dr Pete Duncan, who recently completed his PhD in the Department of Criminology, adds: 鈥�12 of the 20 clubs have at least 10% of their holdings, which 鈥� due to secrecy provisions 鈥� cannot be formally traced back to their beneficial owners. 

The experts launched their study 鈥渕otivated by recent concerns regarding links between football and illicit finance鈥�.

They searched the academic literature to identify conditions regularly observed in cases of money laundering and illicit financial management. They then collected and analysed data from the ORBIS portal (a database of over 489 million companies from 170 sources) and the 2023/24 EPL Handbook to qualitatively determine whether club ownership structures 鈥渟hared common conditions with structures which enable the management of illicit finance鈥�. The aim was to examine whether conditions that are often present in cases of illicit financial flows could also generate 鈥渢he potential for illicit financial management through EPL clubs鈥�.

They also assessed the ownership structures of each club, noting down the number of corporate or other non-natural person entities in each club ownership chain; the incorporation of holding companies in non-UK jurisdictions; the number and types of different legal entities composing each club鈥檚 organisational structure; and whether over 90% of holdings in each club could be attributed to natural persons. They then extracted the 鈥榮ecrecy score鈥� measure of the 2022 Financial Secrecy Index for each related jurisdiction used from the Tax Justice Network鈥檚 (2022) webpage.

Findings demonstrate that 91直播 United had the greatest number of legal entities in its ownership chain (13), followed by Crystal Palace and 91直播 City (both 11).

Also, the experts found 14 clubs have at least one corporate entity in the structure incorporated overseas (including in Jersey). When considered proportionally, Bournemouth, Wolves and Liverpool are the clubs with the greatest proportions of their ownership structures made up of overseas-based corporate or other legal entities 鈥� where most score relatively highly on the TJN鈥檚 鈥榮ecrecy score鈥� scale.

鈥淲hilst it might be understandable for an overseas beneficial owner to own an EPL club via a holding company incorporated in the overseas jurisdiction they reside in, the combined use of multiple secrecy jurisdictions and opaque entity types that ultimately result in the obscuring of true beneficial ownership is concerning,鈥� adds Dr Duncan, whose PhD examined the nature, organisation, and regulation of variably illicit tax minimisation in UK professional football.

鈥淭he use of these varied ownership mechanisms and structures makes it challenging to differentiate between sources of legal or illegal finances and wealth, whilst the creation of complex arrangements that are inherently legal and commercially plausible offers great scope to co-mingle both legal and illegal activities.

鈥淚t is these structures that should be scrutinised most closely by regulators and other stakeholders.鈥�

Professor Lord concludes: 鈥淲hat is certain is that such complicated ownership structures are not strictly necessary to run a successful EPL club.

鈥淢any structures do not simply extend beyond what is strictly necessary in a single dimension, but in fact combine multiple enabling conditions in the construction of seemingly anomalous structures鈥�.

Whilst such structures and arrangements can be used for good reason in business, what should be a concern for football stakeholders and law enforcement, is that the seemingly unnecessarily complex and opaque structures identified in this research could permit the misuse of EPL club ownership for the channelling of illicit finances.

鈥淎ny exposure to illicit financial flows could seriously jeopardise the futures of clubs, which would have serious negative consequences for those most attached to these very important institutions.

鈥淔urthermore, opaque ownership structures make it difficult for football regulators to ensure that regulations regarding multi-club ownership are being complied with.鈥�

Dr Duncan and Professor Lord recommend that future regulation involves mapping the structures of teams to identify conditions that are susceptible to misuse.

They also suggest further research on the topic, such as to analyse in what ways football club ownership structures have been misused for illicit financial flows, and how these behaviours are organised.

One limitation of their paper is that extracted ownership data originated from varying financial years, meaning some were not 鈥榣ive鈥�.