The Biggest Salary Cap Penalties in Australian Sport

With the penalties handed down to Parramatta in the National Rugby League yesterday, Ive laid out a ranking of the top penalties for salary cap breaches in Australian sport.

1.  The Melbourne Storm (NRL 2010)

Unquestionably the king of salary cap penalties, the Melbourne Storm were heavily penalised after the National Rugby League uncovered breaches estimated to be in excess of $1.7million over five years, around $400,000 in 2009 and with a projected breach of $700,000 in 2010. The League also found that the Storm had kept a dual contract system, as well as secret side letters detailing extra payments that were apparently found in the safe of the clubs chief executive.

The Club was stripped of its 2008 and 2009 premierships (these were not awarded to the opposition clubs either), prevented from earning any competition points in 2010, forced to repay 1.1 million in prize money and fined another $500,000.

2. Parramatta Eels (NRL 2016)

In March 2016, it was revealed that the Eels had openly been discussing ways to avoid to subvert the salary cap at board level, prompting a full investigation by the National Rugby League, which later found the club had engaged in systematic cheating of the cap by offering additional payments totaling hundreds of thousands of dollars to players and securing secret third party payments.

The Club was penalised the maximum fine of $1,000,000 (the NRL had earlier offered to suspend $250,000 of the fine, but that changed when it was revealed that planning to undermine the cap had continued up until February this year), stripped of 12 competition points, stripped of its Auckland Nines win at the start of the year, and five officials were deregistered by the league. In addition, the clubs favourable points for and against differential was removed.

3. The Carlton Blues (AFL 2002)

Having had relatively minor breaches of the salary cap in 1994, 1999 and 2001 resulting in varying penalties ranging from $40,000 to $120,000 (and exclusion from the 2000 preseason draft), it was something of a surprise to no one when the Blues were caught red handed in 2002 having paid at least 4 players (Craig Bradley, Stephen O’Reilly, Stephen Silvagni and Fraser Brown), and up to 7 players under the table in previous years.

The AFL commission fined the Carlton football Club $930,000 including $872,424 for current breaches and a further $57,526 remaining from suspended sentences from breaches in 1999. In addition, the club was denied its first two selections in the 2002 National draft, as well as their second and third draft picks – their first pick would be at 45. Further the Blues were penalised the first and second round picks in the 2003 draft, and the 2002 Preseason draft

4. Canterbury Bulldogs (NRL 2002)

The Bulldogs were stripped of points and fined after the National Rugby League found them guilty of systematic breaches of the salary cap totally more than $1 million of the 2001-2002 period.

In response, the league hit back hard, fining the club $500,000 and stripping them of the 37 competition points they’d earned in 2002, relegating them to the bottom of the league ladder with 3 rounds to go, effectively ending the clubs season.

5. The Melbourne Demons (AFL 1999)

In 1999, Melbourne President Joseph Gutnick volunteered information to the Australian Football league that showed salary cap breaches totalling $810,000 between 1995 and 1998.

The League proceeded to fine the club $600,000 (of which $250,000 was suspended), and the club lost its 1st, 2nd and 3rd round picks at the national draft for two years.

6. The Adelaide Crows (AFL 2012)

Allegations surfaced in 2012 that Kurt Tippett and the Adelaide Football Club had a secret arrangement that may have involved an extra $200,000 payment and the promise to trade him wherever he wanted to go.

An AFL investigation allegedly found draft tampering, salary cap breaches and implicated the club, senior officials and Kurt Tippet, as well as club sponsor, Balfours.

Adelaide was fined $300,000 and prohibited from the first two rounds of  the 2013 draft – something they offered voluntarily early on –  and from gaining father-son picks at that draft, however the club could trade back in to the early rounds. Steven Trigg was fined $50,000 and given 12 months suspension, John Reid was given a similar 12 months suspension, and Phil Harper was suspended for 2 months. Kurt Tippertt recieved an 11 match suspension and was not permitted to play in the preseason.

7. The Essendon Bombers (AFL 1996)

In 1996, a joint investigation between the Australian Football League and the Australian Tax Office into Essendons finances found that the club had breached the salary cap by more than $514,000 between 1991 and 1996. The investigation started when the AFL was notified of the existence of a document showing that Mark Harvey had received more than $30,000 in incentives outside of his official contract in 1997.

The Bombers were fined $388,000 for both salary cap breaches and draft tampering and hit with a further $250,000 in back taxes by the ATO. The AFL also stripped Essendon of their first two picks in the 1999 national draft and froze them out of the pre-season and rookie drafts entirely.

 

 

 

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