by Tom Bower
To restore morale among the FA’s staff and the county representatives and rebuild the FA’s purpose and power, Palios spoke genuinely about his appreciation of ‘all the good things done by the FA’. He won grudging respect, especially from the Premier League, for launching a strategic review of the FA. He won plaudits from the traditionalists for restoring funds to purchase blazers for council members at Aquascutum. Preferring to work beyond the spotlight, he prided himself on delegation, processes and subtle management as approved in business schools. If Palios had been better educated, not least in crisis management, he would have foreseen the pitfalls when the News of the World exposed on 18 July 2004 a secret relationship between Eriksson and Faria Alam, an attractive 38-year-old secretary employed by the FA.
At a meeting the following morning, Palios impassively mentioned the topic preoccupying those gathered in the boardroom. ‘Sven/Faria,’ he stated, was to be handled by the FA’s lawyers. ‘If Faria asks for help,’ continued Palios, ‘the FA as a “caring employer” should offer its assistance, just like we would [with] Beckham or anyone else.’ Faria had already denied the relationship and was expected to sign a denunciation of the newspaper’s allegations as drafted by the FA’s lawyers. No one questioned Palios’s strategy. Instead of publicly dismissing an affair between two unmarried employees as irrelevant, Palios allowed their private lives to become a test of the FA’s probity. He went even further. On the grounds that their relationship might be ‘a breach of their contracts with the FA’, or might ‘damage the FA’, he initiated an inquiry into Sven’s private life without revealing a potentially sensational addition – his own previous relationship with Faria Alam. Although Palios could argue that as an unmarried man, his relationship with the secretary was a personal matter, he did not understand that the consequence of insincerity was a delayed suicide bomb. His subsequent excuse was weak. After three marriages, he explained, he was due the following day to meet the mother of his last child in an attempt at reconciliation. A confession, he would explain, risked ruining that opportunity. By operating in the shadows, he ignored the conclusion which outsiders would draw of his own and the FA’s dissembling.
‘Ask Sven for his reaction,’ Palios asked David Davies. To avoid embarrassment, Palios resisted speaking directly to Sven. Davies reported after questioning Sven his impression that the newspaper’s allegations were untrue. Considering Sven’s secret negotiations with Manchester United and Chelsea, and his clandestine affair with the TV presenter Ulrika Jonsson, it was unwise of the FA to place so much confidence in Eriksson’s candour and loyalty. Hindsight would also confirm Palios’s misfortune that his fate was entrusted to Geoff Thompson, who epitomised the FA’s dysfunctional nature. Having no reason to doubt Davies’s assurance, Thompson issued a statement denying the truth of an affair between Sven and Faria.
Within the FA’s headquarters, most FA employees knew that the denials were untrue. Many had heard Faria Alam boast about her sexual antics and describe her past relationship with Palios. They assumed that his furtiveness would simultaneously emerge with the revelation about her affair with Sven. All agreed that Sven had not been completely truthful and that Faria’s denial to the FA of a relationship was at variance with what she had told her colleagues. The FA was blighted by three employees and their chairman’s inertia. What followed compounded the existing damage to the FA’s credibility.
The publication in the News of the World on 25 July describing Alam’s consecutive relationships with Palios and Eriksson rocked the Association. The injury was compounded by the public account of inept negotiations by an FA official with the newspaper to limit the exposure only to Eriksson. Football is accustomed to public humiliation but the blowback on this case was exceptional, especially among the Premier League clubs. Richard Scudamore had never wholly respected Palios and doubted his original mantra of creating ‘a wall of credibility’. Denied any support, Palios was compelled to resign – the third chief executive to depart in four years in embarrassing circumstances. Alam was also dismissed. Eriksson refused to resign. He revealed his expectation of at least £10 million in compensation if he was dismissed.
Palios’s departure, eased by £600,000 compensation, unleashed fury against the FA by the executives of the Premier League clubs. The relationships between consenting adults was an excuse to attack the FA’s confused structure and its unimpressive employees as the cause of incompetence, friction and lack of constructive leadership. The list of specific grievances focused on a central theme. Did the sensation expose the FA’s employees as flawed individuals, or was the FA itself flawed? The Premier League believed the latter.
In Scudamore’s opinion, the FA and Premier League were in an ‘almost constant state of collision and disagreement. Trust is lacking.’ There could, he insisted, not be a single individual in overall command of football, nor could the FA interfere in the daily management of the Premier League. He blamed the ‘conflict and alienation’ on an ‘unsustainable current way of working’ especially about financial issues including intellectual property rights, corporate governance and TV rights. Scudamore’s championship of the Premier League’s separate existence was aggressive. ‘The beautiful game,’ he insisted, was no longer ‘a working man’s sport’ but part of the entertainment business. The owners – mavericks, tycoons and foreign investors – were entitled to reject any investigation of their financial history by the regulator. The FA’s authority to impose a ‘fit and proper test’ over his congregation was ridiculed. Football’s ethics, Scudamore preached, would be resolved exclusively by the Premier League.
Scudamore’s disparagement of the FA provoked raw responses from his targets. ‘Big egos and megalomaniacs’ was one senior FA councillor’s description of the Premier League management. David Richards, the League’s abrasive chairman, ‘was meant to chair one meeting in 1999 and stayed for ever. Now he wants a knighthood,’ a malevolent FA counciller joked. The FA’s traditionalists agreed with Scudamore about the ‘conflict’ but in their opinion there were potential conflicts of interests among the Premier League’s leaders, not least for Dave Richards, a former scrap-metal dealer, who was simultaneously chairman of the Football Foundation, a member of the FA’s management board and the chairman of the Premier League. Scudamore, they felt, wanted alternatively ‘a stranglehold over the FA’ or ‘to grab a bigger slice of the cake from the FA’. The enduring image was a contest between solid, well-meaning English stock versus determined money-grabbers. The FA’s traditionalists suspected the combination of Richard Caborn, Geoff Thompson and Dave Richards, alias ‘the Sheffield mafia’, but failed to agree about the root of their suspicion. Either the three were distrusted because they mutually supported each other, or because they reciprocated mutual loathing.
The misunderstanding was profound. Scudamore’s ambition was not to dominate the FA but to be liberated from amateur preoccupations. He opposed the FA wielding any authority over the Premier League beyond the nominal approval every year of its rule book. Fearing the disagreements would cause paralysis or worse, Richard Caborn, the sports minister, persuaded the FA to commission an independent review of its organisation. His initiative was greeted with mixed feelings.
The review was entrusted to Lord Burns, the former permanent secretary at the Treasury, chairman of Abbey National and a former director of Queen’s Park Rangers. Burns was asked to report by the end of July 2005. His proposals, he decided, would rebuild the FA with sufficient authority to manage a regulatory system and enforce the rules. Those involved in the FA and Premier League would be encouraged to offer solutions to the byzantine, unaccountable organisation composed of twenty standing committees, fourteen sub-committees, and two parallel management boards plus ninety-one members of the Council.
Officially, all sides hoped that Burns could terminate the civil war. Unofficially, neither side offered a genuine compromise between the Premier League’s demand for radical change and the traditionalists’ defence of the status quo. In his meetin
gs with Burns, Scudamore was scathing about the ‘Blazer Brigade’s’ travel to London on first-class tickets, to stay in luxury hotels and consume expensive meals just to spend one hour at a meeting where ‘they don’t understand a thing’. His complaint was succinct: ‘The volume and level of debate at FA meetings does not appear to justify the time or the cost.’ Ray Kiddell, a vice-chairman representing the national game, attracted his criticism. Despite Kiddell’s good intentions and knowledge of the industry, his frequent attendance at FA conferences around the country with Roger Burden, representing the counties, and travel to support women’s and indoor football was highlighted by Scudamore as characteristic of waste and the ‘cosy comfort zone’. In reply, Kiddell observed, ‘The Premier League bosses think football ends at the twentieth position in their League. They forget all the important work the FA undertakes among the 37,500 affiliated clubs.’
The tension influenced the process to replace Palios. The FA’s supporters wanted a new chief executive as soon as possible. Unconcerned by the FA’s plight, Scudamore sought to prevent a selection until Burns had reported. David Dein overrode the obstacle. He secured the appointment of Brian Barwick, a former ITV controller of sports, despite his apparent lack of commercial experience. Dein’s insistence on such an appointment alienated Scudamore, further undermining Dein’s status in the football fraternity. The beneficiary was Scudamore, promoting the Premier League’s influence just as the clubs’ finances began again to deteriorate.
The executive’s bluff manner gave the impression of a technocrat preoccupied by money and unconcerned with the soul of the sport. The news on 26 May 2005 that the shareholders of Manchester United would accept a £790 million bid from the Glazers, an American family, did not trouble Scudamore. Understanding that the paucity of profits had encouraged the sale of football’s goliath, he was untroubled by that defining transaction. Sanguinely, he acknowledged the self-inflicted impotence of both the FA and Premier League to interfere with the purchase of a publicly quoted company, not least by investigating whether the Glazers were ‘fit and proper’ as owners. Reflecting the interests of his members, he welcomed foreign take-overs. By then, Abramovich had reputedly spent £427 million on Chelsea. In those circumstances, argued Scudamore, English football could be said to be fortunate that foreigners had come to the rescue. The combined investment by Sky – owned by an American – and the two major clubs owned by foreigners, he argued, had reinvigorated English football. He wilfully dismissed those voicing fears about the ultimate fate of the national game under the control of off-shore, foreign billionaires.
Richard Scudamore’s welcome to Abramovich and the Glazers encouraged Pini Zahavi to seek more foreign buyers, especially Israelis. In autumn 2005, he heard that Milan Mandaric was anxious to sell Portsmouth. Zahavi introduced Alexandre Gaydamak, an Israeli who claimed to be involved in finance and real-estate projects in Russia, as the purchaser of a 50 per cent interest for £30 million. Gaydamak had not previously shown any obvious interest in football but was known to have managed companies which were either indebted or in administration. It was unlikely the FA would be unable to discover the source of Gaydamak’s millions or where the club’s ultimate ownership would be registered. So long as Gaydamak remained as an investor and not a director, the FA had no power to investigate whether Gaydamak was ‘fit and proper’. Compounding the disarray was the suspicion that Alexandre Gaydamak’s money had been lent by his father, Arcadi Gaydamak, the owner of a Jerusalem football club. Arcadi Gaydamak was the subject of an international warrant for an oil-for-arms deal in Angola in 1994, although he strenuously denied any wrongdoing. The FA presented itself as powerless to interfere. Initially, Gaydamak paid £20 million for his stake, and would pay a further £32 million on 19 July 2006 for the remaining shares.
The prospect of more American and Russian billionaires buying Premier League clubs alarmed English critics, who accused Zahavi of exercising a damaging influence on English football. The Israeli, representing other potential clients, approached Premier League shareholders looking for a purchase. Daniel Levy of Spurs mentioned a price of £200 million, while Danny Fiszman, Arsenal’s major shareholder, would speak of £400 million plus £300 million of debt once the new Emirates stadium was completed. Beyond Zahavi’s influence, potential foreign buyers were approaching the major shareholders of Aston Villa, Newcastle, Everton, Liverpool, Manchester City and Blackburn Rovers. All were enticed by the promise of fame and the guarantee of £35 million per season from the latest Sky television deal worth, with additional deals, about £1.7 billion (£1.2 billion from Sky) for three years from 2007, 65 per cent more than its predecessor, or six times more than Sky’s original bid in 1992. Their interest was not discouraged by Scudamore. In his opinion, the broadcasting income would continue to rise so long as the millions flowed to buy the world’s best players.
The fate of English football was disconnected. While the Premier League expanded its global audience to nearly two hundred countries, the FA’s traditionalists still struggled to tolerate the Premier League’s existence. In their opinion, English football would suffer if the Premier League lost its relationship with the grass roots – not only because supporters would lose their relationship with the owners but foreigners would have no interest in cultivating young English schoolboys to become future stars or keep entrance fees low for the poorer fans. Reconciling the extremes depended on Terry Burns negotiating a solution with a realistic chance of acceptance.
His proposals, presented on 12 August 2005, were intended to improve the decision-making and ‘clarity of responsibility’ within the FA. To neutralise the Premier League’s veto and improve the FA’s control over the Premier League, he proposed substantial reforms including the appointment of an independent chairman. Superficially, the scheme would satisfy the FA but since reform depended upon the Premier League’s approval, and Scudamore would not approve any changes which either diminished the Premier League’s autonomy or failed to increase his influence over the FA, Burns was under no illusion of success. Negotiations depended upon Caborn persuading and threatening the FA’s traditionalists with financial penalties if they refused to co-operate.
The FA’s leaders were impeded by their own lacklustre performance. The completion of Wembley had been again delayed and England’s reliance upon Sven-Goran Eriksson in the World Cup compounded the doubts about the value of the revised new contract. His mercenary, cold relationship with FA officials and club managers prompted critics to wonder, ‘I no longer know what he brings to the party.’ His private life and values were also questioned. ‘He’s a bad role model who leaves a lot to be desired,’ the traditionalists agreed. To those critics, he was a shallow enigma, basking in vanity. The majority nevertheless hoped that he would cherish the best potential players English clubs had offered for some years to win the 2006 World Cup in Germany.
The curse was the lack of loyalty among those, motivated by their search for fame and fortune, who felt disdain towards the FA and its rules. Noting the rewards that Eriksson had extracted from the FA for his disloyalty, there was an element of recklessness in the arrangement of a meeting in April 2004 between Rio Ferdinand and Peter Kenyon of Chelsea. The suspected ‘tapping’ of Ferdinand from Manchester United passed off without reprimand. The second encounter on 27 January 2005 between Ashley Cole, his agent Jonathan Barnett and Jose Mourinho in the Royal Park hotel in Lancaster Gate aroused the fury of David Dein. Arsenal’s executive was livid that Cole had ridiculed an offer of £55,000 per week as ‘taking the piss’ and wanted vengeance against Chelsea. The common element in both suspected ‘tappings’ to induce a breach of contract, Dein knew, was the presence of Pini Zahavi. Successfully, he persuaded Scudamore that the Premier League should ‘prosecute’ and discipline Mourinho, Cole and Barnett. The punishment was severe. Cole was fined £100,000 and Mourinho was fined £200,000. Both fines were later reduced to £75,000. Chelsea was fined and received a suspended three-point deduction. Barnett was fined £100,0
00 and given an eighteen-month ban to act as an agent, half of this period being suspended. Barnett’s punishment was the first time an agent’s licence was suspended for touting. He would nevertheless eventually receive £1.5 million for Cole’s transfer to Chelsea. Only Zahavi, not registered by the FA, escaped any sanction.
By then, the sense of sleaze within football had been spread by an exposure of Eriksson on 15 January 2006 arranged by the News of the World. Succumbing to the temptations of a ‘fake sheikh’, Eriksson had flown to a yacht moored in Dubai and admitted while drinking expensive wine that three Premier League managers were receiving bribes and that he might be tempted to abandon England if offered another manager’s job. Eriksson’s morality heaped ridicule upon the FA. The Association’s plight was compounded by Mike Newell’s outburst in the same month. ‘Football,’ said Newell, ‘is full of people taking back-handers. Why is nothing ever done?’ In Newell’s experience, agents offered him back-handers from the transfer fees of players. Among the worst, in Newell’s opinion, were the multi-millionaire agents. If the truth about football’s sleaze emerged, he threatened, ‘people in high places’ would have ‘major worries’.
The combination of Newell’s and Eriksson’s allegations could no longer be ignored. Nearly four years earlier, at the meeting at West Ham to inaugurate the Independent Football Commission, Scudamore had insisted, ‘There’s no corruption in football.’ Until then, his members, pursuing their own self-interested agenda, had felt immune to any reprimand. Despite their alleged powers, the FA’s executives were exclusively beholden to the clubs’ owners, not least to provide the best players for the international competitions. To some, bungs were accepted costs of the business. Scudamore’s adamant denial was no longer sustainable. Responding to the screaming headlines, the pressure came from Richard Caborn, the minister of sport, to ‘clean up football’. Previously, the minister had called for ‘all the evidence’ to be examined, but on this occasion he urged Scudamore to launch a proper investigation.
