Why the FA banned George Graham

The Football Association yesterday published detailed findings of this summer's disciplinary commission which found the former Arsenal manager, George Graham, guilty of misconduct and suspended him from all football activity until 30 June 1996. The following are edited extracts from the commission's `Statement of Reasons'.

Uniquely, for a disciplinary hearing, the procedure involved a prosecution case, presented by Brian Leveson QC for the FA, and a defence, conducted by Anthony Arlidge QC for Graham. The charge concerned an alleged breach of Rule 26(a)(x) governing `misconduct... or any improper behaviour likely to bring the game into disrepute'. It related to the transfers of Paal Lydersen from IK Start to Arsenal in November 1991 and John Jensen from Brondby to Arsenal in July 1992. The three members of the commission were: Geoff Thompson (chairman, Sheffield and Hallamshire FA), Gordon McKeag (Football League president) and John Reames (Lincoln City chairman).

The prosecution case

Mr Leveson put the charge, in summary, in three alternative ways:

(1) most seriously, that Mr Graham had effectively conspired (with Mr Rune Hauge, a football agent) to make a personal profit from the Lydersen and Jensen deals;

(2) that the payments arose out of or in connection with the transfers, and he knew that was so when he received them;

(3) that the payments were connected to the transfers but Mr Graham did not realise this.

It was clear from Mr Arlidge's final speech that he broadly accepted that it was helpful to look at the case on these bases.

The chronology of events

The chronology of events was subject to a considerable degree of agreement between the FA and Mr Graham.

(1) Transfer of Paal Lydersen

On 10 September 1991, there was a series of meetings in Oslo in relation to the proposed transfer of Mr Paal Lydersen from IK Start in Norway to Arsenal. The first meeting took place at the SAS Airport Hotel between Messrs Stallemo, Hansen and Gillmuyden, representing IK Start and Mr Hauge.

Mr Hauge left this meeting to pick Mr Graham up from the airport. The parties then reconvened at the Cecil Hotel in central Oslo. There was a brief meeting between Messrs Hauge, Graham and Lydersen. This was followed by a meeting between Messrs Stallemo, Hansen, Gillmuyden, Graham and Hauge during which the transfer terms were negotiated.

An agreement between IK Start and Arsenal dated 6 November 1991 was signed by Messrs Hansen and Friar [Arsenal secretary, Ken Friar] on behalf of their respective clubs. The relevant terms in the agreement are that Arsenal agreed to pay IK Start pounds 500,000, with an additional pounds 50,000 if the player made 50 First Team appearances.

Under an agreement dated 12 November 1991 between IK Start and Interclub Limited (a Guernsey based Company registered in the British Virgin Islands in which Mr Hauge told us he had a third share of the ownership), the club agreed to pay to Interclub pounds 310,000 "out of the transfer fee of pounds 500,000". By a letter dated 5 December 1991, Arsenal instructed Barclays Bank, Finsbury Park branch, to transfer pounds 500,000 to the account of IK Start at Pluss Bank in Kristiansand, Norway. This was received into Pluss Bank on 9 December 1991 and a payment of approximately pounds 308,500 was made out of the account on 13 December 1991 to the Barclays Bank Guernsey account of Interclub Limited.

(2) Transfer of John Jensen's registration

We had considerably less evidence in relation to the transfer of Jensen. An agreement between Brondby and Arsenal dated 14 July 1992, signed on behalf of their respective clubs by Messrs Bjerrghard and Friar, contains the terms of the transfer of Jensen's registration. Arsenal agreed to pay pounds 1.57m. By a letter dated 22 July, Arsenal instructed Barclays Bank, Finsbury Park branch, to transfer pounds 1.57m to the account of Brondby at Inter-Bank in Copenhagen, Denmark.

(3) The payments to Mr Graham

Mr Graham admitted in evidence that a few days before 23 December 1991 he received pounds 140,500 in cash at a meeting with Mr Hauge in the bar of the Park Lane Hotel in London. Mr Graham also admitted to having received in the post at some time shortly before 19 August 1992 a banker's draft in the sum of pounds 285,000 payable in his name under a compliments slip from Mr Hauge.

(4) Disclosure and payment to Arsenal

Mr Graham did not tell anyone connected with Arsenal about the payments until a meeting with Messrs Friar and Hill-Wood [Peter Hill-Wood, Arsenal chairman] on 19 September 1994. Mr Graham transferred to Arsenal on 1 December 1994 the sum of pounds 465,500. This represented the total received by him from Mr Hauge together with interest.

A letter from the Inland Revenue dated 22 April 1994 to Arsenal's accountants raised concerns about evidence that "... coaching staff have received payments or moneys... which have emanated from transfer fees paid by your client". This was discussed at a meeting on 26 April 1994, at which Messrs Friar, Graham and Burtenshaw (Arsenal's chief scout) were present. Mr Burtenshaw admitted at the meeting to having received money from Mr Hauge.

Findings of fact

Matters on which the FA's case rested included inference from findings in relation to proximity in time of the payments and the deals; the nature of the payments; the amounts concerned; the conduct of the negotiations and Mr Graham's dealings with the payments.

We heard evidence from Messrs Stallemo, Hansen, Friar and Hill-Wood for the FA and Messrs Graham and Hauge for Mr Graham. Mr Howard Wilkinson [Leeds manager] also gave character evidence on behalf of Mr Graham.

The Jensen deal, as with the Lydersen deal, was borne originally of the relationship between Mr Burtenshaw and Mr Hauge. Hauge gave evidence that he had secured Jensen as his client and also had an arrangement with Brondby whereby Hauge would keep for his or Interclub's own benefit any transfer fee amounts over 9m Krone (approximately pounds 750,000-pounds 800,000 we were told). Hauge had both the selling club and the player with him. As he told us, this was a very strong position for him to be in.

As with the Jensen deal, Mr Hauge was at the centre of the Lydersen deal and it is important to reflect on what each witness thought Mr Hauge's role was. In relation to the IK Start representatives, we accept the evidence of Mr Stallemo and Mr Hansen that they believed Hauge had been acting in early discussions for Lydersen and Arsenal. Both cited having been shown a letter from Arsenal, a copy of which was not available to us, although Mr Friar recalled in evidence writing a letter of introduction at Mr Burtenshaw's request. IK Start, however, wanted to deal with someone from Arsenal and that is why Mr Graham went to Oslo. Mr Graham gave evidence that in early negotiations with Hauge (i.e. before he went to Oslo), he thought Hauge was acting for both IK Start and Lydersen. Mr Graham gave evidence that he went to Oslo on 10 September 1991 having already agreed with Hauge a payment from Arsenal to IK Start of pounds 500,000 for the transfer.

However when the 10 September meeting commenced, negotiations started in the approximate "bid-offer" range of pounds 160,000-pounds 250,000. Mr Graham, despite having agreed a price of pounds 500,000 with Hauge, supposedly on behalf of IK Start, and for which he had sought prior Arsenal Board authority, negotiated at figures well under half this amount. The eventual figure agreed at the meeting was pounds 215,000. Mr Graham did not tell IK Start about the pounds 500,000. He did not tell them that he had negotiated a figure with Hauge which he told us he thought had been agreed on behalf of IK Start.

Mr Hauge gave evidence that the negotiations were all along in the region of pounds 500,000-pounds 600,000. We reject this in the light of the evidence of the others present at the meeting who gave evidence, including Mr Graham himself.

When asked by Mr Leveson what he thought he was doing when involved in this negotiation, Mr Graham said he was concerned to ensure that Arsenal did not pay more than pounds 500,000, which might occur if the basic figure he was negotiating with IK Start was too high.

In support of the first formulation of the charge, Mr Leveson invited us to infer from these circumstances that there was a more "sinister" explanation than the one given by Mr Graham, namely that Mr Graham was effectively negotiating not only for Hauge's cut but that he was also doing this pursuant to an arrangement whereby he himself would get a proportion. In this connection, Mr Leveson relied upon Mr Hansen's evidence of a telephone call from Hauge, in which Hauge (not Mr Graham) sought to explain that the amount on the transfer agreement dated 6 November 1991 would be pounds 500,000, and not pounds 215,000. Mr Hansen gave evidence that Mr Hauge had said this was for work permit reasons. Mr Leveson's case was that IK Start had to be given an explanation as to why the figure of pounds 500,000 would appear and that we could infer a conspiracy between Mr Hauge and Mr Graham that Mr Hauge should make the call.

Mr Leveson also referred to the figures. The payment to Interclub from IK Start was pounds 310,000. We were told that from that a pounds 25,000 payment to Lydersen had to be deducted, leaving pounds 285,000. In rough terms and bearing in mind bank charges, pounds 140,500 is about half. We should note that, apart from the sum of pounds 25,000 already referred to, Mr Hauge gave evidence that some further payment was made to Lydersen (according to Mr Hauge, pounds 100,000) out of the pounds 310,000. Mr Graham received pounds 285,000 within five weeks of the Jensen deal. Mr Leveson submitted that after taking into consideration what Jensen was said by Mr Hauge to have received (some pounds 200,000), this was about half the difference.

We find that at the 10 September meeting Hauge and Mr Graham failed to present a genuine picture to the IK Start representatives. However, we cannot make the leap... that Mr Leveson invited us to make, in order to find the first formulation proven. There are sufficient other factors to weaken any necessary inference that Mr Graham was doing this for his own benefit.

In relation to Lydersen, as Mr Hauge said, he controlled the player. He was the central figure and if his cut was inadequate he could kill the deal. We accept the evidence that, as with the majority of deals in continental Europe, Mr Hauge had to have his cut out of the transfer fee. A difference of pounds 285,000 was felt by Hauge to be sufficient. But whether Hauge would be content with substantially less, especially if some payment perhaps of pounds 100,000, would have to be made to Lydersen, is less clear. Mr Graham and Mr Hauge both gave evidence that Mr Graham had to ensure that Mr Hauge was happy with his cut. The way they went about this seems bizarre, but Mr Graham might have felt that he needed to maximise Hauge's share.

Mr Graham's behaviour in the Lydersen deal was difficult to understand, and the lack of disclosure either to IK Start or to Arsenal of the true position does him no credit. But this is not to say he must have dealt for his own benefit. We have to accept Mr Arlidge's submissions that... we cannot be sure that Mr Graham's role in each deal was predetermined to line his own pocket. As we cannot be sure of the inference in relation to the Lydersen deal, we must also reject it in relation to the Jensen deal, when Mr Graham's involvement was less direct.

There was a close proximity between the payments and the deals. In relation to Lydersen, the negotiations took place on 10 September 1991. Mr Graham signed the player's contract on 8 November. He received pounds 140,500 about six weeks later. The payment to Mr Graham was made less than three weeks after Arsenal had paid IK Start and less than two weeks after the receipt by Interclub of its share. In relation to Jensen, the transfer and player's contract were signed on 14 July 1992 (the latter was signed by Mr Graham) and within five weeks Mr Graham had received a banker's draft for pounds 285,000. We were not given evidence as to when Brondby paid money over to Interclub but do know that Arsenal paid out on 22 July.

A football agent making such large payments in cash, or in the case of the banker's draft "near-cash" to the manager of a buying club so close to the conclusion of the deal and the payment of the transfer fee, is in our view an extraordinary set of circumstances. When he met Mr Hauge in the bar at the Park Lane Hotel in December 1991, Mr Graham (on his own evidence) was handed pounds 140,500 in pounds 50 note bundles, which he placed in a briefcase. He had signed the player's contract just six weeks before. Again, within weeks after the Jensen deal, he received what must have struck him as a very large sum of money. Mr Graham gave evidence about the payments being unsolicited. However, even if this is right, as a respected manager of a Premier League team and a senior figure in the League Managers' Association, we find that he must have known just how serious a matter it was for him to be receiving this amount of money from an agent. When it happened for a second time after the Jensen deal, this must have struck him even more forcefully.

Mr Graham agreed in his evidence that it would be wrong to accept money from an agent directly connected with any Arsenal transfer. Both Mr Graham and Mr Hauge told us that the payments were made by Interclub as a gift for Mr Graham helping Mr Hauge to gain recognition as an agent on the European stage. Mr Graham told us that he thought it was "because of the contacts I made him." "(Hauge) said his business was doing very well and this was his way of showing his gratitude." He also told us that he did not declare the payments to Arsenal because he did not consider them to be connected to transfers. We do not accept this. We should state that this judgment is based on the evidence which we heard. We have placed no reliance on Mr Graham's allegedly inconsistent answers to the FAPL [Football Association Premier League] inquiry.

Mr Graham's evidence that he made only brief enquiries as to the reason for the payment and as to his satisfaction with the explanations given to him by Mr Hauge is, we find, wholly unconvincing. When he received the bundles of cash in the Park Lane Hotel, he must have reflected on the fact that he had only recently succeeded in negotiating a cut for Mr Hauge in relation to the Lydersen deal. Similar thoughts must have occurred to him when he received another payment so soon after the Jensen deal.

Mr Hauge's explanation for the payments is impossible to accept. Before the Lydersen deal, and certainly before the Jensen deal, Mr Hauge was, by his own admission, a very successful football agent with a very healthy bank account.

We have no doubt therefore that when Mr Graham received each of the two payments he knew the reason for the receipt, namely that they arose directly out of or in connection with the two transfers. We are sure of this in relation to the Lydersen deal. It is equally compelling in relation to the second payment. We are therefore satisfied that the second of Mr Leveson's formulations is proved. We are sure from the inferences we draw that Mr Graham must have known when he received them that these were payments arising out of or in connection with the transfers. This is, in our view, undoubtedly improper behaviour or conduct likely to bring the game into disrepute.

We totally reject any connection, as Mr Arlidge sought to draw, between the payments and the Limpar deal. We further find no merit in this regard in Mr Arlidge's submissions that Mr Graham's involvement in the Jensen deal was minimal and that what involvement he did have was to refuse to pay pounds 2.2m and agree only pounds 1.57m. We do not find it weakens the clear inference of Mr Graham's knowledge.

Also, we do not find any strength at all in the argument that the inference of the connection is weakened by the relationship between Messrs Graham and Hauge or the fact that Mr Graham did not strike any further deals with Hauge. The evidence in relation to the latter does no more than show that no suitable deal presented itself, at least so far as Mr Graham was concerned.

Sport
sportGareth Bale, Carl Froch and Kelly Gallagher also in the mix for award
News
Japan's Suntory Beverage & Food has bought GlaxoSmithKline's Lucozade and Ribena
news
News
A tongue-eating louse (not the one Mr Poli found)
newsParasitic louse appeared inside unfilleted sea bass
Life and Style
Out and about: for 'Glee' character Bert Hummel, having a gay son was a learning curve
lifeEven 'cool' parents need help parenting gay teens
PROMOTED VIDEO
Have you tried new the Independent Digital Edition apps?
Money
Anyone over the age of 40 seeking a loan with a standard term of 25 years will be borrowing beyond a normal retirement age of 65, and is liable to find their options restricted
propertyAnd it's even worse if you're 40
Arts and Entertainment
Perhaps longest awaited is the adaptation of Jack Kerouac’s On the Road with Brazil’s Walter Salles directing and Sam Riley, Kristen Stewart and Viggo Mortensen as the Beat-era outsiders
books
Arts and Entertainment
theatreSinger to join cast of his Broadway show after The Last Ship flounders at the box office
Life and Style
fashion'To start singing with Pharrell is not that bad, no?'
News
news
Caption competition
Caption competition
Latest stories from i100
Daily Quiz
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

Career Services
iJobs Job Widget
iJobs General

Austen Lloyd: Employment Solicitor

£30000 - £60000 per annum + Excellent: Austen Lloyd: Employment Solicitor - Ke...

Argyll Scott International: Risk Assurance Manager

Negotiable: Argyll Scott International: Hi All, I'm currently recruiting for t...

Austen Lloyd: Clinical Negligence Solicitor

Highly Competitive Salary: Austen Lloyd: HAMPSHIRE MARKET TOWN - A highly attr...

Ashdown Group: IT Systems Analyst / Application Support Engineer (ERP / SSRS)

£23000 - £30000 per annum + pension, 25days holiday: Ashdown Group: An industr...

Day In a Page

In a world of Saudi bullying, right-wing Israeli ministers and the twilight of Obama, Iran is looking like a possible policeman of the Gulf

Iran is shifting from pariah to possible future policeman of the Gulf

Robert Fisk on our crisis with Iran
The young are the new poor: A third of young people pushed into poverty

The young are the new poor

Sharp increase in the number of under-25s living in poverty
Greens on the march: ‘We could be on the edge of something very big’

Greens on the march

‘We could be on the edge of something very big’
Revealed: the case against Bill Cosby - through the stories of his accusers

Revealed: the case against Bill Cosby

Through the stories of his accusers
Why are words like 'mongol' and 'mongoloid' still bandied about as insults?

The Meaning of Mongol

Why are the words 'mongol' and 'mongoloid' still bandied about as insults?
Mau Mau uprising: Kenyans still waiting for justice join class action over Britain's role in the emergency

Kenyans still waiting for justice over Mau Mau uprising

Thousands join class action over Britain's role in the emergency
Isis in Iraq: The trauma of the last six months has overwhelmed the remaining Christians in the country

The last Christians in Iraq

After 2,000 years, a community will try anything – including pretending to convert to Islam – to avoid losing everything, says Patrick Cockburn
Black Friday: Helpful discounts for Christmas shoppers, or cynical marketing by desperate retailers?

Helpful discounts for Christmas shoppers, or cynical marketing by desperate retailers?

Britain braced for Black Friday
Bill Cosby's persona goes from America's dad to date-rape drugs

From America's dad to date-rape drugs

Stories of Bill Cosby's alleged sexual assaults may have circulated widely in Hollywood, but they came as a shock to fans, says Rupert Cornwell
Clare Balding: 'Women's sport is kicking off at last'

Clare Balding: 'Women's sport is kicking off at last'

As fans flock to see England women's Wembley debut against Germany, the TV presenter on an exciting 'sea change'
Oh come, all ye multi-faithful: The Christmas jumper is in fashion, but should you wear your religion on your sleeve?

Oh come, all ye multi-faithful

The Christmas jumper is in fashion, but should you wear your religion on your sleeve?
Dr Charles Heatley: The GP off to do battle in the war against Ebola

The GP off to do battle in the war against Ebola

Dr Charles Heatley on joining the NHS volunteers' team bound for Sierra Leone
Flogging vlogging: First video bloggers conquered YouTube. Now they want us to buy their books

Flogging vlogging

First video bloggers conquered YouTube. Now they want us to buy their books
Saturday Night Live vs The Daily Show: US channels wage comedy star wars

Saturday Night Live vs The Daily Show

US channels wage comedy star wars
When is a wine made in Piedmont not a Piemonte wine? When EU rules make Italian vineyards invisible

When is a wine made in Piedmont not a Piemonte wine?

When EU rules make Italian vineyards invisible