When it comes to the integrity of the game, the Football Association (FA) takes a strong stand – especially on anything that deals with insider trading, betting or wagering. Despite this strong stand, the FA itself seems to take contradicting actions regarding sponsorship of gambling companies. In 2017, the FA ended all of its sponsorships with betting companies, but it has been criticized for having deals with gambling companies where the FA allows those companies to stream football matches if viewers have an account and place a bet with that company. Nonetheless, when it comes to players, staff, managers or referees the rules are clear: no gambling is allowed.
Rule E8(1) of the FA Rules states:
The rule is quite broad and creates a complete ban on betting in FA football. The FA justifies the rule by saying its wants to keep the game special – preserve what is great in the beautiful game. They state the betting rules protect the integrity and the future of the game and that being involved in football is a privilege. The players, managers, staff, and referees should not take advantage of that privilege and create conflicts of interest (i.e. place wagers) or abuse their positions. These justifications are in line with justifications that may be given by other sporting companies such as the NFL.
In July of 2019, Daniel Sturridge was charged with 11 counts of violating E8(1). However, after deliberation, the Regulatory Commission found Sturridge guilty of only 2 charges, while dismissing the rest. The charges dismissed were alleged breaches of the inside information Rule E8(1)(b). The counts proven by the FA dealt with E8(1)(a), where Daniel instructed his brother Leon to place a bet that he, Daniel, would be moving to Sevilla. This was a clear violation of E8(1)(a). As a result, the Regulatory Commission handed down a 6 week suspension (4 of which were suspended) from participation in any domestic football matches (including friendlies) and a £75,000 fine. The FA was NOT happy with the result and appealed to the independent Appeal Board.
On February 27, the Appeal Board handed down its decision. The
“Appeal Board found that the Regulatory Commission misapplied The FA’s Rules in relation to the use of inside information and made findings of fact which could not be sustained. As a result, the Appeal Board has found proven two further charges which were originally dismissed.”
As a result of reinstating and convicting Daniel of two of the charges previously dismissed, the Appeal Board believed that the punishment given by the Regulatory Commission was too lenient. Accordingly, the Board increased the effectively 2 week ban to 4 months and doubled the fine to £150,000. According to FIFA, the ban will enforced by them as well, thus banning Sturridge not only from domestic football, but football world wide.
However, what makes this case interesting are some of the facts and interpretation of whether the facts constitute inside information.
Daniel’s entire family is supportive of his career and he constantly talks to his family regarding football decisions. Daniel’s Uncle, Dean, is also Daniel’s agent. Therefore, they are also always in communication regarding football matters. In football, it is quite common practice to hunt down betting lines to determine whether certain situations, in this case transfers, materialize. In this case, Daniel gathered with his family to celebrate Leon’s (Daniel’s brother) birthday and told his family members the possible transfers that could occur, for example whether he thinks he is moving to Inter Milan or Sevilla.
Addressing whether the information provided to the family was inside information, the Appeal Board stated:
“At paragraph 139 the Commission found, as a matter of fact, that the Respondent probably told the members of his family who were present at his parents’ home in the late evening of 16 January that it was becoming increasingly obvious to him that Inter Milan was the only real option available. The Commission held by a majority, with the Chair dissenting [the minority], that the FA had not proved that this information was not publicly available at the time the Respondent expressed that view to his family . . . We are firmly of the view that the minority view was the correct analysis.”
The Regulatory Commission opined that the information told by Daniel to his family could be deduced by public information and therefore was not “inside information”. The Appeal Board disagreed and stated they simply cannot accept that Daniel’s personal opinion, expressed that evening to a very limited number of people, was information which was publicly available. The evidence provided could not adduce that Daniel’s state of mind was publicly available.
Daniel took exception to this interpretation and to the fact that he did not bet, nor his family or close friends, but the Appeal Board still found him in violation.
Is this interpretation dangerous and should personal statements based on belief and quasi-facts be considered inside information, especially if the information is brought to the attention of family members in order to help make a career decision rather than for gambling? This ties in with the facts mentioned above, because Daniel always talks with his family regarding football decisions. So are all other statements made to his family to help him decide also inside information? I am sure that Daniel is not the only one who confers with his family on such decisions. Daniel expressed his desire to fight to continue to “campaign for professional footballers to be able to speak to their families and close friends freely, without the real risk of being charged”. Yes, other elements of E8(1)(b) must still be proved, however, if this type of personal belief is considered almost per se “inside information” it is easier to bring insider trading charges against footballers, as one of the elements is already satisfied. This decision certainly is a slippery slope and one can understand why footballers in the future may not freely talk with family members like Daniel mentioned in his video.
Prior to the Daniel Sturridge incident, there have been prior violations of the FA gambling rules. Joey Barton was banned by the Football Association in April 2017 for breaching betting rules. Barton was found to have placed 1260 bets on football matches over ten years. Initially, Barton was given an 18 month ban from football and had to pay a £30,000 fine. However, on appeal the ban was reduced to 14 months. Comparing Daniel’s punishment to Joey’s, did the Appeals Board harshly punish Daniel? Not only did Daniel terminate his contract with his current team, he has to pay a fine 6 times larger than Joey – despite the fact that neither Daniel or anyone in his family placed any wagers. A 4 month ban certainly isn’t as long as a 14 month ban, but Joey placed 1260 bets, while Daniel placed none. While Daniel did instruct Leon to place a bet of £1,000 (which in my suspicion the underlying intent was more of a joke than actual instructions and never actually came to fruition) the ban is definitely lopsided. Understandably, the FA wants to make a statement with this punishment on their stance on actions taken that violate the integrity of the game. However, the FA should set an example with its own affairs before harshly punishing its employees.