Rorting the cap

The murky world of secret payments to rugby league players to circumvent the salary cap is haunting the Parramatta Eels, with Eddie Obeid jnr admitting to financially assisting troubled star Chris Sandow, providing a discounted apartment to Darcy Lussick​ and offering real estate advice to Will Hopoate​.

Mr Obeid jnr, the son of disgraced former Labor powerbroker Eddie Obeid, is alleged to have organised for Sandow’s estimated $550,000 salary to be topped up by as much as $200,000 a year and for Hopoate, who earns about $750,000, to be paid an extra $50,000 to $100,000 a year in deals not registered with the National Rugby League.
Eddie Obeid jnr.

Eddie Obeid jnr. Photo: Nic Walker

In what has been described as a massive conflict of interest, a Fairfax Media investigation can reveal that for years the controversial former Eels chairman Roy Spagnolo directed a number of third-party player payments, including money owed to Jarryd Hayne, into front companies he had set up for his own property development deals.

Mr Spagnolo, who controlled the club from 2009 to 2013, was recently found to be “not a fit and proper person” to run a registered club. This follows a lengthy investigation into the club’s governance by the Independent Liquor and Gaming Authority.

Sources close to the Parramatta club have claimed that off-the-book payments, which could total more than a million dollars, were made during the Spagnolo regime. The extent of the problem has been coming to light in recent times.
Jarryd Hayne.

Jarryd Hayne. Photo: Mark Nolan

One example is a payment of $18,000 in September 2012. Although the payment was ostensibly for financial services, a handwritten notation on the back of the invoice indicates the money was for then player Luke Burt.

Fairfax Media can reveal the payment from the club went to a company formerly run by an employee of Mr Spagnolo’s and controlled by a close associate. Mr Burt, who was personally managed by Mr Spagnolo, retired at the end of 2012. He is now on the Eels coaching staff.

One unregistered third-party payment to star player Hayne went into a Spagnolo-controlled company, Abdullah Pty Ltd, even after Hayne had left the Eels to play American football with the San Francisco 49ers.

Despite no paperwork, in December 2014 the Parramatta Leagues Club paid $26,000 to Abdullah Pty Ltd on Hayne’s behalf.

Another payment for $26,000 was made to Hayne’s manager, Wayne Beavis, in April this year.

Fairfax Media does not suggest any of the players knowingly breached the salary cap.

Mr Beavis expressed alarm when informed this week that Mr Spagnolo was behind the mysterious company into which some of his client’s money was being invested.

“If I had known that, we would have made sure it didn’t happen. You can’t have that conflict of interest,” said Mr Beavis.

Mr Beavis said the agreement was reached with the recently departed chief executive Scott Seward​. “We reached a third-party agreement to keep Jarryd current with the company and we sent them two invoices and they were both paid,” he said.

Mr Beavis said that the payments weren’t registered “because I never got any paperwork off the club. That’s not my fault. That’s the club’s fault,” he said.

Mr Seward was unable to comment due to a confidentiality agreement and Mr Spagnolo did not return calls.

Mr Spagnolo’s cousin, Roy “Billy” Spagnolo, Hayne’s accountant, told Fairfax Media that “Abdullah is an investment company” into which Hayne’s third-party payments were paid.

However, a bitter legal battle between Roy Spagnolo and his former close friend and business associate, George Gaitanos​, has revealed that it is Mr Spagnolo himself who controls Abdullah Pty Ltd, which is demanding a $4.3 million payment from Mr Gaitanos over soured property deals.

Mr Gaitanos is accusing his former friend of misleading and deceptive conduct and claims that by getting investors to put money into Abdullah, Mr Spagnolo was running an unregistered investment scheme.

When asked if Abdullah was a registered investment scheme, Billy Spagnolo said he couldn’t answer any more questions. “Are you sure you are not calling from the tax office?” he asked.

Club insiders say that Sandow’s manager, Isaac Moses, recently demanded the club honour payments promised to his client by Mr Obeid jnr but the club is refusing to accept responsibility for what appear to be unregistered deals previously negotiated by the former regime.

Mr Moses, who denied making the demand, said he never comments on client’s contracts.

As for Mr Obeid jnr, he initially declined to comment on allegations he had being paying Sandow between $100,000 and $200,000 per year.

He also declined to answer questions about rumoured payments to Hopoate, but he was happy to confirm that his family’s company had sold Lussick a discounted unit in Top Ryde.

“Yes, that’s true. I don’t have any issue with that. I helped him with his unit,” said Mr Obeid jnr.

The following day, Mr Obeid jnr said that as “a property developer and friend” he had provided advice to Hopoate about the property market.

He also said he “personally helped Chris [Sandow] in a small capacity financially from time to time as a friend”, but that his attempts to secure third-party deals for Sandow via business associates had failed.

“Given Chris’s continual issues both on and off the field, companies felt it was not in their best interests to hire Chris’s services. It was just too hard, given his circumstances,” said Mr Obeid jnr.

As to Mr Obeid’s motivation, he said the answer was simple. “I love the club. If asked, I will always help anyone associated with the Parramatta Eels.”

He went on to have swipe at the new management.

“In my opinion, good people have come and gone at the board and administration level - smart, honest business people who have the contacts, experience and business acumen to deliver the Eels safely into the future. Sadly, they have been moved on because they wouldn’t bend on their business principles.”

The National Rugby League sets salary caps for the clubs; players can earn unlimited amounts of money outside the club, but there are rules.

Players can receive money from corporate sponsors who are not associated with the club and who do not use the game’s intellectual property, such as club logos, jerseys or emblems. These third-party arrangements have to be approved and registered by the NRL.

The TPAs, as they are known, may not be negotiated by the club as an incentive for a player to sign a contract, nor can they be guaranteed by the club.

But there is a shadowy world where the salary cap is breached through players receiving money off the books. Common methods include paying for holidays, cars, offering free rent or organising discounted property purchases.

Read more: > http://www.smh.com.au/rugby-league/parramatta-eels/jarryd-hayne-eddie-obeid-jnr-the-parramatta-eels-and-the-murky-world-of-secret-player-payments-20150723-giib8b.html#ixzz3gkKuMwYd


http://www.smh.com.au/rugby-league/parramatta-eels/jarryd-hayne-eddie-obeid-jnr-the-parramatta-eels-and-the-murky-world-of-secret-player-payments-20150723-giib8b.html

I guess if the Bulldogs Raiders and Melbourne have done it, and Parra are doing it, then clubs like the Broncos, Roosters Souths etc etc arent. 😒

That’s for sure ink, nothing like an nrl ‘level playing field’
So will the nrl do a serious investigation into this and wider references?
Of course they won’t…

Maybe its just wishful thinking to avoid the spoon but i hope Parra are stripped of their points and take another spoon.

This topic however is a real concern for the Wests Tigers because we now have NRL appointed auditors errr i mean board members who will never allow us to make these sort of arrangements. We might as well play State Cup because the difference in squad strength between the top teams who successfully recruit this way and those who play by the rules will only become greater. It leaves a team like ours severely disadvantaged and destined to years of mediocrity.

What gets me is a couple of journos can unearth these rorts with a bit of digging in between their other duties yet the NRL who has a team dedicated to finding and policing these rorts come up with squat.

Quote Tiger in the Gong: “We might as well play State Cup because the difference in squad strength between the top teams who successfully recruit this way and those who play by the rules will only become greater.”

I agree and my feeling is that, unless the NRL deals with the apparent disparity between how clubs/players are funded, it will be the death of the game. Supporters will simply lose interest in a one sided competition.

As I posted in another thread; It won’t happen because of commercial in confidence issues but I’d love to see a line for line expose of our current cap structure, placing that next to the same for a club like the Roosters or Rabbits. Baffling. The administration of our cap must have been monumentally incompetent.

Strip them of their SPOONS for 2012/13…

Hey but they signed Foran… 😒

All most punters want is at the start of the season when the ball is kicked off in round one is, some real belief that their team is in with a chance of getting to the big games at the end of the season, and of course that was one of the objectives of bringing in the cap. Now with all the rorting that must be going on and the inequity of the TPA’s system we have teams like ours stuck in quick sand at the bottom of the ladder with little or no hope of being able to mix it with the teams at the top.

Dont get me wrong we are not without blame, diabolical management and leadership has not helped our cause but we are stuck in a system that really stinks

It’s hard to compete with specialist rorters and if we did we would be the only ones risking jail time.

Make no mistakes about it but Clubs will always find a way in the System to have more than there fair share of Marquee players, well the richer Clubs anyway.

Us fans are not stupid and can see what’s going on. That is why the NRL has to put a value on players for Salary Cap purposes and sharing the Marquee players amongst 16 Clubs to have an even competition.
It’s not to say they can’t get extra dollars through 3rd party agreements but a Club has to stay inside the Cap with the value the NRL has set. IMO.

Maybe even an AFL player Draft system?

If the NRL ever got Fairdinkum,they would have the salary cap,no TPAs for any club,no paper bags full of uncle nicks money etc…

There should be for example something like…if you play in the NRL you are payed x amount per season for y amount of years…no back loading contracts and no underhanded help outs…

If you want to earn more than anybody else go overseas or what ever,our game will never be on a level playing field while some clubs have huge sponsors and the Uncle nick types…

I’m probably way off the mark,but every year there is crap after crap regarding the salary cap with to many want to be’s trying to get in the mix…Parra for example with Obied jr,another who has the reputation as big as the Mafia itself,have a look at his old man,using his position of power in politics to feather his own nest…
Most of these type don’t just give away money for the sake of being a nice guy…there is always something in it for them to make more money out of their investment…

Until the NRL have the gusto to stand up to every individual club and work out a formula that keeps everyone on the same page rather than favouring one more than the other…then I’m afraid we will have plenty of more salary drama as we go on…

I’ve had my rant but it’s just the way I feel about the situation,maybe that’s why I can’t stand teams like Roorters,dogs and Storm…

I just want to clear this up - payments by Obeid Jr are technically not rorting the salary cap, correct? There is player salary, plus TPAs with companies associated with the club, but any benefactor-type arrangements are outside the cap?

For example, if I was Uncle Harry, I could personally agree to sponsor / aid / help out (whatever you want to call it) particular players associated with the club I support, and Tigers would not have to declare such payments?

Isn’t this what the Thoroughbreds do for Broncos?

I’m not upset at Parra or dirty on the NRL for not unearthing the issues - I want to know why Tigers aren’t bending the rules in the same fashion?

@jirskyr:

I just want to clear this up - payments by Obeid Jr are technically not rorting the salary cap, correct? There is player salary, plus TPAs with companies associated with the club, but any benefactor-type arrangements are outside the cap?

For example, if I was Uncle Harry, I could personally agree to sponsor / aid / help out (whatever you want to call it) particular players associated with the club I support, and Tigers would not have to declare such payments?

Isn’t this what the Thoroughbreds do for Broncos?

I’m not upset at Parra or dirty on the NRL for not unearthing the issues - I want to know why Tigers aren’t bending the rules in the same fashion?

Well TPA payments aren’t supposed to have links to the club like that. So if the Chairman and/or the Leagues Club were arranging the payments through shell companies or fronts then it would be against the rules.

But the whole TPA is a mess. Why bother having a cap when you can just do this sort of thing.

lol we all bend rules- which business actually files a correct tax return every year?

some do it to save $100, some to save $1M- it’s always about not getting caught.

there’s no perfect comp in the world that could have an even playing field… maybe it’s the nature of the game itself of it’s the salary cap but one thing- NRL is the closest comp in the world imo.

as for parra, these guys must be the biggest wannabe businessmen… WT are hopeless no doubt but geeze parra is in a league of their own when it comes to business management. they don’t just bend/break the rules but they do it in such a manner that they get caught easily and what’s more? all they get is the spoon.

wonder if FTB and all the storm haters will call jarryd hayne, luke burt etc a cheat as well (demps must be over the moon with this)

If the clubs and their fans don’t have the courage to highlight and expose the rorting I am sure that the NRL will do nothing at all to change it. So if Wests Tigers want a level playing field they should take action. (Oh my, I forgot that Wests Tigers management were brought in as puppets of the NRL).

@jirskyr:

I just want to clear this up - payments by Obeid Jr are technically not rorting the salary cap, correct? There is player salary, plus TPAs with companies associated with the club, but any benefactor-type arrangements are outside the cap?

For example, if I was Uncle Harry, I could personally agree to sponsor / aid / help out (whatever you want to call it) particular players associated with the club I support, and Tigers would not have to declare such payments?

Isn’t this what the Thoroughbreds do for Broncos?

I’m not upset at Parra or dirty on the NRL for not unearthing the issues - I want to know why Tigers aren’t bending the rules in the same fashion?

Harry has been connected to the club since the 80’s… The NRL will not allow him to start paying players!

The Thoroughbreds have never had any formal association with the Broncos. They are an independant group who like to have beers on friday. 😆

We need Harrys Mates Mates to start having beers on Friday!!!

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