Parramatta are facing a fine of over half a million dollars in what is the NRL’s heaviest salary cap penalty since Melbourne were stripped of two premierships.
The Eels were hit with a preliminary breach notice of $525,000 on Thursday for overspending in all four of the game’s salary cap categories last year.
They will also be penalised four competition points at the start of next season – unless the club undertakes an independent review of its governance and organisational capability by February 29, 2016.
NRL CEO Dave Smith said that there are currently no concerns on the club’s prized signings of Kieran Foran and Beau Scott for next year.
The penalty is the second biggest fine the NRL has handed out since its inception in 1998, however Smith was adamant the Eels hadn’t rorted the system.
“This is the fourth out of five years that we’ve seen salary cap breaches in that club,” Smith said.
“I don’t think this is about cheating. This is about mismanagement.
“A lot of the things across the game that we’ve tried to do is prevent these things happening in the future because they invariably take a number of years to fester and bubble.”
It is the first time all four tiers of the salary cap – the NRL, the NRL’s second tier, the National Youth Cup and the NYC second tier – have been breached.
The Eels overspent by over $400,000 in total, $244,036 of which was in the NRL’s second tier cap.
“That’s why there’s a $525,000 fine, and that’s why there’s the potential loss of four competition points unless we fix this for the long-term going forward,” Smith said.
Smith expected the independent review would be a transparent process.
“We’ll make sure that we’re on top of who does that review,” he said.
“The club will run it and we’ll also make sure that we’re very clear on its terms of reference.
“We will then require the club to make any reasonable changes that are recommended through that review and we would expect those changes to be made by the end of February 2016, otherwise the club next year with a loss of four competition points.”
Smith also criticised the political infighting which has plagued the club in recent seasons, but remained confident of its direction under chairman Steve Sharp.
“The other thing I would say is that the club’s seen a fair amount of churn over the last few years,” he said.
“Both CEOs, coaches, and indeed the senior people in the organisation… that environment makes it quite difficult for folks to manage these complex areas.
“The other thing I will say is that Steve Sharp has put a number of reforms in place and he is directionally taking the club where it needs to be.
“This [breach] is consistent with some of the problems they’ve seen in the club over the last few years.
“I hope that once we’ve done the review and we’ve got independently clarified where the gaps are, those gaps will be closed.”
Parramatta has seven days to respond to the breach notice.
NRL’s BIGGEST FINES FOR BREACH OF SALARY CAP
2010 – The Melbourne Storm are stripped of two premiership titles, three minor premierships, docked all points for 2010, fined $500,000 and ordered to return $1.1 million in prizemoney after over-spending the salary cap by $1.7 million over five years.
2002 – The NRL disqualify the Bulldogs from the 2002 final series, impose a $500,000 fine and a 37 premiership point penalty after detecting $1 million in salary cap breaches.
2015 – The NRL impose a $525,000 fine on Parramatta for salary cap breaches.
2006 – The Warriors are stripped of four competition points and fined $430,000 for breaching the salary cap by almost $1 million.