The Premiership champions were found to have breached salary cap regulations.
Saracens statement in full
Premiership champions Saracens have been given a massive points deduction, and fined £5m, after a salary cap investigation.
The club were being investigated for practices over the past seven months.
It was claimed that a number of Saracens high-profile stars – including England players Owen Farrell, the Vunipola brothers and Maro Itoje – had entered into investment partnerships with the club’s chairman, Nigel Wray.
The club now faces a relegation battle this season, despite winning the competition last season.
A 35-point deduction is the maximum penalty under the salary cap regulations.
The salary cap itself is designed to prevent individual teams from monopolising the league – effectively making it a level playing field for all clubs.
Each Premiership side have a salary cap of £7m, plus two marquee players.
Allowances can be made for certain home-grown individuals, and English-qualified players, however.
A Premiership Rugby spokesperson said: “The Salary Cap is an important mechanism to ensure a level playing field for Premiership Clubs and maintain a competitive, growing and financially sustainable league.
“Today’s decision by the Independent Panel upholds both the principle of the Salary Cap and the charges brought following an extensive investigation by Premiership Rugby. We are pleased that this process has reached a conclusion and we look forward to another exciting season of Premiership Rugby.”
Saracens have confirmed their intention to appeal the decision under the regulations. The club could only appeal if there was been an error of the law, the decision was irrational, or if there was been some kind of procedural unfairness.
If appeals process goes ahead, the points deduction and fine will be suspended until after the outcome of the review.
Saracens are already three games into the 2019-2020 Premiership season, and are fourth in the table.
They’ve already been awarded nine points after winning two of their three fixtures, and picking up a losing bonus point.
While Saracens would undoubtably be anxious about the prospect of relegation, a 35-point deduction wouldn’t have resulted in relegation in any season over the past 11 years.
They now face a tough fixture against Gloucester on Saturday (3pm).
Saracens statement in full
“Saracens Rugby Club is shocked and disappointed by these heavy-handed sanctions and will launch an appeal against all the disciplinary panel’s findings.
“The Club is pleased the Panel acknowledged it did not deliberately attempt to breach the salary cap and steadfastly maintains that player co-investments do not constitute salary under the regulations. This view is supported by independent legal and professional experts.
“The Club will continue to vigorously defend this position especially as PRL precedent already exists whereby co-investments have not been deemed part of salary in the regulations.
“As previously stated, the Club made administrative errors relating to the non-disclosure of some transactions to PRL and for this we apologise. We are pleased to confirm we now have a robust governance framework in place and this will be overseen by an external counsel to ensure the Club follows best practice.
“Furthermore, it is the Club’s belief that the Panel’s narrow interpretation of the regulations is detrimental to player welfare across the league and is damaging the development of elite level rugby in the UK.
“Saracens is proud of its pioneering, innovative approach to player welfare, developing their talents and supporting their entrepreneurial spirit for life beyond rugby.”