Premiership sides Bath and Saracens are being investigated by Premiership Rugby for alleged breaches in the salary cap which could see them hit with heavy points deductions and fines.
The investigation is under way after a ‘whistleblower’ testimony has indicated that clubs are flouting the current salary cap rules.
This is believed to be the reasoning behind recent claims from Saracens that the salary cap should be abolished after claiming that it is ‘outdated’ and ‘possibly illegal’.
The whistleblower is believed to be a disgruntled player’s agent who has complained to Premiership Rugby’s recently appointed salary cap auditors.
It has been claimed that Saracens South African players regularly receive payments into offshore accounts in order to avoid the cap.
‘Saracens have been backed into a corner and that’s why they’ve come out and said what they’ve said at this particular time,’ said one source. ‘A whistleblower has dished the dirt. It could be messy.’
The investigation is also believed to be looking into the deal that saw them sign Scotland lock Jim Hamilton recently.
Bath have drawn attention as a result of a number of big money offers including the likes of Rhys Priestland and Duane Vermeulen.
The potential sanctions both clubs face range from a four to 40 points deduction and a £75,000 to £250,000 financial fine.
The clubs could also face fines of £3 for every £1 over the cap they have gone which could rise to as much as £10 for every £1 for a third offence which could see both sides facing fines of £2.5m for breaches over £250,000.
A Premiership Rugby spokesman said: ‘Premiership Rugby cannot comment on whether investigation proceedings are taking place or not. Any such investigation would be done under the salary capping regulations 2013-14.’
The London club believe the cap is a restraint of trade. They say it hampers clubs’ ability to compete with rich French giants like Toulon and Racing Metro — who this week signed All Black Dan Carter on a deal worth around £800,000 per season.
Bath have received huge financial backing from their new millionaire owner Bruce Craig in recent seasons.
‘The salary cap has served its purpose,’ said Saracens chief executive Edward Griffiths.
‘It would be a pity if the world’s top players light up the World Cup on English soil and then leave to play club rugby in France.
‘If the salary cap is left to forbid the required investment, it will kill any hope of growth.’
A Premier Rugby statement read: ‘The salary cap ensures the financial viability of the member clubs and underpins the sustainable growth of the competition for all stakeholders.
‘In addition, the salary cap provides a level playing field for all clubs, ensures a competitive Aviva Premiership Rugby competition, promotes homegrown players and supports the performance of the England team.
‘It allows the recruitment of elite players from other countries through the excluded players provision.’
Saracens’ claim that they have significant support appeared unfounded.
Exeter chief executive Tony Rowe said: ‘We believe at Exeter that the salary cap should be higher than it is but we don’t think it should be abolished. We’d support it being raised to around £7.5-£8m to put us on a par with a lot of the French clubs.’
Leicester, whose 24,000-capacity Welford Road stadium and large fan-base sees them generate the highest revenues from ticket sales in the Premiership, also appear to be against an abolition.
A club insider said: ‘The club is already stretched to the maximum by paying up to the salary cap. There’s no appetite to abolish the cap. It would be disastrous for Tigers.’
Harlequins distanced themselves from Saracens while Wasps are understood to have told Premier Rugby they have no interest in scrapping the cap.