The Premier League has reportedly recommended a deduction of up to 12 points from Everton’s current standing due to alleged breaches of financial rules.

In March, the Premier League referred Everton to an independent commission after reviewing the financial records of all top-flight clubs for the 2021-22 season.

While the specific charge has not been revealed, it is thought to be linked to a tax matter concerning loans for Everton’s new Bramley Moore Dock stadium, which is currently under construction.

The disciplinary hearing began last week, with a decision anticipated later in the year.

Now, the Daily Telegraph has reported that the league has asked the independent commission to impose a severe sanction against the Merseyside club.

A deduction of 12 points would result in Everton’s current score dropping to minus five points in the ongoing season’s league table.

According to the league’s profitability and sustainability rules, clubs can sustain losses of up to £105m in three years or potentially face penalties.

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However, Everton reported losses of £371.8m in the past three years and faced annual losses for five consecutive years, amounting to over £430m during this time.

There has been no official response from either the club or the Premier League regarding the details of the report.

When the league referred the club to the commission in March, it cited a potential violation of its profitability and sustainability (P&S) regulations during the period leading up to the 2021-22 season.

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Everton issued a statement on the day when the referral was confirmed, saying: “The club strongly contests the allegation of non-compliance and, together with its independent team of experts, is entirely confident that it remains compliant with all financial rules and regulations.

“Everton is prepared to robustly defend its position to the commission. The club has, over several years, provided information to the Premier League in an open and transparent manner and has consciously chosen to act with the utmost good faith at all times.”

The team is currently subject to a takeover bid by the American private investment company 777 Partners.

Last week, the firm refuted a New York Times report claiming that its bid had stalled due to a failure to provide information to the Financial Conduct Authority (FCA).

Meanwhile, the club’s longstanding chairman, Bill Kenwright, died at the age of 78 on Monday night.

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