Melbourne Storm salary cap breach

The Melbourne Storm salary cap breach was a major breach of the National Rugby League's strictly enforced salary cap by the Melbourne Storm club over a period of five years. The discovery of these breaches in 2010 by the NRL resulted in it stripping the Storm of all honours achieved as a team since 2006 (including the 2007 and 2009 premierships and 2006, 2007 and 2008 minor premierships), and sentencing them to finish the 2010 NRL season in last. Melbourne also had its 2010 World Club Challenge title revoked, more than one year since the initial penalties were first announced.

Following claims by a whistleblower that the club was keeping a second set of books, the NRL conducted an investigation in late 2009 and early 2010. After initially denying the claims, Storm officials confessed on 22 April 2010 that the club had committed serious and systematic breaches of the salary cap for the last five years by running a well-organized dual contract and bookkeeping system which left the NRL ignorant of $3.78 million in payments made to players outside of the salary cap, including $303,000 in 2006, $459,000 in 2007, $957,000 in 2008, $1.021 million in 2009 and $1.04 million in 2010.

As a club's compliance with the NRL salary cap is supported by statutory declarations, the club's owners requested that fraud and perjury charges be laid against those responsible and stated that any person who knew of the breach would be expelled from the club. The Victorian Fraud Squad began preliminary investigations on 23 April, and the Australian Securities and Investments Commission also made preliminary investigations and indicated an interest in investigating breaches of the Corporations Act. Storm executives had arranged for inflated invoices to be submitted to hide the payments to players. This involved submitting invoices of up to $20,000 above the real value of the services rendered with this amount paid directly to players by the third party suppliers, although there was no suggestion that the suppliers were involved in submitting the inflated invoices.

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