Everton have been docked 10 points for breaching financial fair play rules.
The Toffees have been found to be in breach of the Premier League’s profitability and sustainability rules.
These allow clubs to lose a maximum of £105million over a three-year period or potentially face sanctions.
The decision comes after the league referred Everton in March to an independent commission after reviewing the financial records of all top-flight clubs for the 2021-22 season.
Everton reported losses of £124.5million for the relevant period.
The 10-point deduction incurred by Everton is the biggest sporting sanction ever handed out by the Premier League.
The penalty, effective immediately, leaves the Toffees with four points for the season so far and puts them into the relegation zone.
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Everton intend to appeal, saying they are ‘both shocked and disappointed’ by the finding.
The news sent shockwaves around the English football world, with many football figures having their say on the matter.
For instance, Paul Merson took to X with a 10-word message appearing to support Everton and seemingly criticising the Premier League.
“Top 6 won’t be caught if teams can’t spend money,” he wrote.
Aside from the shock regarding the punishment handed out to Everton, the decision has also put into focus other Premier League investigations and how those clubs will be dealt if also found guilty.
For instance, Manchester City have been charged with more than 100 alleged breaches of the rules by the Premier League.
They are yet to have a verdict amid legal wrangling on both sides and City have denied wrongdoing.
Meanwhile, Chelsea are under investigation for alleged breaches relating to the era of Roman Abramovich’s ownership.