Auckland rugby club College Rifles have been found guilty of paying a player, therefore breaching the rules of the amateur game, and must pay a fine and costs of $15,000.
Perhaps even more significantly, the club will be docked 30 competition points should they be found guilty of a similar breach within the next three seasons.
The Herald revealed this morning the details of the Remuera club's transgression in agreeing to pay an Eden under-21 player what has been described as a "substantial" amount of money over two years.
The matter came to light after the player wanted to return to Eden after a couple of games for Rifles and told his original club of the contract which was understood to have been typed on a Rifles letterhead.
This goes against the terms of the Club Participation Agreement.
Auckland Rugby informed the Herald on Friday of their sanction handed down to Rifles after mediation of the affair finished on Thursday night.
An ARU statement read: "A mediation process has concluded between Auckland Rugby and College Rifles Rugby Club. That process has found that there has been a breach of Clause 16, Material Benefit, of the Club Participation Agreement.
"Auckland Rugby takes the commitments made within the Club Participation Agreement seriously and as such has spent considerable time and resource to ensure a thorough and robust process has been conducted between the parties.
"College Rifles have agreed to pay an up-front fine, a donation to the New Zealand Rugby Foundation, and a contribution to the legal costs incurred by Auckland Rugby.
"It has also been agreed that there will be a suspended deduction of 30 competition points to be applied at Auckland Rugby's discretion should there be any further breach within three years."
The Herald has obtained a copy of the decision, co-signed by Auckland Rugby council of delegates chairman Brent Metson and Eden Rugby Club president Peter Kempson.
It found that College Rifles admitted the breach and "openly shared information to assist the investigation process" and that "the player in question played only a limited amount of rugby for the club".
It also found that the Participation Agreement was "limited" and needed further development. Specifically, it found there was a "lack of clarity over the consequences for any practices that are clearly outside the rules, and the spirit of the rules".
Rifles agreed to pay a fine of $5,000 to Auckland Rugby, plus a further $5000 to contribute towards AR's costs. Rifles will pay an additional $5,000 to the New Zealand Rugby Foundation. All must be paid within 21 days.
The suspended deduction of 30 competition points will be applied to College Rifles' senior teams – men's and women's premiers, first grade, and/or under-21 – should a further breach occur within the next three seasons.
College Rifles' men's premiers are currently on top of the table ahead of their final regular-season game against Grammar Tec on Saturday.
The club, which wields considerable influence in Auckland rugby circles due to its wealthy backers and connections within Auckland Rugby, would not comment on the matter when contacted this week.
An Auckland club insider said the widespread rumours of clubs paying players was "massively frustrating".
"This is grassroots rugby and it's not a level playing field. Obviously, if we're trying to recruit and retain players and you have a club offering money then we're always going to lose to those kinds of clubs and it becomes an expectation for kids coming out of school and that sets a pretty bad precedent," the club insider claims.
"Rifles isn't the only club... Everyone knows what's happening. We all know there are players being paid.
"There are other clubs that probably don't want to speak about it because their backyard isn't that clean either."