Uefa's club finance investigators have sent their Manchester City file to independent judges for a verdict which could be a one-year ban from the Champions League.
The English champions are suspected of breaking rules that monitor clubs' commercial income and spending on player transfers and wages, and face the most serious sanction which could apply next season.
European football's governing body Uefa confirmed the expected referral to its judging panel yesterday, though did not publish the recommended punishment or a timetable for the verdict.
The chief investigator - Yves Leterme, a former prime minister of Belgium - is required by Uefa rules to propose "the final decision to be taken, including, where appropriate, any disciplinary measures."
City hit back at what it called "a wholly unsatisfactory, curtailed, and hostile process" overseen by Uefa.
"The accusation of financial irregularities remains entirely false and the ... referral ignores a comprehensive body of irrefutable evidence provided by Manchester City," the club said.
Uefa's club finance panel opened its formal case against City in March "for potential breaches of financial fair play regulations that were made public in various media outlets."
Internal documents about City's business and emails between club executives have been published in the Football Leaks series led by German magazine Der Spiegel since last November.
The revelations suggested City officials deceived Uefa over several years, including by disguising that revenue from potentially overvalued commercial deals came from the club's owners in Abu Dhabi.
City can appeal against any punishment at the Court of Arbitration for Sport.
After retaining the Premier League title last Sunday to add to its League Cup win, City can complete a domestic treble by beating Watford in tomorrow's FA Cup final.