Everton face having negative points with the Premier League recommending a points deduction for Financial Fair Play breaches, according to reports.
The Toffees have endured a difficult start to the new season, winning just two league games so far.
Everton haven't been relegated from the Premier League since it was created in 1992.
It was revealed that last week that Everton's disciplinary hearing into alleged breaches had already started, with an independent commission set to make the final decision.
Everton will struggle to stay in the Premier League if slapped with a points deduction
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A verdict on the club's financial situation is set to be delivered later this week.
That's despite the Toffees mourning the death of owner Bill Kenwright, who died on Tuesday.
The Premier League have, according to the Daily Telegraph, called for Everton to be given a huge punishment if they're found guilty of breaking the rules.
Should wrongdoing be proven, they're ready to demand the Merseyside giants be slapped with a 12-point deduction.
With the club only taking seven points so far, that would leave them bottom of the table with -5 points to their name and leaving them with a huge task to stay in the top flight.
Everton have been able to fend off the threat of relegation in recent years.
They managed to stay in the Premier League last term with a narrow 1-0 victory over Bournemouth on the final day, with Abdoulaye Doucoure scoring the only goal of the game.
But losing 12 points would give the club their hardest task to date, having not been relegated for 69 years.
The Premier League, it seems, want to set a strong example by slapping Everton with a record-breaking punishment.
It is out of their hands, however, with an independent commission instead set to make the final decision.
Everton are confident they will be cleared of any wrongdoing.
They released a statement back in March that read: “Everton Football Club is disappointed to hear of the Premier League’s decision to refer an allegation of a breach of profit and sustainability regulations to an independent commission for review.
“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 club will not be making any further comment at this time.”
Everton boss Sean Dyche was asked about the club potentially being docked points last week.
And he hit back at allegations of wrongdoing by saying: "I know what I need to know and that's enough for me.
"I don't need to add in another level of someone's opinion.
"I know what I know from inside, it is often irrelevant what someone is saying from the outside because I know what's going on."
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Everton boss Sean Dyche was asked about potential FFP breaches last week
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On the independent hearing, Dyche added: "I've stepped into the middle of it but it's certainly not something that involves me as manager, but sort of distantly does from the fact that I am manager.
"I am sure there are people talking about lots of different things.
"I'm just looking at what we can control and I certainly can't control that side of the club.
"I will wait and see the outcome, what it is and when the timelines are.
"I don't know any more than that."
Everton owner and legend Bill Kenwright died on Tuesday with the club in mourning
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No club has ever been punished for breaching FFP since it was introduced a decade ago.
Everton believe they lost out on a staggering £170million as a result of the coronavirus pandemic in 2020.