Hull City have been placed under transfer embargo until January 2027, talkSPORT understands.
The transfer ban is a result of £1m owed to Aston Villa for their loan move for Louie Barry in January.
Hull have been hit with a three-window transfer embargo by the EFL
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Hull have been hit with a three-window transfer embargo by the EFLCredit: Getty
The sanction relates to a £1m payment owed to Villa for the loan signing of Barry
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The sanction relates to a £1m payment owed to Villa for the loan signing of BarryCredit: Getty
Hull are expected to launch an appeal.
Barry joined the Tigers for the remainder of the season after spending the first half of the campaign at Stockport County.
However, the 22-year-old suffered a season-ending knee injury less than a month later.
It caused Barry to miss the run-in as Hull avoided relegation on goal difference following a draw with Portsmouth on the final day.
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Across his time in East Yorkshire, the Villa youngster made just four appearances for the club.
The cost of his time at the MKM Stadium could now impact on Hull's summer business.
New boss Sergej Jakirovic succeeded Ruben Selles in the dugout earlier this summer with owner Acun Ilicali opting to sack the now-Sheffield United boss.
He has since made four new additions, including Gustavo Puerta's loan deal being made permanent.
Meanwhile, Reda Laalaoui, Semi Ajayi and Dillon Phillips have also joined the club.
There will be no more new arrivals for a fee whilst the club are under a transfer embargo, though.
Barry made just four appearances after joining the Tigers in January
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Barry made just four appearances after joining the Tigers in JanuaryCredit: Getty
Ilicali will be unable to spend money on new players until January 2027
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Ilicali will be unable to spend money on new players until January 2027Credit: Getty
Jakirovic's side are set to begin the new season away to Coventry on August.
Hull are not the only Championship side to be hit with such restrictions either.
Sheffield Wednesday were slapped with their third transfer embargo earlier on Thursday as their woes continue.
The Owls had already been sanctioned for failing to pay player wages and unpaid sums owed to HMRC.
Wednesday have now been hit with a third embargo, though, this time for non-payment of transfer fees.
The club were previously banned from signing players for a fee for three transfer windows on June 18.
Simon Jordan reacts to Sheffield Wednesday's transfer ban
Meanwhile, their players could now force a mass exodus due to their unpaid wages.
Those still waiting to be paid are free to hand in a 15-day notice of their contract termination.