Cristiano Ronaldo under suspicion, Radamel Falcao investigated, Lionel Messi sentenced… Spain’s courts have been busy tackling the alleged and real multi-million-euro tax evasion of football’s greatest stars.
But while they may be aware of what they are doing, footballers rely on expert go-betweens like big banks to help them manage their finances, and the European Commission is looking into measures that would dissuade these intermediaries from assisting wealthy individuals in avoiding tax.
On top of their mammoth salaries and victory bonuses, the world’s leading footballers earn millions by loaning their name and image for ad campaigns – be it sports equipment, underwear or yoghurt.
AGENTS, ADVISERS UNDER SCRUTINY
Barcelona’s Argentine forward Messi was handed a €2.1 million fine last year for avoiding paying taxes on part of the income he earned from image rights via companies in Belize, Britain, Switzerland and Uruguay.
When it confirmed the sentence last month, Spain’s Supreme Court rejected Messi’s argument that he ignored how his wealth was managed but still expressed surprise at the fact that his tax advisors were not prosecuted.
Monaco’s Colombian forward Falcao, meanwhile, is suspected of having hidden 5.6 million euros in image rights from Spain’s taxman when he played for Atletico Madrid in 2012 and 2013.
His Portuguese agent Jorge Mendes has been put under formal investigation in the case, and will be questioned by a judge on June 27.
Mendes, one of the most influential personalities in the football world, is also the agent of Ronaldo, who risks legal proceedings in Spain after prosecutors alleged this week that he evaded more than 14 million euros in tax through offshore companies.
If the Real Madrid star “is finally put under formal investigation, the judge will also have to ask how guilty the advisors and agents are,” says Carlos Cruzado, head of the Gestha union of civil servants who work for tax authorities.
EU TO FIGHT BACK
In a bid to avoid specialised go-betweens from exploiting legal loopholes to pay as little tax as possible, EU Economics Commissioner Pierre Moscovici will on Wednesday unveil a new directive against “fiscal optimisation.”
“So far little has been done to introduce disincentives for those intermediaries that help clients avoid paying their fair share of tax,” a spokesman for the commission told AFP.
The directive aims to force those who advise people with lots of money or companies to declare the transborder products they propose to their clients to the taxman.
“Tax authorities will then be able to better and much earlier identify the regulatory weaknesses that allow some companies and individuals to substantially reduce their taxes,” he said.
The commission is not targeting just sportspeople. But these often resort to tax experts to manage their wealth – be they individuals, private practices or international banks.
“We’re not talking about an adviser who helps you fill in your income tax return, but offices that are specialised in setting up opaque structures, and many are international banks,” says Jose Mari Pelaez, a tax inspector who specialises in tax havens.
These offices can offer “made to measure” services, he adds.
Last year, it was revealed that many of the 175,000 offshore companies registered in the Bahamas, a tax haven, between 1959 and 2016 were created by banks, according to information leaked to the International Consortium of Investigative Journalists.
Without these intermediaries, it would be very difficult to access a tax haven. “But with a phone call and 500 to 800 euros, such an office can set up one or two shell companies with a bank account in Switzerland or in another tax haven,” says Pelaez. “It takes two or three days and hardly costs a thing.”
Provided by AFP Sport
David Beckham was nervous and moody. Crunch day – yet another one – had arrived for his hopes of creating an MLS franchise in Miami.
Three years of struggle, red tape, legal arguments and public anger had seen the Manchester United legend’s hopes nearly extinguished. Yet last Tuesday, a glimmer of light peeped through the gloom. As I walked into a packed chamber room at Miami City Hall, the tension was palpable.
TV cameras were in position to see if city officials would allow Beckham to buy the remaining $9 million adjacent plot of land to go with the $19 million purchase last year. The former truck depot has become contaminated.
An unused eyesore. While the residents of Overtown – the run-down area of downtown Miami – have recently held their hands up and admitted there’s no choice but to go through with the plans for a 25,000 capacity stadium, the people of Spring Garden the adjoining neighbourhood – had one last chance to throw a spanner in the works.
The final vote went 9-4 in favour of Beckham United, though the former England captain was made to sweat. One by one, angry residents were invited up to the stage. “You’re not thinking about my kids,” said one. “How is she going to be able to do her homework with all that noise coming from a match or concert.”
Others pleaded for county officials to think of the implications. “We aren’t eating Beckham’s baloney,” said another. “We could eat for a month. Why not invest in the arts?” I’m sure, if there was a globally recognised superstar ready to pump in excess of $200 million into the area to create a wonderful, all-purpose, state-of-the-art gallery complex with adjoining activity centres for kids, that could be an option.
It would certainly be a better move than one suggestion of installing a ‘Home Depot’ or ‘Costco Supermarket’ instead.
Of course, a massive retail store with huge trucks unloading day in and day out would inject far more into a fractured community than an embryonic soccer team which can infiltrate all parts of society – both in the Overtown area as well as spreading deep into the vast Miami and South Florida catchment zones.
The stadium will also be a concert venue, staging around 40 events a year. Beckham United officials stressed the nature of the music would be taken into account. There won’t be two weeks of death metal or pumping house music. “It’s not a great deal, but it’s not bad either,” said Miami Dade county commissioner Audrey Edmonson.
“It will also be to the advantage of the residents of Overtown.” This is a poor part of the city which has been dealt a bad hand by local authorities. Overtown itself used to be a bustling area with local businesses at the fore. Now, you wouldn’t walk through there after dark. Yet, the bottom-line is money talks.
While residents’ worries are understandable, the positives of having MLS on the doorstep can not be discounted. Beckham must spend at least $175 million on the stadium. Jobs will be created – around 50 initially with 26 guaranteed to bring in $27,000 per year – with more to follow.
Life will be pumped into the area. Links with schools are being forged. Yes, affordable housing is needed, but the city has known that for years and not done anything. There will be no parking.
Instead, fans will be ferried in from various parts of the city while being urged to walk up to the stadium in an effort to create a European-style atmosphere. With fans traipsing around the streets, local business will be invigorated.
There will be money making options for those desperately struggling to make ends meet. MLS need to approve the stadium plans and investor group while the city itself also must ratify plans. A ball will not be kicked until 2020 at the earliest but the wheels are finally in motion.
Tim Leiweke, the sports entrepreneur who helped bring the Englishman to LA Galaxy from Real Madrid in 2007, told me: “David has been constantly on the phone and he’s been grouchy. “He wants to get on with it but is happy now we have control of the situation instead of the situation taking control of us.”
South Korea have two Barcelona players in their squad but all the attention when the FIFA U20 World Cup kicks off on Saturday will be on the “Korean Messi”, Lee Seung-Woo.
Midfielder Paik Seung-Ho is highly-rated but Lee, who plays for Barcelona’s Under-19 team known as Juvenil A, is the one who has the national media giving daily updates on his fashion style and choice of hairbands.
The original Lionel Messi won the “Golden Ball” as the tournament’s best player in 2005 along with the “Golden Shoe” as top scorer in 2005 and has been the inspiration for Lee ever since he was spotted by the Spanish club giants in 2010 and recruited the following year.
It is not just the dribbling, the pace and the confidence that Lee, 19, possesses that remind of the Argentine star but his goalscoring exploits at Barcelona. At the age of 13, he was breaking Messi’s club records.
Diego Maradona was in Seoul in March for the official draw for the tournament. “I have heard a lot about Lee,” said Maradona, another Argentine winner of the tournament MVP award in 1979.
Korea have been drawn with the South Americans in Group A along with England and opening day opponent Guinea.
Sixteen of the 24 teams that start the tournament will progress to the second round, the top two teams from each of the six groups and four of the best-performing third-place finishers.
“A football team has 11 players on the pitch, but in decisive moments, key players like Lee and Paik need to step up and make things happen,” said Choi Kang-Hee, coach of 2016 AFC Champions League winner Jeonbuk Motors.
“Lee has the ability to change a game and has the makings of an excellent player.”
The young Taeguk Warriors reached the last four back in 1984 and the last eight twice in the last four tournaments and need Lee to be on top form if there is to be a chance of, at least, matching those past performances.
At the moment, the player is looking good. In Friday’s warm-up with South American champion Uruguay, Lee scored the first goal in a 2-0 win.
“Uruguay are a very strong team and it is good to score against them and good for us to get the win,” said Lee.
1. Lee Seung-woo, 19 ans, Corée du Sud, FC Barcelone B, ailier.— Ⓜ️arin Cusset ⚜ (@MarinCusset) May 16, 2017
Surnommé le "Messi d'Asie". pic.twitter.com/8nyWY9CWtl
“We are focused on the first game of the tournament with Guinea. They have had good results in Africa and we know they are skilful and physically strong. It will be a tough game.”
He does not however have a personal target of goals for the tournament. “If we can stay long in the tournament, then I should have many opportunities to score… if we give our best effort and run more than our opponents, there will be good results. “We want to go all the way and show what we are made of.”
Lee has been one of the biggest stars in Korean football since earning rave reviews for Barcelona.
He also shone in 2014 as South Korea reached the final of Asia’s U16 Championship. He came to attention to the wider world as Barcelona’s recruitment of Lee led FIFA to hit the club with a two-year transfer ban after for breaching regulations for the transfer of minors.
Lee was subsequently unable to play competitively for the club until he turned 18 in January 2016.
That is all in the past. Lee has a chance to show fans around the world, and especially those in South Korea, how accurate his nickname is.
“Since I joined Barcelona Juvenil A, my goal has been to make it to the senior national team and Barcelona FC,” said Lee. “I want to challenge myself further after leading the team to a win at the U20 World Cup.”
Provided by AFP Sport