Barcelona have been reportedly accused of tax evasion and irregularities in €42m signing in 2018.
Barcelona accused of tax evasion and irregularities over €42m 2018 signing originally appeared on The Sporting News. Add The Sporting News as a Preferred Source by clicking here.
Barcelona are reportedly under investigation for allegedly evading taxes during their 2018 deal to sign Brazilian winger Malcom in 2018.
According to reports from El Periodico and the Mossos d'Esquadra [Catalan police], irregularities have been found in the deal to land Malcom from Bordeaux for €42m [£35m/$46m], including an alleged payment of €10m [£8.7m/$11.6m] by Barcelona to Business Futbol Espana (BFE) for 'intermediation services' that were non-existent or overvalued.
Investigators further allege the payments between 2018 and 2020 were reportedly used to avoid tax obligations by changing the original employment contract between the club and player.
The contract initially signed with Malcom, which included €10m[£8.7m/$11.6m] in payments over three years, was reportedly later changed to €1.5m[£1.3m/$1.7m] directly and €8.4m[£7.3m/$9.7m] routed through BFE, which Mossos officers described as a 'clear modification' that brought down the player's income tax withholding of around 50%.
The authorities' investigation also found evidence of a second 'framework agreement' between Barcelona and BFE, predating 2019, but was originally penned in 2020.
Investigators have reportedly uncovered that nine out of the 12 invoices probed so far have been deemed to differ from real services, possibly pointing to false billing to complete the fee owed to intermediaries in the deal.
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What's next for Barcelona amid another financial storm?
This recent financial probe into Barcelona is part of a wider investigation into irregularities under Josep Bartomeu's presidency from 2014 to 2020.
The investigation also includes former executives including Oscar Grau, Jordi Mestre Masdeu and Francisco Schroder Quijano, with prosecutors believing they were involved in the mismanagement of club funds and kept the real nature of multiple payments from the board.
Bartomeu has also been charged over alleged €30m [£25m/$33m] in commissions during the transfers of Neymar and Antoine Griezmann, following a complaint filed by current Barcelona president Joan Laporta.
According to a report by the authorities, such practices under Bartomeu's presidency caused damages worth millions to the Catalan club and its shareholders.
The investigation is still in progress, and Spanish courts are yet to decide if formal charges will be filed against Barcelona or just the individuals involved.
Laporta's board have conducted a 'preventive tax regularization' to prevent sanctions in an attempt to keep the club away from past management's practices.
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