It turns out that Lionel Messi’s injury in Barcelona’s 2-1 victory over Las Palmas last month isn’t the most painful thing to happen to him this season. Days after it was reported that Spain had dropped criminal tax charges against the footballer, it appears that the trial is on again.
Earlier this week, El Pais reported that the prosecution would drop criminal tax charges against the soccer star and only move forward against Messi’s father. However, according to court documents made public today, that request was overruled. El Pais now reports that “acting in opposition” to the Fiscalía (think of it like our District Attorney), a higher state authority (the State Bar which defends the interest of Spain’s Treasury) wants the case to proceed.
Contrary to the prosecution’s determination that Messi did not actively participate in the alleged fraud, the Treasury believes that Messi acted “de forma consciente y voluntaria” (consciously and voluntarily). Prosecutors in the case had originally found that Messi’s father, Jorge Horacio Messi, was solely responsible for the alleged fraud.
By rejecting the prosecution’s dismissal (I know, that’s confusing), the judge has decided that Lionel Messi and his father Jorge will both stand trial for three counts of tax fraud. The latest indication is that Messi and his father could each face a jail sentence of 22 months and 15 days together with a fine of €4.1 million ($4.62 million U.S.).
It’s yet another twist in a long and complicated case that began in 2013, when a complaint was filed alleging that Messi’s father initiated a scheme using a series of shell companies in tax havens to shield royalties and other licensing income from Spanish income tax. Income from lucrative contracts with such companies as Pepsi-Cola, Procter and Gamble, and Adidas was allegedly funneled to Belize and Uruguay through an elaborate maze including the U.K. and Switzerland. The scheme reportedly allowed the pair to avoid paying nearly €4.165 million ($5.5 million U.S.) in tax.
After the charges were made public, Messi took steps to clear the tax debt, making a “corrective payment” of €5 million ($6.57 million U.S.). That did not, however, discourage the case from proceeding.
Despite the hits to his reputation, Messi held onto his endorsements, earning $74 million in salary and endorsements just last year. That was enough to land him the #13 spot on Forbes’ Celebrity 100 (up from #45 in 2014) and the #4 spot on Forbes’ list of World’s Highest Paid Athletes (behind boxers Floyd Mayweather and Manny Pacquiao and fellow footballer Cristiano Ronaldo).
Messi’s team, FC Barcelona, is thought to be worth $3.16 billion. Forbes ranks the team at #2 on its list of the World’s Most Valuable Soccer Teams – just behind La Liga rival Real Madrid.
(For more on the World’s Most Valuable Soccer Teams, see the slideshow below.)
However, FC Barcelona has certainly seen its share of tax charges recently. Just last month, a Brazilian judge charged that fellow FC Barcelona player Neymar da Silva Santos Júnior (Neymar took steps to avoid reporting income and paying tax and ordered 188.8 million reals ($47.75 million U.S.) of Neymar’s assets frozen. Earlier this year, a Spanish Court found that there was enough evidence to charge Neymar’s club, FC Barcelona, club president Josep Bartomeu, and former club president Alexandre “Sandro” Rosell with tax evasion related to Neymar’s signing. And, just a few weeks ago, Spanish authorities announced an investigation into underpayments allegedly made by midfielder Javier Mascherano.
(Quick note: Legal procedures vary from country to country. To help me – and you – more fully understand what’s going on in Spain, I’ve asked a legal colleague in Barcelona to weigh in. I’ll update you once I have more information.)
