Why are Spanish football stars in legal trouble?

(THIS ARTICLE IS COURTESY OF THE BBC)

Why are Spanish football stars in legal trouble?

  • 25 minutes ago
  • From the section Europe
L-R Cristiano Ronaldo, Neymar and Lionel Messi (file pics)Image copyrightGETTY IMAGES
Image captionAll three players: (L-R) Ronaldo, Neymar and Messi

Spain has attracted arguably the three brightest lights of world football, with Cristiano Ronaldo of Real Madrid and Barcelona’s Lionel Messi and Neymar all plying their skills in La Liga.

Over the past year, football fans have become used to seeing the trio caught up in accusations of tax fraud and other financial crimes by the Spanish courts.

And they are not the only players in the crosshairs of the Spanish judiciary. In 2016, Lionel Messi’s Argentina and Barcelona team-mate, Javier Mascherano, received a one-year suspended prison sentence for tax fraud.

Three players, three trials

Lionel Messi and father Jorge were last year convicted of defrauding the Spanish state of €4.1m (£3.6m; $4.6m) in unpaid taxes on the striker’s image rights, controlled by offshore companies in Belize and Uruguay.

The pair were both handed 21-month jail terms in a ruling recently confirmed by Spain’s supreme court.

Barcelona's Argentine footballer Lionel Messi (L) in court with his father Jorge Horacio Messi during their trial for tax fraud in Barcelona (June 2016)Image copyrightREUTERS
Image captionMessi and his father Jorge were convicted of tax fraud in 2016

Now the original Barcelona trial court must decide whether the sentences should be suspended in accordance with Spanish custom for first-time offenders whose prison terms do not exceed two years.

Prosecutors have asked for a two-year sentence and a €10m fine for Neymar, who was cleared of fraud but ordered to stand trial over alleged corruption in his 2013 move from Brazilian club Santos to Barcelona.

Now Ronaldo has become the third and final member of the elite La Liga trio to face criminal accusations, after prosecutors announced they were pursuing the 32-year-old former Manchester United man on four counts of tax fraud.

A source close to Ronaldo told the BBC that “he’s very sad and really upset” about the allegations. “He doesn’t want to stay in Spain. At this moment, he wants to leave,” the source said.

Why has footballers’ paradise turned sour?

Soon after David Beckham joined Real Madrid in 2003, he was able to enjoy a new tax-exemption scheme aimed at attracting foreign talent to Spain across all sectors. That scheme became known as the Beckham Law, when he became one of the first players to sign up to a six-year-long tax ceiling of 24%, roughly half what Spaniards paid on six-figure-plus incomes.

File pic 2006 of David Beckham and Zinedine ZidaneImage copyrightGETTY IMAGES
Image captionReal Madrid’s top players, such as a Beckham and Zidane became known as the “galacticos”

Spain was in the midst of an unprecedented economic boom, a perfect playground for “galacticos” of the likes of Zinedine Zidane and Luis Figo, before the arrival of Cristiano Ronaldo and the emergence of Barcelona prodigy Lionel Messi.

But in 2010 the Beckham Law was scrapped for salaries of more than €600,000, and since then tax inspectors have begun to wise up to the use of complex financial operations using offshore shell companies to get around tax laws.

“The line between avoidance and evasion is very fine in these cases. In the past few years Spain’s tax agency has intensified its control over footballers and their companies, checking to see if they are mere fronts or whether they are really active economically,” explains Carlos Cruzado, president of tax inspectors’ union Gestha.

Case against big three

Neymar is the odd one out. His case involves alleged wrongdoing towards a contractual party regarding his transfer fee, but the forward has been found guilty in his native Brazil for tax fraud on money earned while playing for Santos.

La Liga rich list

Who earned what?

$93m

Cristiano Ronaldo: $58m salary, $35m endorsements

  • $80m Lionel Messi: $53m salary, $27m endorsements
  • $37m Neymar: $15m salary, $22m endorsements
Getty Images

The Messi and Ronaldo cases are similar. Both are accused of avoiding tax on sale of image rights by using offshore companies. However, the Portuguese was registered as a non-resident taxpayer under the Beckham Law, while the Argentine has spent his entire adult life registered in Spain.

Prosecutors accuse the Real Madrid star of evading tax of €14.7m between 2011 and 2014 via an alleged shell company called Tollin Associates, registered in the British Virgin Islands.

Spanish investigators say the company, owned by Ronaldo, is a “screen” and has no economic activity apart from having bought and then ceded the player’s image rights to a firm based in Ireland that “genuinely manages [his] rights sales”.

Prosecutors also claim that money earned from image rights was incorrectly described as capital gains, to benefit from a lower tax rate.

What is their defence?

Lionel Messi was informed by the judge in his case it was no defence to plead ignorance and argue that his father was the only person who knew how his money was being managed.

Neymar of FC Barcelona leaves the National Court on February 2, 2016 in Madrid, Spain.Image copyrightGETTY IMAGES
Image captionNeymar spent 90 minutes before a judge in Madrid in February 2016

Neymar has denied any wrongdoing and told the court investigating his case that his father and associates dealt with off-field business matters.

Cristiano Ronaldo’s representatives and legal team say the only dispute can be about quantity and that there has been no intention to commit fraud. “There is no tax evasion scheme… There has never been any hiding nor any intention to hide anything,” they say.

They argue he has paid tax to the Spanish treasury on 20% of his total image rights when, in fact, more than 90% of these are generated outside Spain as he is such a global name.

“The tax agency clearly thinks that if he is being paid for wearing certain boots, shirts or caps in Spain, then he cannot claim this money is being earned abroad,” explains Mr Cruzado.

Will any of them go to jail?

Neymar and Lionel Messi look set to be spared prison due to Spain’s unwritten two-year-sentence rule, even if Neymar is eventually found guilty.

Cristiano Ronaldo may be a different matter. Three of the four accusations of tax fraud are considered by prosecutors to be “aggravated”, so they carry a minimum sentence of two years each. Four guilty verdicts and he could face as many as seven years.

However, an investigating judge needs to ratify the prosecutors’ accusations, and that could take many months or even years.

Even if the investigating magistrate does take up the case, the Portuguese will have several options and a guilty verdict would not necessarily mean jail.

He could admit guilt, pay taxes and fines in advance and reduce any eventual jail term to a half or quarter of the statutory minimum. That way he would slip under the standard two-year bar for first-time offenders and see his sentence suspended.

Secret Mexican diary sheds light on Spanish Inquisition And Torture Of Jews

(THIS ARTICLE IS COURTESY OF THE BBC)

Secret Mexican diary sheds light on Spanish Inquisition

A close-up of one of Carvajal diaries
Image caption Luis de Carvajal used gold leaf from Bibles to decorate the diary

A story of torture, betrayal and persecution is captivating Mexicans almost 500 years after it happened.

The dramatic life and death of the Carvajal family in 16th-Century Mexico is in the spotlight after a decades-long search for a national treasure came to an unexpected happy ending.

Luis de Carvajal “The Young” came to Mexico – then known as New Spain – with his large, well-to-do family during the early colonisation of the Americas.

His family governed part of northern Mexico and soon made enemies, including a power-hungry viceroy keen to topple them from power.

The ambitious viceroy discovered that Luis de Carvajal was a practising Jew, a crime punishable by death in the times of the Spanish Inquisition

Older relatives had urged Luis de Carvajal to convert to Catholicism for his own safety, but he staunchly stuck to his faith.

Secret record

When he was first arrested, the authorities let him off with a warning but kept tabs on him.

Far from giving up his religion, Luis de Carvajal became a leader in Mexico’s underground Jewish community.

An employee holds the 16th-century manuscript by Spanish-born Jew Luis de Carvajal the Younger as it is displayed to the media at the Anthropology museum in Mexico City, Mexico March 23, 2017.Image copyrightREUTERS
Image captionLuis de Carvajal chronicled his fall from governor to being sentenced to death in his tiny handwriting

When the inquisitors caught up with him again a few years later, he was sentenced to death. He was just 30 years old.

Before he was executed, he was tortured so badly that he revealed the names of 120 fellow Jewish people, historian Alicia Gojman explains.

His captors forced him to listen as those “heretics”, which included his own mother, were tortured in the cell next to him.

“He tried to commit suicide because he couldn’t cope with having told them about his family and friends, but didn’t manage it,” says Ms Gojman.

We know the excruciating details of Luis de Carvajal’s persecution because he managed to keep secret diaries.

But these were not any old notebooks. They were painstakingly crafted, miniature manuscripts with almost microscopic handwriting in Latin and Spanish.

Some pages were intricately decorated with gold leaf he scraped from pages of a Bible.

Each of the three memoirs was no larger than a present-day iPhone, most likely so he could keep them hidden away under his hat.

An iPhone lies next to the manuscript
Image captionThe small size of the diaries meant they could be hidden easily

Luis de Carvajal wrote about being a young Jew in the New World, about exploring his heritage and practising his beliefs despite the dangers.

But much of the memoirs focus on his final tragic days before he was burned at the stake, with vivid descriptions of him falling to his knees upon hearing his mother’s tortured screams as she was pulled on the rack.

Luis de Carvajal found comfort in poetry, writing verses and prayers to reaffirm his faith in the face of so much cruelty.

Treasured artefacts

Luis de Carvajal’s memoirs are treasured by Mexico’s Jewish population as chronicles of keeping faith despite the ruthlessness of the Spanish Inquisition.

“Children who go to Jewish schools study the Carvajal family history,” says Mauricio Lulka, executive director of the Central Committee for the Jewish Community in Mexico.

A view of the manuscript.
Image captionThe history told in the diaries is taught in Jewish schools in Mexico today

For centuries, the delicate manuscripts were kept in Mexico’s National Archives. They were treasured as being among the first artefacts documenting the arrival of Jews to the Americas and were studied by researchers from around the world.

But in 1932 they vanished, leading to suspicions among the small group of academics who had access to them that one of them may have stolen the precious diaries. After all, they were small enough to hide under a hat.

With no trace of the documents, the search was eventually suspended and the trail went cold.

More than 80 years after their disappearance, the London auction house Swann in 2016 listed “replicas” of the manuscript at an initial price of $1,500 (£1,150).

But a US collector of Judaica, Leonard Milberg, was suspicious.

Why would someone go to the trouble of recreating the minuscule handwriting of Luis de Carvajal’s original to create a replica?

Intrigued, he contacted the Mexican consulate which confirmed that the originals were still missing and sent experts to check the “replicas” out.

Baltazar Brito is the director of the National Library of Anthropology and History in Mexico and one of the experts sent to assess the documents.

“When I got there, something told me they were originals, I knew it in my heart,” he says.

A man looks at the manuscripts at an exhibition
Image captionBaltazar Brito said he had a “gut feeling” the documents were originals

For Mr Brito, the documents have relevance beyond their time.

“They tell the story of religious intolerance that we shouldn’t let happen again in the world,” he says. “Despite that, it still happens.”

Leonard Milberg felt the manuscripts belonged in Mexico, so the collector made it his mission to deal with all the international agencies involved and covered the costs of sending them back.

Their safe return was welcome news for Mexico’s now thriving Jewish community of about 50,000 people, many of whom were drawn to the country by its modern-day commitment to religious freedom.

After they were briefly exhibited in Mexico City they are now safely stored in a special climate-controlled vault in the National Library of Anthropology and History in Mexico, as no one wants to risk the miniature manuscripts disappearing for another eight decades.

Related Topics

Russian Arrested In Spain ‘Over Mass Hacking’

(THIS ARTICLE IS COURTESY OF THE BBC)

Russian arrested in Spain ‘over mass hacking’

Computer keyboardImage copyright REUTERS
Image caption Much of Pyotr Levashov’s alleged activity involved ransomware

Spanish police have arrested a Russian programmer following US allegations of large-scale hacking.

Pyotr Levashov was held in Barcelona on Friday and is remanded in custody.

Spanish police said Mr Levashov controlled a botnet called Kelihos, hacking information and installing malicious software in hundreds of thousands of computers.

The arrest was part of a “complex inquiry carried out in collaboration with the FBI”, police said.

Mr Levashov is subject to a US international arrest warrant and a Spanish court will hear whether he can be extradited.

Much of his alleged activity involved ransomware – blocking a computer’s access to certain information and demanding a ransom for its release.

Mr Levashov’s wife Maria told Russian broadcaster RT that the arrest had been made in connection with allegations that Russians had hacked the US presidential election.

She said Spanish police had told her the arrest was in connection with “a virus which appears to have been created by my husband and is linked to [Donald] Trump’s victory”.

However, Agence France-Presse news agency quoted a source close to the matter in Washington as saying that Mr Levashov’s detention was “not tied to anything involving allegations of Russian interference with the US election”.

Donald Trump on the campaignImage copyright GETTY IMAGES
Image captionMr Levashov’s wife linked the arrest to claims of Russian hacking of the US election

A US intelligence report released in January alleged that Vladimir Putin had tried to help Mr Trump to victory, allegations strongly denied the Russian president.

Mr Trump later commented that the outcome of the election had not been affected.

Several cyber security experts, including Brian Krebs, have also linked Mr Levashov to a Russian spam kingpin, who uses the alias Peter Severa.