Enjoy crazy conspiracy theories? Then read on!
Everyone’s struggling to put the pieces together effectively in the fallout of Tevezcherano, but clarity can be found by looking to a couple of case studies that were constructed long before Alan Pardew wet his pants yesterday.
If you are truly interested in understanding the involvement in football of not only MSI but all of the dodgy businessmen currently investing in our fine sport, there are two sources that are simply a must-read. The first is below in full (we’ll explain in a minute) and is an article that was passed around via email to us. It’s rumored to be a translation of a case study by Voetbal International, a Dutch football publication, in 2004 and comprehensively, and compellingly strings together the many pieces of this puzzle that most of us either don’t have the time or mental capacity to.
The second article is from Play-The-Game and is a similar analysis, the two articles together at least go some way to confirming the facts and theories within them. While these studies may not be specifically regarding Tevezcherano, it certainly sheds a lot of light on the power players invovled in that deal and presumably many more in the future. They’re rather lengthy, but an incredibly interesting read if you’re into this sort of thing.
They are very, very long. Only proceed if you are some sort of academic
[Disclaimer: We can not find any mention of this article on their website (which is in Dutch) nor from searching the web. So if anyone can figure out where this piece is from please let us know, we’re not particularly fond of republishing someone else’s entire work but right now we don’t know who to attribute it to, or have a link to the original. The content below is not the property of CaughtOffside.com and we are not responsible for the views or crazy theories expressed.]
The Long Reach of ‘the Network’
Corruption, money laundering, organized crime, forbidden agreements,
cartels, tax havens and people who seem to have escaped from a James Ellroy
novel; football is now less and less about sport and more and more about
playing dirty. This dossier by the Dutch weekly magazine Voetbal
International points the finger at the new masters of international football
and raised some tough questions.
In the autumn of 2004, a 33-year-old previously obscure Iranian
businessman, Kia Joorabchian, announced he had acquired the most important
football club in Sao Paulo, Corinthians. As one of the main shareholders in
Media Sports Investments (MSI), a London-based holding company, Joorabchian
had agreed a ten year contract with Corinthians in which he agreed to make
around 28m euros available to the club, 16m of which would cover all club
debts, in exchange for 51% of all the profits made by the Corinthians
company over the period. “I want Corinthians to be like Real Madrid and
Manchester United”, declared Joorabchian on the day of the takeover, “and my
ambition is to construct a team of galacticos. Currently, nobody comes to
Brazil to invest, they only want to buy. I want to turn that trend around”.
Suddenly Corinthians seemed set for a period of glory, the team whose last
trophy of significance was in 2000 with victory in the World Club
Championship over, amongst other sides, Real Madrid. The first move of the
Iranian magnate was is the purchase of the Argentine forward Carlos Tevez
from Boca Juniors, a player who had been linked to many of the most
important clubs in Europe, for the exorbitant figure (for South America) of
$16m. But this was just the first and most important of a long series of
deals to take players to Sao Paulo. Among the others were the River Plate
midfielder Javier Mascherano (11m euros), Roger, another midfielder, this
time from Benfica (2m euros) and the Werder Bremen defender Gustavo Nery
(1.5m euros).
But who is this person who appeared from nowhere and who immediately opened
his chequebook with almost excessive generosity? This is Joorabchian’s
answer. “Initially I was interested in the purchase of Arsenal, but the
price was much too high. I therefore decided to invest in Brazil because I
have many friends in the country, and getting passionate about their
football is very easy indeed”. A great friend of Joorabchian is Renato
Duprat, who acts as an intermediary for MSI but does not enjoy good
reputation in Brazil due to an ugly history tied to the failure of a
hospital and a health insurance company, both of which he had headed. But
the doubts about the new owners of Corinthians did not get in the way of the
deal being done. Interestingly, research at the British Bar Council
suggests that, respectively, all the following individuals exist: Kia
Kiavash, born on 25 July 1971 and of Canadian nationality, Kiavasch
Joorabchian, born on 14 July 1971 with both English and Canadian
nationality, and finally a Kia Joorabchian, born on 14 July 1971 and of
English nationality. Two names, two addresses, two dates of birth. Nothing
is clear about this individual who was born in Iran but grew up in England
after fleeing his homeland in 1979 when the Shah was toppled by Ayatollah
Khomeini and who was then educated at the Shiplake College in Henley and
then at Queen Mary College.
In Russia, Joorabchian’s name became known after 1998 when, by means of a
company called American Capitol based in the tax haven of the British Virgin
Islands, he bought 85% of the Kommersant daily newspaper. The paper’s fair
market value was around $20m, but (after providing assurances to the
director Ralf Shakirov that he would not do so) he quickly sold it on
cheaply to the Russian magnate Boris Berezovsky, one of infamous oligarchs
who controlled the TV channels and a large section of the Russian media and
constituted the ‘shadow government’ of the last years of Yeltsin. In spite
of the declarations from Joorabchian, that he had no idea he was selling the
newspaper to the Russian billionaire, the local press were sure that the
Iranian was simply acting as Berezovsky’s proxy (a Brazilian newspaper
published the text of an intercepted telephone call from Corinthians
president Alberto Dualib, in which he mentioned that he had spent a weekend
in London with Joorabchian and of having visited Berezovsky’s house). For
these oligarchs, however, trouble was on its way from a former KGB agent who
had decided to target those businessmen who became super rich following the
collapse of communism. His name was Vladimir Putin, Boris Yeltsin’s
successor in the Kremlin. The new Russian president soon assumed control of
media and mobilized the judiciary; one of the oligarchs, Mikhail
Khodorovsky, was arrested and others were forced to escape. Berezovsky was
accused of arms trafficking in Chechnya, tax evasion and fraud. In 2001 the
magnate escaped to London, where in 2003 he was granted political asylum.
Soon after a fellow oligarch arrived in the English capital, Roman
Abramovich. He was another who had hugely benefited from the chaos of the
post-Soviet transition and by the age of 34 years-old was the owner of the
colossal Sibneft energy group with a personal fortune of $13bn, as well as
being the governor of Chukotka – elected with 92% of the votes – and as such
a member of parliament. In June 2003 Abramovich, despite never before being
interested in football purchased Chelsea for 180m euros.
Soon after Joorabchian’s takeover of Corinthians, MSI began attracting the
attentions of the Brazilian and Argentine authorities. Doubts and concerns
also stemmed from the Brazilian Central Bank and from GAECO (Grupo de
Atuação Especial de Repressão ao Crime Organizado), the special agency that
fights against organized crime. There was one question: where does MSI’s
money come from? On 8 December 2004 the court in Sao Paulo opened an inquiry
on the relationship between MSI and Corinthians; Kia Joorabchian was
interrogated for over three hours. “We have a big problem in understanding
from where the money comes and who is the investor”, stated the press
release from the chief investigator, Josè Reinaldo Carneiro, “even if it
seems that the money is coming from the former Soviet Union”. Romeu Tuma,
former Interpol agent and currently member of the Brazilian Socialist Party,
notes something else significant: “When it was founded in August 2004 in the
Virgin Islands, Media Sports Investments had just £100 in capital then just
after the Corinthians deal, two lawyers from Sao Paulo transferred 30m euros
from MSI to the football club. It is natural that questions should follow
from that”. A number of other companies connected to MSI have been
identified, three based in the Virgin Islands (Just Sport, GGAW and Devetia)
and one in Gibraltar (Global Sport Agency Ltd). Connections between
Joorabchian, MSI and Berezovsky are not hard to find either. The first $2m
of the fee to Boca Juniors for Tevez was in fact received from a certain
Zaza Toidze of Tbilisi, Georgia. It turns out that Toidze is a lawyer for
businessman Badri Patarkatsishvili, long time friend of Berezovsky as well
as president of Dynamo Tbilisi since 2001. The coincidences do not stop
there and the sight of Abramovich’s luxury yacht berthed in the port of
Buenos Aires led to a series of speculations in the Brazilian media
suggesting a meeting between Abramovich and the president of Boca Juniors
Macrì the day before the sale of Tevez to Corinthians. It was also noticed
that the Tevez deal has been managed by FIFA agent Fernando Hidalgo, agent
for amongst others Veròn and Crespo and someone with a very good
relationship with another key person in this merry go round, the Israeli
Pini Zahavi, right hand man of Roman Abramovich at Chelsea.
Chelsea, Dynamo Moscow and PSV Eindhoven, the European connection. Strong
suspicions existed that Abramovich and Zahavi had an important role in the
Corinthians transfers concluded by Joorabchian. The report presented by the
attorney Carneiro revealed the financial details of these operations. It
emerges that MSI owns just 35% of Tevez’s licence (the remaining 65% is the
property of another company, Just Sport Limited), 100% of Dominguez
Sebastian’s licence (acquired by Corinthians from Newell’ s Old Boys) and
50% of Brazilian forward Carlos Alberto’s licence, bought to Brazil from
Porto for 6.8m euros (the remainder is owned by Global Soccer Agencies).
Another company connected to these, Devetia Ltd, owns 100% of Marcello
Matto’s licence, the umpteenth purchase by Joorabchian, bought from Sao
Caetano for little more than 1m euros. As noted above, three of these four
companies (MSI, Just Sport and Devetia) are based in the Virgin Islands,
while the last one, GSA (Global Soccer Agencies), is based in Gibraltar,
even though its legal headquarters is in Israel. With many assets in
Portugal, GSA has also been involved in a series of transfers in the last
two seasons between the Portuguese league and Dynamo Moscow; Danny (Sporting
Lisbon), Frechaut (Boavista), Jorge Ribeiro (Gil Vicente), Cicero and Luis
Lourenco (both of Sporting Braga), Nuno Assis (Guimaraes), Thiago, Derlei,
Maniche, Costinha and Seitaridis (all from Porto), a total of eleven players
moved from one league to this single club in just two years, and for a total
of approximately 45m euros. To these transfers can be added the deals to
take Roger from Benfica to Corinthians and Jankauskas from Porto to Nizza,
both supposedly facilitated by Global Soccer Investments. “But the idea that
these deals are somehow different is ridiculous as the people in charge of
the two companies are the same”, commented a Portuguese FIFA agent who
preferred to remain anonymous.
So who are the directors of GSA? “Their names are Jorge Mendes and Pini
Zahavi”. Joorabchian-MSI-GSA-Mendes/Zahavi-Abramovich; the circle seems
complete. Jorge Mendes, as well as being a FIFA Agent, is also the agent the
Chelsea manager Josè Mourinho and the man who delivered Ricardo Carvalho,
Tiago Mendes, Paulo Ferriera and Nuno Morais to the Blues. Zahavi, on the
other hand, is the spider that weaves Roman Abramovich’s web. The English
media call him ‘Mr Fixit’. Formerly a journalist, he is currently a key
player in English football although he does not even possess an agent’s
licence. Zahavi was the man who introduced English football to Abramovich,
putting him in contact with directors from Manchester United (with which the
Israeli businessman has excellent relations having played a prominent role
in the transfer of Rio Ferdinand to the Red Devils) and with the penniless
Chelsea chairman Ken Bates, prior to the Russian revolution that exploded in
July 2003. One of the biggest Zahavi signings for Chelsea was the
acquisition of the Manchester United Chief Executive Peter Kenyon.
Meanwhile, in Europe, initial contacts have led to serious negotiations
(starting in June 2004) between GSA and Jan Raniecky, the president of
Polonia Warsaw, for the purchase of the Polish club. The net of the two main
companies, MSI and GSA, is widening and they are continually looking for new
affiliates – preferably in somewhat difficult situations. Due to CSKA
Moscow’s sponsor being the Abramovich-owned Sibneft, UEFA has opened an
inquiry as the international regulations clearly prohibit the participation
in the same tournament (in this case the Champions League) of clubs with one
owner. In the case of CSKA the strong suspicion is that the sponsorship is
only a cover for de facto ownership. In the transfer market, CSKA has
previously purchased the Brazilian forward Vagner Love from Palmeiras (for
9m euros, with MSI as the intermediary), but who is now in the process of
moving to Corinthians, and also the Czech midfielder Jiri Jarosik who
Chelsea are eyeing. The names involved are always the same.
Another club with close relations with the clubs of the ‘network’ is PSV
Eindhoven, who, in the summer of 2004 announced the purchase of the strong
Santos defender Alex. The details of the deal have never been made public by
the club, but the Dutch press has stated that the club did not pay a single
cent of the 8m euros fee which Santos received and that Alex is only in
Holland ‘to mature’ before leaving for his real club, Chelsea. A prominent
role was played in the Alex deal by Brazilian FIFA Agent Giuliano
Bertolucci, according to the Brazilian press one of the famous (or should we
say infamous) ‘green and gold’ friends of Joorabchian. The contacts between
the PSV and Bertolucci are limited to the Alex deal. In summer 2004 the FIFA
agent had accompanied the Dutch manager Guus Hiddink on his visit to South
America to search for young talent to bring to Europe. In the midst of this
Carlos Tevez, came onto the market and was fought over by three clubs. Their
names are easy to guess – they were Chelsea, Corinthians and Porto, and it
is perhaps it is only necessary to say “the clubs of the MSI ‘network'”. Is
that all? No, because following an investigation carried out by the
Eindhoven’s Dagblad newspaper it turns out that the PSV talent scout Piet de
Visser is not solely employed by the Philips club, but also works for…
Chelsea, in the capacity of personal advisor for Abramovich on the transfer
market. The conduct and status of De Visser at PSV cannot be criticized as
nothing appears to stop him working for more than one club. But the
transfers do not always go in the hoped for direction, and this is the case
for the Brazilian starlet Robinho, one of De Visser’s favourite players; in
Holland much was said about his imminent passage to PSV Eindhoven. To that
end Bertolucci and Vlado Lemic (he who oversaw the switch of Mateja Kezman
from PSV to Chelsea) had put 10m euros on the table of a surprised Wagner
Ribeiro (who is Robinho’s agent). This was the same figure that was offered
soon after by Benfica – another club in the orbit of GSA. It all ended up
with the Brazilian travelling to Europe in 2005 but to Real Madrid. But
other international footballers see the logic of moving to a club in ‘the
network’. To build a working relationship with this the cartel of clubs
offers a great advantage for a club like PSV Eindhoven, in the sense that it
provides access to the immense and perennially healthy South American market
through privileged channels and by allowing the import of talented players
who are not yet ready to play at the top level. The purchase of Alex is a
typical example of this way things operate. The Brazilian defender was
disastrous for the first few months but he has gradually acquired greater
urgency and experience, and now he appears ready to make the big step up.
This is a key factor for each of the other clubs involved with ‘the network’
or those that wish to join, like Benfica, Hapoel Tel Aviv, Deportivo La
Coruna, Compostela and Polonia Warsaw.
So what is the secret objective of this strategy? Are Abramovich and
Berezovsky so in love with football that they want to own one club in each
country? Only someone who has operated on the inside of ‘ the network’ can
provide an answer which approaches the truth, and Voetbal International has
an informant with this insight. Because he obviously does not want his
identity revealed he shall be known only as Mr X. “For the so-called
‘network’ I was involved in the transfer of capital from one country to
another and of the management of huge amounts of money. Naturally what I was
doing had nothing to do with football. It was a matter of transactions, just
transactions”. What was the scope of that? “They want to control the market.
Their actions are not based on sporting logic, the championship, the club,
the fans and however many others; they simply see a potentially healthy
market in front of them, and they want to take advantage of it as much as
they can. They want to become the first football multinational, just like
Sony is in the world of electronics; with one branch in each territory”. The
lyrics of the song ‘Complete Control’, sung by the Clash almost thirty years
ago are still relevant; they referred to the music business but now
multinationals are in every field of our daily life.
And in football, this is not the first time that cases of allegedly unlawful
collaboration between two or more international club have been seen. One
could cite connections between Paris Saint-Germain and Servette, Udinese and
De Graafschap, or between Parmalat and various South American clubs (it
would be a struggle here to make a convincing case as to their legality of
the arrangements). But according to Mr X, things are not comparable,
because the ‘network’ of companies is moving ten times the amount of money
compared to previous cases: “These are not people with hundreds of millions,
they have tens of billions, and using that money in the market means that
you can indeed try to control it. The South American market, and Brazil in
particular, provides a practically inexhaustible supply of talents – every
day a new Pel̬ seems to be born. And Brazil is like a jungle Рthe
strongest, or in other words, the richest, always seem to get their way. In
Holland, a player can more or less decide where he wants to play, but in
Brazil this isn’t possible. The agents buy the players’ licences from the
clubs when they are still in the youth teams and they often acquire them in
blocks, one to two hundred at a time. Then basically, they manage them how
they want to. This is normally a good investment for the agent because out
of two hundred players someone with real talent will usually come through.
What it means is that from a young age players are simply not master of
their own destiny.”
For Juan Figer, the uncontested king of the Brazilian transfer market, with
a fortune of over $600m earned over course of the years through the signing,
development and subsequent sale of football players, the game is both simple
and extremely profitable. ‘”The real money that agents make is not through
the commission they earn through the transfer of a player. Instead it is
through the exploitation of the player’s image rights”. For eight hundred
dollars it is possible to set-up a company in the Virgin Islands, which can
then manage the image rights for 400-500 players. Compare the profit gained
between the commission received for one transfer and the exploitation of
these rights – how many times does a player changes clubs in his career?
Three, four, six times? The agent pockets 5 to 10% of the value of every
completed deal. The image rights deals instead last for thirteen, fifteen
years and, what’s more, no tax is paid on this income”. Can you provide a
more detailed explanation? “For example, a large amount of this money comes
from the overpaid players in the Spanish Liga. Their image rights are often
managed by an off-shore company based in Holland or a tax haven. This might
seem like fantasy land but it is not at all. In the Low Countries a company
exists which manages the image rights for many of the most important players
in La Liga. Let’s take Ronaldo as an example who earns roughly 10m euros a
year. Of this figure, 70% of the income is made up from the revenues from
the player’s image rights and the remaining 30% is from the wages received
from Real Madrid. Ronaldo happily pays taxes on the 3m euros, while the
remaining 7m euros come transferred via Hungary where it sits for twelve
hours before moving to Holland, where it remains for another twelve hours
before ending up in some tax haven. Why Hungary and Holland? Because
between Spain and Hungary and between Hungary and Holland there are fiscal
agreements in place. Then, once the money reaches its vault in one of these
Caribbean Islands where no one asks questions, the financial company and the
agent in question are left to manage 7m clean euros. The football player
clearly has nothing to do with these arrangements. They tend to limit
themselves solely to discussing with the agent just how much they want to
earn from their image rights. The rest ends up in the pocket of those who
manage this money year after year.”
In today’s world, those who manage large amounts of money do not have great
difficulty in finding people in authority who look the other way and banks
who do not ask questions, because, as they say, money talks. The Brazilian
investigation of Joorabchian, Corinthians and MSI has now run aground over
issues of territorial jurisdiction and it really could not be any other way.
The Virgin Islands are definitively off-limits. Josè Reinaldo Carneiro, the
attorney in charge of the investigations, has drawn some conclusions but is
reticent about revealing all of them: ‘”Various evidence suggests that this
enormous flow of money originates from drug and arms trafficking by the
Russian Mafia. The ties between MSI and a certain person who in his own
country has been sentenced to twenty years of jail for fraud, supporting
terrorism and several other crimes (clearly a reference to Boris Berezovsky)
have been more than sufficiently demonstrated”. Romeu Truma adds: “In one
way or another the Russian dirty money is going to find its way home. What
better way than to make it happen through the football business? There are
few controls and the recycling can be carried out without too may risks”.
Therefore it seems, rather than laundries and casinos, organized crime is
now using football clubs to recycle their dirty money. Given the economic
crisis that currently envelopes the world of football, reading the figures
paid by certain clubs for the purchase of certain players legitimately
raises a few doubts. Look at Chelsea: 30m euros for Ricardo Carvalho, 20m
for Paulo Ferreira, 12m for Mateja Kezman, whose contract with PSV was due
to expire the next year, then the following year 30m euros for Shaun
Wright-Phillips and almost 38m euros for Michael Essien. Money spent
casually with no concern for the resulting financial loss. This is the
opinion of Tom Cannon, director of the Manchester Business School:
“Considering the total investment from Abramovich over this period (£250m)
Chelsea needs to make record profits for the next 25 years”. The money spent
could therefore have some other purpose. Conclusion. The latest update of
these events at the end of August 2004 has seen UEFA report that they have
received information regarding the activities of this ever-growing cartel.
However, for now, because of the lack of definite evidence, no inquiry has
started. Joorabchian, meanwhile, has tried to secure a bridgehead in the
Premier League via the purchase of West Ham, but the deal has not yet been
concluded. For now FIFA and UEFA wait for events to unfold but the hope is
that they will find the time than to ask themselves, as Voetbal
International has, if the world of football has indeed becoming a playground
for fugitive billionaires eager to plough their dubious fortunes into the
transfer market.