2004–2010 Italian football scandal

The 2004–10 Italian football scandal also known as Caso Plusvalenze[1] was a football scandal over alleged false accounting at Italian football clubs in the 2000s. The investigation started in 2004, and the last sentencing occurred in 2010.

Backgrounds

In the early 2000s, many Italian football clubs went bankrupt due to benefactors withdrawing financial support. The search for profit seemed to have pushed the game into the background, and from the law enforcement investigations, a widespread culture of illegality had emerged. These football clubs included AC Fiorentina (2002), Monza (2004), S.S.C. Napoli (2004), Ancona Calcio (2004), AC Torino (2005), AC Perugia (2005), Como (2005), Reggiana (2005), Salernitana Sport (2005) and A.C. Venezia (2005). In addition, Parma went into administration and was re-founded as Parma Football Club S.p.A. (2004).

Previously, some of these clubs made money by cross-trading players using the football transfer market. This was a system whereby two or more players switched clubs, with or without exchanging money . This practice typically resulted in short-term financial benefit for the club, but in the long term it increased expenditure through 'amortization,' or the depreciation of players' financial value. In February 2003, a law was passed which allowed clubs to defer amortization expenses Articolo 18-bis Legge 91/1981, allowing clubs to avoid recapitalization through negative equity. Despite the law, many clubs continued to practice cross-trading in order to raise the short-term profit required to meet financial criteria for the 2003–04 season. The law was declared unconstitutional in 2005, causing some clubs to recapitalize and remove their amortization fund on or before 30 June 2007. Thus, the clubs had to overcome yet another capital shortfall, which later created controversy when reevaluating their brand and mortgaging to the banks.

Other scandals also involved inaccurate dating of profits obtained via the transfer of players. For example, Roma sold their Japanese international midfielder Hidetoshi Nakata for 55,000 million lire in July 2001, but the club documented the profit in their accounts for the 2000–01 season,[2] claiming the deal was agreed to before the cut-off of the financial year, 30 June 2001.

Cross-trading deals were prevalent before 2003, when the injustices came to light. Examples include the deals involving Giuseppe Colucci and Alberto Maria Fontana (Roma–Verona, 12.5 billion lire); an exchange that involved Amedeo Mangone, Paolo Poggi and Sergei Gurenko for Diego Fuser, Raffaele Longo and Saliou Lassissi (Roma–Parma, 65 billion lire).

Other deals linked to this scandal included those of Matuzalém (Parma–Napoli, 14 billion lire); Manuele Blasi and Giuseppe Cattivera (Roma–Perugia, 18 billion lire); Paolo Ginestra and Matteo Bogani (Milan–Inter); Giammarco Frezza and Alessandro Frau (Inter–Roma, 8.8 billion lire) in 2001; Vratislav Greško and Matías Almeyda (Inter–Parma, €16M); Luigi Sartor and Sebastiano Siviglia (Parma-Roma, around €9M); Francesco Coco and Clarence Seedorf (Milan–Inter, €29M); Davide Bombardini and Franco Brienza (Palermo–Roma, 50% €5.5M); Gabriele Paoletti and Luigi Panarelli for Fontana–Frezza (Torino–Roma, 50% €10.5M) in 2002; and Rubén Maldonado and Gonzalo Martínez in January 2003.

In a broad sense, the scandal was a culmination of the period that the Italian media dubbed doping amministrativo[3] (doping[-like] administration), bilanciopoli (balance sheet scandal), plusvalenze fittizie or plusvalenze fai-da-te (DIY profit).[4] The Bologna president, Giuseppe Gazzoni Frascara, proclaimed his innocence and reported false accounting to the FIGC.[2] Bologna, however, were also involved in cross-trading, such as the remaining 50% of the fee for Jonatan Binotto (10 billion lire) from Juventus for Giacomo Cipriani, Alessandro Gamberini and Alex Pederzoli in 2000, and Binotto to Internazionale for Fabio Macellari in 2001.

The trading

As FIGC was unable to prove that the football clubs intended to 'flop' the price of mature footballers, only deals involving youth players were punished.

Players received Fee
June 2003
Milan [5] Chiveo
Martino Olivetti (50%) + €0.1M Paolo Sammarco (50%) €1.1M[6]
Milan [5] Internazionale [5]
Matteo Deinite (50%) + €0.25M Salvatore Ferraro (50%) €1.75M[6]
Matteo Giordano (50%) + €0.225M Alessandro Livi (50%) €1.725M[6]
Ronny Diuk Toma (50%) + €0.25M Giuseppe Ticli (50%) €1.75M[6]
Simone Brunelli (50%) + €0.25M Marco Varaldi (50%) €1.75M[6]
Milan [5] Parma
Roberto Massaro (50%) Marco Donadel (50%) €2M[6]
Filippo Porcari (50%) Mirko Stefani (50%) €1M[6]
Luca Ferretti (50%) Davide Favaro (50%) €1M[6]
Milan [5] Sampdoria [5] Fee
Ikechukwu Kalu (50%) + €1M cash Luca Antonini (50%) €2M[6]
Torino Ternana
Emanuele Calaiò (redeem 50%) Alessandro Cibocchi (redeem 50%)
July 2003
Reggina Udinese
Gonzalo Martínez (50%) Alessandro Pierini
Andrea Sottil (50%)
January 2004
Genoa [7] Udinese [7]
Mohammed Gargo (50%) Valon Behrami (50%)
Vittorio Micolucci (50%) Rodrigue Boisfer (50%)

The investigation

In 2004, Roma and Lazio were investigated for false accounting.[8] Soon followed by Milan and Internazionale.[9]

However, in another line, the liquidator of Como pointed out it's failure to Preziosi. The accusation suggested that the owner had transferred the asset of Como to Genoa at an uneconomical price, whilst the liquidator of Fiorentina had found that the date of player profit and cross-trading were wrong in the balance sheet.[10] The failure of Perugia was also under investigation.[11] The fall of Spezia Calcio was also linked to it's previous owner Internazionale.

Moreover, a separate charge related to Brunelli's was exposed in 2007. Brunelli claimed the signature on the transfer document was not his and that he knew nothing when transferred from Milan to Internazionale. Brunelli was banned for two months from football, although he was retired at the time . Brunelli's agent was charged and dismissed. Brunelli sued Internazionale for negligence and forcing him to retire. This was also dismissed.[12] Lazio[2] were acquitted in 2007 as well as Juventus.[13] Roma were fined by the court of Rome.[2]

In January 2007, the prosecutor exposed the alleged false account of Crespo (cash-plus player swap) and Domenico Morfeo (failure of Fiorentina)[14] and an ongoing investigation of Parma,[15] as Amauri was signed by Parma from Napoli as a free agent but a massive agent fee was also paid. Amauri did not have EU citizenship and Italian clubs were commonly buying the non-EU registration quota from other clubs.

While the club sold the brand to their subsidiaries and mortgaged them, such as Inter Milan on "Inter Brand", A.C. Milan on "Milan Entertainment", A.S. Roma on "Soccer S.A.S. di Brand Management", "S.S. Lazio Marketing & Communication S.p.A.",[4] the moves was attracted Guardia di Finanza to visit Co.Vi.Soc. of Italian Football Federation to collect information.[16] However, no further action was taken.

Financial Crimes

The financial crimes committed by the Italians were grouped into three sub-categories. Fraudulent bankruptcy was a major crime committed whereby rich Italians would illegally try and hide their assets through the purchase of football teams. Money laundering was also a massive crime during this time. Owners of football clubs in Italy would hide large reserves of black money. Illegal betting was arguably the biggest problem during this period in Italian football. Matches were pre-determined to allow both gamblers and bookmakers to make maximum illegal profit.[17]

Sporting Sentences

The following punishments were given to individuals:[5]

AC Milan[5]
Internazionale[5]
Sampdoria[5]
Genoa[7][18][19][20]
Reggina[7]
Udinese[7]
Chievo[21][22]
Palermo
Ternana

Caso Como–Genoa

Aftermath

Franco Brianza- Football Player

Sampdoria denied any wrongdoing in the Kalu–Antonini transfer.[25] Zamparini, the president of Palermo, insisted the fine was heavy, as the cross-trading was under previous ownership (Sensi). The club just chose to defer to amortize the €10 million transfer fee of Franco Brienza (like every other club on flopped signing prior to 2002), instead of write-down €10 million immediately in order to reflect in the 2002–03 financial year.[26]

Failure to recapitalize and balance sheet related scandals still occurred, namely Treviso, S.S.C. Venezia,[27] Gallipoli[28] Acireale, Pergocrema,[29] and board members of the clubs were given heavy fines.

Some research had also stated the effectiveness of indicator by Covisoc to determine the financial health of the football club.[30]

See also

References

  1. ↑ "Caso Plusvalenze, deferite Genoa, Udinese e Reggina". La Gazzetta dello Sport (in Italian). 12 June 2008. Retrieved 22 August 2016.
  2. 1 2 3 4 "Doping amministrativo Roma colpevole, Lazio no" (in Italian). 10 October 2007. Retrieved 24 April 2013.
  3. ↑ "A caccia del doping amministrativo tra plusvalenze e tasse non pagate". la Repubblica (in Italian). 27 February 2004. Retrieved 24 April 2013.
  4. 1 2 "Il "doping" nei conti dei big del pallone perdite complessive oltre i 68 milioni". la Repubblica (in Italian). 9 November 2006. Retrieved 15 April 2013.
  5. 1 2 3 4 5 6 7 8 9 10 "COMUNICATO STAMPA" (PDF) (in Italian). FIGC. 12 June 2008. Retrieved 26 January 2010.
  6. 1 2 3 4 5 6 7 8 9 A.C. Milan S.p.A. bilancio (financial report and accounts) on 30 June 2003 (in Italian)
  7. 1 2 3 4 5 "Deferimenti:archiviazione per Genoa, Udinese e Reggina" (in Italian). FIGC. 18 June 2008. Retrieved 24 April 2013.
  8. ↑ "Sensi investigation rocks Roma". The Independent.
  9. ↑ "Calcio, doping amministrativo indagate anche Milan e Inter". la Repubblica (in Italian). 30 December 2004. Retrieved 24 April 2013.
  10. ↑ "PROCURA DELLA REPUBBLICA PRESSO IL TRIBUNALE DI FIRENZE" (PDF) (in Italian). Re-published by Fiorentina's fans site. 4 February 2003. Archived from the original (PDF) on 6 April 2003. Retrieved 17 November 2016.
  11. ↑ "C.U. N°24/CDN (2012–13)" (PDF) (in Italian). FIGC CDN. 28 September 2012. Retrieved 17 November 2016.
  12. ↑ "Caso-Brunelli Il Tribunale assolve l' Inter". Corriere della Sera (in Italian). 30 May 2007. Retrieved 26 January 2010.
  13. ↑ "Moggi was cleared in a false accounting case". Four Four Two. 24 November 2009. Retrieved 24 April 2013.
  14. ↑ "Crespo-Morfeo, indagine sui contratti" (in Italian). La Gazzetta dello Sport. 2007-01-26. Retrieved 2010-01-26.
  15. ↑ "Caso Parmalat, Laguardia: "Amauri credeva di essere del Napoli, e non di proprietà del Parma"". Calciomercato.com (in Italian). (Archived by www.areanapoli.it). 9 February 2010. Archived from the original on 9 February 2010. Retrieved 5 May 2010.
  16. ↑ "Cessione del marchio La Guardia di Finanza fa visita alla Covisoc". Corriere della Sera (in Italian). 31 January 2007. Retrieved 21 January 2016.
  17. ↑ http://fh6xn3yd3x.search.serialssolutions.com/?ctx_ver=Z39.88-2004&ctx_enc=info%3Aofi%2Fenc%3AUTF-8&rfr_id=info%3Asid%2Fsummon.serialssolutions.com&rft_val_fmt=info%3Aofi%2Ffmt%3Akev%3Amtx%3Ajournal&rft.genre=article&rft.atitle=Fair+play%3F+Not+so+much%3A+Corruption+in+the+Italian+football&rft.jtitle=Trends+in+Organized+Crime&rft.au=Anna+Di+Ronco&rft.au=Anita+Lavorgna&rft.date=2015-09-01&rft.pub=Springer+Science+%26+Business+Media&rft.issn=1084-4791&rft.eissn=1936-4830&rft.volume=18&rft.issue=3&rft.spage=176&rft_id=info:doi/10.1007%2Fs12117-014-9233-9&rft.externalDocID=3774589931&paramdict=en-US
  18. ↑ Three Serie A clubs fined for false accounting
  19. ↑ "Comunicato Ufficiale (C.U.) N°66/CDN (2007–08)" (PDF) (in Italian). Italian Football Federation (FIGC) Commissione Disciplinare Nazionale (CDN). 18 June 2008. Retrieved 10 August 2011.
  20. ↑ "Udine, indagati Pozzo e Pierpaolo Marino" (in Italian). Tutto Mercato Web. 31 July 2008. Retrieved 10 August 2011.
  21. ↑ http://www.tuttomercatoweb.com/?action=read&id=112848
  22. ↑ "C.U. N°3/CDN (2008–09)" (PDF) (in Italian). FIGC CDN. 10 July 2008. Retrieved 17 November 2016.
  23. ↑ "C.U. N°91/CDN (2009–10)" (PDF) (in Italian). FIGC CDN. 9 June 2010. Retrieved 17 November 2016.
  24. ↑ "Comunicato ufficiale no. 379" (pdf). Lega Calcio (in Italian). 11 June 2007. Retrieved 25 May 2011.
  25. ↑ "Comunicato stampa: chiusa la vicenda plusvalenze" (in Italian). UC Sampdoria. 12 June 2008. Retrieved 24 April 2013.
  26. ↑ "Zamparini e Foschi inibiti". La Gazzetta dello Sport (in Italian). 9 June 2010. Retrieved 24 April 2013.
  27. ↑ http://www.figc.it/Assets/contentresources_2/ContenutoGenerico/87.$plit/C_2_ContenutoGenerico_28197_StrilloComunicatoUfficiale_lstAllegati_Allegato_0_upfAllegato.pdf
  28. ↑ http://www.figc.it/Assets/contentresources_2/ContenutoGenerico/73.$plit/C_2_ContenutoGenerico_29965_StrilloComunicatoUfficiale_lstAllegati_Allegato_0_upfAllegato.pdf
  29. ↑ http://www.figc.it/Assets/contentresources_2/ContenutoGenerico/20.$plit/C_2_ContenutoGenerico_35345_StrilloComunicatoUfficiale_lstAllegati_Allegato_0_upfAllegato.pdf
  30. ↑ http://www.rdes.it/RDES_3_11_Zoccali.pdf
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