Barcelona's Javier Mascherano charged with tax fraud in Spain
Barcelona star Javier Mascherano was charged with two counts of defrauding the Spanish tax authorities of a total of more than €1.5 million, Spain's public prosecutor said on Monday.
Mascherano, who joined Barcelona from English club Liverpool in August 2010, is alleged to have sought to conceal earnings from his image rights by using companies set up in the United States and Portugal, the prosecutor's office said.
The 31-year-old is accused of defrauding the authorities of €587,822.01 in 2011 and €968,907.76 in 2012.
The Argentina star made no immediate public comment on the charges, which were reported last week. This month he paid the back-taxes owed plus almost €200,000 in interest, the office said, and local media reported this could work in his favour if he is found guilty.
Mascherano opted to pay the back taxes and the fine based on his legal counsel's advice but was not able to avoid the tax fraud complaint, despite the fact that the state cannot seek more restitution and can only possibly request a minimum punishment. The source said the state will likely ask Mascherano to enter a guilty plea.
The agency opened an investigation into Mascherano's taxes shortly after a Portuguese TV station claimed that the player had avoided paying taxes in Madeira's duty free zone.
A Spanish judge must now rule on whether the Mascherano case should go to trial.
The probe revealed that the fraud had been committed in two tax communities -- Madeira and Miami -- both of them created while the player was with Liverpool and maintained once he moved to Barcelona. The unpaid taxes were €587,822 in 2011 and €968,907 in 2012, according to the report.
The case is similar to that of Mascherano's Barcelona and Argentina teammate, Lionel Messi, who is to stand trial over allegations that he benefited from the network of companies which were established to deal with his financial affairs, leading to the evasion of €4.1 million in taxes between 2007 and 2009.
If found guilty, both Messi and his father could be fined up to €21m and receive a one-year suspended prison sentence.
The Spanish government has recently been cracking down particularly hard on tax evasion amid the country's continuing economic woes, with Messi one of a number of high-profile targets against whom cases have been opened.
La Liga clubs and players have long used "image rights" to avoid paying higher income tax rates, while the Spanish authorities have regularly found this approach to be illegal, with current Barcelona coach Luis Enrique among those who have previously made a settlement.
According to El Pais, Spain considers Madeira a tax haven and investigated a business Mascherano incorporated there in 2010 called Anadyr Overseas, to which Mascherano sold his image rights for €5m.
Spain's tax law allows a player to sell up to 15 percent of his image rights to a company, image rights which Barcelona began to pay to Anadyr Overseas, but Hacienda claimed that Mascherano did not pay, despite the fact that he had established residency in Spain.
The report also said that Spain is charging Mascherano for failing to pay taxes on image rights from Nike via Lofer, a company he established out of Miami. More than one third of the back taxes were related to the Lofer income.