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Jun 13, 2013

Barca chiefs say Lionel Messi paid taxes

BARCELONA, Spain -- Barcelona's current and former presidents are setting aside their differences and defending Lionel Messi against allegations of tax fraud, a case that experts say could carry a prison sentence for the Argentina star.

A Spanish state prosecutor filed a fraud complaint on Wednesday alleging that Messi and his father Jorge avoided paying 4 million euros ($5.3 million) in back taxes from 2006-2009 through illegal overseas tax havens.

Joan Laporta, who was club president during the period covered by the complaint, said he is "convinced that neither Leo nor his father have committed any infraction."

Speaking separately, current president Sandro Rosell said the club has no "doubts about (Messi's) innocence."

Rosell and Laporta have been bitter rivals since Rosell left Laporta's board in 2005.

"The situation could be that they don't have any responsibility in these events." Laporta told Cope radio. "There can be third parties who are responsible.

"I know them and they have always wanted to act within the law, and that's how they acted with the club, at least when I was president."

Laporta said that Messi and his family lacked the financial know-how necessary to have set up the network of shell companies and tax havens in countries including Belize and Uruguay described in the prosecutor's complaint.

"They were always careful, let's say even wary, when faced with these situations that were over their heads because they didn't have the knowledge of a lawyer or a tax expert, and so they went out and got advisers," he said.

Messi has denied any wrongdoing and his lawyers issued a statement on Thursday saying that he "has always punctually attended to his fiscal obligations."

Spain's Sports Minister, Jose Wert, asked for "patience" given the long legal process likely ahead.

"(The law) is the same for everyone," he said. "Even for the No. 1."

The case was submitted at the court in Gava, near the Mediterranean coastal town where Messi lives. A judge at the court must accept the prosecutor's complaint before charges can be brought against Messi and his father. A court official told The Associated Press that a decision should come in a matter of days.

If found guilty and barring an out-of-court deal with the tax office, Messi and his father could face 2-6 years in jail, according to Professor Sandalio Gomez, a sports finance analyst at the IESE Business School.

In the complaint, state prosecutor Raquel Amado alleges that from 2006-09 Messi "obtained significant revenue derived from the transfer to third parties of his image rights, income which should have been taxed."

Gomez told the AP that the prosecutor's complaint appeared to be strong, while noting that hiring or establishing a company -- even overseas -- to manage players' image rights was legal as long as they met their tax burdens in Spain.

"(The complaint) is well argued," he said, adding that it reminded him of the investigation of Inaki Urdangarin, the son-in-law of Spain's King Juan Carlos who is under investigation for possible tax fraud and money laundering.

Laporta, who was Barcelona's president from 2003-10 and is considering running again in 2016 after his foray into politics, said that under his mandate Messi directly controlled 100 percent of earnings from his image rights.

But, Laporta said, Barcelona did follow a common practice of paying 15 percent of Messi's salary to a company that controlled his image rights. He said that he didn't remember where that company was based.

"If it was a company based outside Spain it would have been a registered company and in that sense a lawful company," Laporta said.

Messi is not the first athlete to be investigated in Spain for taxes.

Last year former Portugal star Luis Figo was forced to pay 2.45 million euros in income tax pertaining to image rights from 1997-99 while playing for Barcelona. In 2009, former top-ranked women's player Arantxa Sanchez-Vicario had to pay millions in back taxes.

The 25-year-old Messi is widely considered the best player of his generation and one of the best in history after winning an unprecedented four straight FIFA world player of the year awards. He has scored 133 goals for Barcelona over the last two seasons and helped it win its fourth Spanish league title in five seasons this year.

Messi, who is rated by Forbes as the world's 10th highest-paid athlete, reportedly earned $41.3 million to June this year; with $20.3 coming from his club salary and $21 million in endorsements.

Messi leads an apparently quiet life focused on his family -- he became a father last year -- and has never been linked to any unsavory episodes, making him a universally liked figure in Spain and abroad.

Spain has been cracking down on tax evasion as it fights to repair the country's public finances amid recession and the collapse of its once-booming real estate sector.

The country has been further hurt by a series of corruption and financial fraud cases which until now had been limited to the worlds of business and politics.

Information from The Associated Press was used in this report.

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