Real Madrid accepted payments of 200 million euros from the Providence investment fund, based in the Cayman Islands tax haven, according to new documents from Football Leaks. This could be investigated by the Spanish Tax Agency for possible law fraud.
The Football Leaks information was shared by the newspaper Der Spiegel and the European Investigative Collaborations. and published in Spain by the medium infoLibre, where two companies based in the Cayman Islands guaranteed a payment of 200 million euros to Madrid, although the agreement involves a higher figure.
The Spanish club signed a letter of intent with two companies, belonging to providence, in which it would charge up to 500 million euros for ten years . The first payment, already collected, was for 200 million, corresponding to the period 2017-2021. Meanwhile, a payment of another 200 million and one of 100 are missing.
According to the documents revealed, the general director of Madrid, Jose Angel Sanchez , said two companies will ready to guarantee payment to football clubs.
Two companies based in the Cayman Islands and domiciled in a building in George Town where there are thousands of domiciled companies guarantee payment to the 200 million club from a Luxembourg company with 20,000 euros of share capital! It sounds like a joke, but I’m afraid it’s serious.” Sanchez said.
Meanwhile Madrid was aware of the danger that this agreement with Providence represented, since it could face an investigation by the Spanish Ministry of Finance.
“This structure will almost certainly be questioned by the Treasury,” revealed internal club sources.
In this sense, the financial director of the merengue club, Julio Esquerdeiro , prepared an internal note where he warned of the danger.
“The investment structure used by the investor [Providence] must avoid the reputational and image risks that could derive from it for Real Madrid, and this structure must therefore conform to a common practice that does not pose fiscal risks to Real Madrid.” Esquerdeiro said.
“However, according to the aforementioned media, this was not the case and the club could face a possible accusation from the Tax Agency for law fraud.” he added.
