Football club AS Monaco is engulfed in a series of on- and off-field crises. While it is struggling at the bottom of France’s top-flight division Ligue 1, its president was earlier this month formally placed under investigation for suspected corruption (see Mediapart’s detailed revelations here), and the French football authorities have launched a probe into its highly questionable methods of recruitment of under-age players following Mediapart’s report on the subject last week.
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But AS Monaco also faces a red card in a number of other practices, exposed by revelations published here based on documents from the Football Leaks project, obtained by German weekly Der Spiegel and studied by Mediapart and its media partners in the European Investigative Collaborations (EIC) network.
Under French law, a football agent is not entitled to receive a commission of more than 10% of the price of a player’s transfer. This rule is written into France’s “code du sport” law governing sport, and any transgression is open to disciplinary measures, and also legal action.
AS Monaco remunerates agents with what are called “service contracts”, which are not submitted for control to France’s Professional Football League. Contacted, the club firmly denied the suggestion that this practice is designed to allow it to pay agents more than the ceiling rate. “Your suspicions about this are entirely unfounded,” it said in a written reply to Mediapart (see the club’s statement in full at the end of this report).
Daniel Bique was the head of the club’s legal affairs department. On January 22nd 2014, he wrote to AS Monaco’s vice president Vadim Vasilyev to warn him of future “problems” that may arise. “As you know, the regulations impose a maximum of 10% on the player’s contract or the transfer amount,” he wrote. “Since the last summer transfer window, numerous contracts of private agreements have been concluded with several agents because their commissions exceeded the 10%. According to these agreements, they must look for players, teams, sponsors around the world.”
Bique warned: “It would be better if we used them the least possible, because the more we have, the more difficult it will be to justify them.”
According to the list that Bique drew up at that time, the club had signed six of these private agreements, which are secret documents, two of them with an agent who enjoyed close contacts with Monaco’s royal household. Officially, Goiran’s role was to “identify players” in European championships and those of French-speaking Africa. In reality, the contracts covered over the role he played in the recruitment of player Nicolas Isimat-Mirin, a defender, for which the agent received 480,000 euros. He also received a bonus payment on signature of the contract amounting to 150,000 euros, which was justified by his own contract in which he was tasked with the very vague role of “research, study and establishment of sporting partnerships between the club and other entities with the aim of allowing for the operating, training and development of professional football”.
Contacted, Bique, who has since then distanced himself from the AS Monaco management, said, “The two [Goiran] invoices for a total of 480,000 euros correspond with the Isimat operation”. He said the other payment to the agent, of 150,000 euros, “concerned the signing of another player”. Bique insisted he had not broken the 10% rule. He said the use of contracts made out for tasks such as identifying players of interest was because Goiran did not have the necessary agent’s licence for the French professional football divisions. Indeed, a 2014 email he sent to several people within AS Monaco’s management made that clear: “Because Jean-Marc Goiran does not have a FIFA agent’s licence, can you tell me who should figure in the contract as an agent, or in which way do you wish to proceed to pay him?”
Another agent, Philippe Lamboley, was paid 400,000 euros by the club for “establishing a list of 20 foreign players”. In reality, the contract concerned the transfer of forward Anthony Martial, according to a message from Bique. Super-agent Pini Zahavi was paid 1.5 million euros for “identifying players in the English championship”. Zahavi, whose company Gol Intyernational is based in Gibralter, was originally supposed to be scouting players in Ukraine and Russia, but this was changed to England on the suggestion of one of Bique’s colleagues who wrote to him, “It would be best to say English”.
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In reality, the payment made to Zahavi was for the club’s recruitment of Nigerian leftback Elderson Echiejile in January 2014. An unsigned version of the player’s contract, obtained from Football Leaks documents, indicates that Echiejile did not have use of an agent. It was common practice, the commission for agents were the subject of private agreements about which nobody was aware, above all not the French Professional League, nor UEFA, nor FIFA.
But the deal for Elderson was negotiated with two of the most prominent football agents in the world, Pini Zahavi and Jorge Mendes. “Zahavi tells me that the bonus on signing must be paid to him, not the player, do you agree?” asked the club’s technical director in a message to vice-president Vadim Vasilyev, who replied: “OK to pay Pini”, and indicated that for the rest “check with J Mendes”.
Vasilyev and Zahavi struck up a working relationship early after Vasilyev took up his position with the club. In May 2013, two months after the Russian was appointed AS Monaco vice-president, Zahavi wrote to him about his “big projects” for bring young players from the Balkans to the club.
The use of contracts for “scouting agreements” called for caution, advised bique. “Given it involves a scouting agreement and in order to arouse the least suspicion possible, it would be more judicious that the payment comes about from two settlements of 100,000 euros,” he wrote on July 25th 2016, concerning the payment of Dimitry Seluk, agent for Ivorian forward Lacina Traoré. Seluk’s 200,000-euro remuneration was for scouting “young talent in Ukraine and Russia”.
In the end, Bique decided it was preferable “to avoid a scouting agreement” and instead, he suggested, “to proceed via the invoicing of lawyer’s fees”, adding that: “We have email exchanges with the latter about the prolongation of the player, which would credit this plan.”
The Football Leaks documents show that the practice was so regular that on some occasions it was the agents who requested the camouflage, one of them writing “180,000 on signing (scouting agreement if possible)”, another complaining that a scouting agreement of 200,000 euros was missing.
In its 2014-2015 budget accounts, AS Monaco recorded spending of 3.6 million eruos on agents’ commissions, and more than 1 million euros on “scouting for transfers”.
In the case of the 2017 transfer to AS Monaco from FC Barcelona of Spanish winger Jordi Mboula, as of the moment he turned 18 and while he still had another year on his contract with the Catalan side, agent Bruno Zandonadi demanded a commission of 3 million euros, the same sum as stipulated in the player’s buyout clause. On March 21st 2017, AS Monaco’s sporting director Antoine Corton wrote on the subject: “I don’t very much like agents who ask for a large commission for themselves.” The club’s vice-president Vadim Vasilyev was also unhappy. “I don’t think we can pay 3M buyout clause plus 3M in commission, plus 20% on the future transfer,” he wrote, although he could also have said it was illegal. Deputy director general Nicolas Holveck warned: « Above all we must be very discreet on the commission. Never write anything in emails.”
Vasilyev invited the agent to lunch for « negotiations », explaining in an email: “For the moment we are very far [from agreement] on the commission and the resale percentage. But we would like to make a real effort.” In the end, Mboula was bought by AS Monaco for 3 million euros, while it is not known how much was received by the agent. AS Monaco declined to provide any information on the sum.
In the club’s 2017-2018 budget report, there is mention of four payments in August 2017 referring to Mboula by name and which total 1.75 million euros. These were “Agent Mboula-Reina” for 550,000 euros, another of the same amount recorded as “Agent Mboula-Depit”, another payment of 300,000 euros recorded as “Agent Mboula-Mindu (Cercle de Brugge) – the name in brackets is that of a Belgian club, and Mindu is a company owned by Zandonadi – and a fourth for 350,000 euros which was marked up “Agent Mboula Mindu (AS Monaco)”.
Secret agreements made with Falcao, Abidal and Toulalan
A culture of secrecy appears latent at AS Monaco. In the summer of 2013, France defender Éric Abidal joined Monaco from FC Barcelona. Abidal, now retired as a player and currently director of football at FC Barcelona, signed a private agreement which stipulated that if he played more than 25 matches his contract would be automatically renewed.
This was once again, as Daniel Bique explained to the player’s agent, a way round the regulations. “The rules of the [French] Professional Football League [LFP] do not allow making a contract prolongation conditional to the number of matches a player takes part in,” he wrote. “It’s for that reason that the terms of an eventual prolongation cannot be established other than in an agreement signed privately.” The agreement was categorised as “strictly confidential”.
The same method was used again with the signing of Portuguese defender Ricardo Carvalho, when Bique proposed a private agreement for an automatic extension of the player’s contract if he started in 30 matches, a condition which Bique again explained was otherwise “not allowed”.
Having played 25 matches, Abidal was offered an extension of his contract, but he left the club in the summer of 2014, and potentially richer thanks to another private agreement that deputy general manager Nicolas Holveck noted on June 6th 2016 was “not submitted to the LFP”. As a result of that agreement, Abidal received four payments totalling 2.2 million euros between July 2014 and April 2015.
When French midfielder Jérémy Toulalan joined AS Monaco from Spanish side Malaga on a two-year contract in 2013, the club again entered into a private agreement over the clause regarding a possible contract extension. “The clause was validated properly by the League?” asked Vasilyev. “No,” replied Holveck, “it’s a unilateral clause, so the LFP doesn’t accept it. It’s a private agreement clause.”
During the transfer, AS Monaco signed another private agreement with Malaga. “Because of the good relations between the parties and the transfer of Jérémy Toulalan”, it was agreed that Malaga could recruit Monaco’s French forward player Terence Makengo at no extra cost, or recruit another player from a list supplied by AS Monaco when 1 million euros would be reduced from the market fee.
Monaco knew that this option was not authorised by football’s regulatory bodies and removed it from the initial contract. Bique wrote to the Spanish club: “We have removed Article 2.1 (B) because it will not be accepted by the French national league. It should appear in a private agreement. AS Monaco stipulated that only Monegasque courts would rule over any eventual dispute. “I prefer Monegasque law rather than the FIFA because this sort of operation is not authorised,” wrote Bique. “But if they want only the CAS [the Lausanne-based international Court of Arbitration of Sport], that’s fine too.”
Secrecy was also the order of the day in the transfer to AS Monaco in 2013 from Atletico Madrid of Colombian striker Radamel Falcao, which was reported in the media as costing 60 million euros. In December 2016, in the first series of Football Leaks revelations, the cost was disclosed as being 43 million euros. In fact, the total sum was 53 million euros.
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In the official document sent to FIFA’s Transfer Matching System (which records and officialises transfers), there was no mention of 10 million euros paid upfront in February 2013. Atletico Madrid sent AS Monaco two invoices, one for 43 million euros and another for 10 million euros, and the latter was indeed paid.
The difference this made was that if the transfer deal was worth 53 million euros, the required “solidarity” payment to the club that first trained the player (a FIFA rule which compensates the club or clubs which invested in a player’s training and education) would reach 2.65 million euros. But if the official cost of the transfer was 43 million, the solidarity payment would be reduced by 500,000 euros to 2.15 million euros. One AS Monaco staff member warned of the a “risk of penalties” from football’s world governing body: “If FIFA learns of the existence of the 10 million clause, we could have problems,” he wrote.
Vasilyev was unhappy with Carlos Osório de Castro, lawyer for the agent Jorge Mendes, for having removed from the initial contract “the fact that Monaco has signed an option with the player”, which was a manoeuvre to hide the 10 million euros that had already been paid in the Falcao deal. “We must keep this mention,” he wrote, aware of the potential risk otherwise. “An if FIFA decides one day to consider this option of 10 M€ as being part of the transfer? In that case the 500,000 € must be paid back,” he set out, referring to the money saved on the solidarity payment.
As for Mendes’ lawyer, the hidden payment was of no problem. “The transfer should be 42 M€,” he wrote. “It is this sum that must appear in the agreement. AdM [Atletico Madrid] made a similar transaction with Manchester United in the past, and the price of the option was not billed in the calculation for the solidarity contribution.”
In the transfer paperwork, Jorge Mendes appears not as the agent for Falcao, which he was, but as the club’s agent. “Jorge will not represent the player, and the player would be very happy to affirm the same in the agreement with Monaco,” outlined the agent’s lawyer. It is common practice in football that agents’ mandates are juggled between representing the player or the club. This artificial description of their role is usually decided at the very end of negotiations.
But it was a cause for concern for AS Monaco’s lawyer, despite his experience in the business dealings in football. She argued that a written declaration from Falcao that Mendes was not his agent was insufficient given the super-agent’s well-known activities. She concluded there were few options if the club wanted to remain on the right side of the regulations in place. One option was that the commission could be recorded as only for the negotiations between the two clubs, in which case it could not exceed 6% of the transfer cost – and Mendes was asking for more than that. Another was to establish a tripartite agreement between AS Monaco, the player and the agent in which the club pledges to pay the commission that the player owes to his agent, which is allowed.
Mendes’ lawyer came up with another suggestion, which was submitted to Vasilyev although the outcome is not known. It consisted of having the commission paid by another company belonging to AS Monaco’s multi-billionaire owner Dmitry Rybolovlev. After discussions, the AS Monaco lawyer succeeded in having Mendes recorded as being the player’s agent. This also raised another problem, for when an agent is designated as representing the player, the club which pays the commission in place of the player should declare this as a benefit in kind for the player, who must pay tax on it. However, if the agent is declared as being the club’s representative instead, the extra taxation is avoided.
When in 2015 Falcao accepted a 50% reduction in his monthly salary, reduced to 500,000 euros, Mendes’ name did not feature on the documents sent to the French Professional Football League. “The player did not have recourse to sports agents and was not represented by a lawyer,” said the document. It was however the agent’s lawyer who sent the contract to Vasilyev, with Mendes copied in to the email.
Another intriguing episode was when Falcao was loaned to Manchester United for the 2014-2015 season. Finalising the move in September 2014, Manchester United’s then club secretary John Alexander sent AS Monaco an initial proposition for a one-year loan with an option to buy the player.
It was agreed that Manchester united would pay 6 million euros, plus a bonus of four million euros if the club finished the season among the top four teams of the Premier League, England’s top-flight division. But such conditional clauses are not allowed in France in the case of a loan. “According to French rules, the cost of an option cannot be dependent on certain conditions (e.g. the sporting performance of the team, the personal performance of the player etc.),” wrote Filips Dhondt, AS Monaco’s Councillor, on September 1st 2014, shortly before the transfer period would officially close. The clause was deleted from a second version of the loan contract.
A 4M-euro phantom friendly with Manchester United
The two teams appear to have found a way for the payment of the 4 million euros without them appearing in the document. The second version of the contract included an invitation to AS Monaco to play a friendly match against Manchester United at the English club’s home ground of Old Trafford in July 2015, conditional to United finishing among the top four clubs in the Premier League. United pledged to pay AS Monaco 4.5 million euros for the match, along with the inclusion of a clause that if ever the match was not played, the English club would nevertheless still pay AS Monaco 4 million euros.
One year later, on May 27th 2015, Alexander wrote to Vasilyev to announce that the match was cancelled because the team was to embark on a tour of the US and that then manager Louis Van Gaal did not want his players involved in any friendly matches after that. Monaco sent off the bill for 4 million euros, payable before June 30th.
Was the friendly match simply announced to get around French football regulations? Neither club agreed to be questioned on the issue. AS Monaco simply stated that its contracts “are all in accordance with applicable law”. What is established is that three months after Falcao joined Manchester United, the two clubs continued to refer to a loan at 10 million euros that included a conditional 4 million euros.
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Another unorthodox contract involved that between the club and its longstanding sponsor FedCom, a Russian sulphur and fertiliser producer, which signed its first contract with the club in 1996. According to Russian media outlet Sport-express, since then, FedCom has paid the club more than 100 million euros for its name and logo to appear on the players’ shirts and around AS Monaco’s stadium.
The contract renewing its sponsorship for the seasons between 2016 and 2019 (worth 4.5 million euros per season) should have been little more than a formality. But the club decided to pay a commission of 5% (worth 225,0000 euros per season) to Alga Universal Ltd, a company registered in the British Virgin Islands. Even more surprising was that the contract with Alga Universal was sent to AS Monaco by Christian Maticiuc, the representative of FedcomInvest in the Riviera principality. Maticiuc had negotiated the amount of his commission with Vasilyev, in December 2015 and again in April 2016.
In sum, Maticiuc, who declined to be interviewed by Mediapart, received a commission via a company based in a tax haven for having done his job at FedCom. Intriguingly, Alga Universal is officially managed by Global Directors Limited, a shell company that serves as a front for clients of super-agent Jorge Mendes with their offshore, tax-dodging structures. Global Directors Limited is headed by Swiss national Christian Thury. According to a document dated 2015, its only shareholder is Koper, a company used for evading taxes byby Manchester United manager José Mourinho (see more here).
In a document sourced from Football Leaks, Global Directors Limited is also mentioned as the only entity in the Brockton Foundation, created in Panama in 2003 and which is used by football superstar Cristiano Ronaldo for his image rights. Lawyer Carlos Osório de Castro referred to this in a 2010 email (see here and here). Just where FedCom is situated in this vast web remains uncertain.
Meranwhile, among the sometimes apparently curious decisions made by AS Monaco’s management was that in 2014 which, officially, was for the club not to make money. On September 29th 2014, the club’s deputy director general Nicolas Holveck informed its vice president Vadim Vasilyev of his discussion with an auditor about the results of the 2013-2014 season. “She advised us not to make a positive [financial]result this season.,” he wrote. The club has never paid taxes and she thinks a change might attract a control. So we’ve done the necessary for the result to be ‘0’.” Mediapart was unable to establish just what the “necessary” referred to by Holveck was.
Two years later, during a board meeting on September 19th 2016, Holveck detailed that the club had an operating deficit of “between 60 and 100 million euros” per season, not counting income from sales of players. Board member Étienne Franzi, a former president of the club and a Monegasque banker, was concerned about this. Of the 332 million euros injected into the club by its owner, Russian oligarch Dmitry Rybolovlevwho bought his two-thirds majority stake in 2011, less than half of that amount, 153 million euros, remained. Franzi asked about “the financing of the club in a mid-term perspective”. Vasilyev replied that it was “impossible to reach equilibrium without the sale of players, and/or abandonments in the current account”, adding that “Such a decision would imply [adopting] a less ambitious sports project”. He suggested the situation required patience.
One year after that, on September 22nd 2017, there was more encouraging news. AS Monaco had finished the season as winners of the top-flight French Ligue 1 division and had made extraordinary revenue from the sales of players. These included Bernardo Silva and Benjamin Mendy who were bought by Manchester City for 50 million euros and 57 million euros respectively, the purchase by Chelsea of Tiémoué Bakayoko for 42 million euros and, above all, the sale of Kylian Mbappé to Paris Saint-Germain for a staggering 180 million euros. In the case of Mbappé, the money would be paid only as of one year later (after an official loan period), which allowed AS Monaco to continue to make a loss and therefore escape taxes.
According to French daily L’Équipe, the sales of the four players represented a return on its investment in them (including their purchase price and salaries) of 631%. A board member at the September 22nd meeting asked whether the profit would be invested in profiles [players] of international renown”. Vasilyev replied that this was “not envisaged”. The business model appeared at that point more to earn money than win future competitions. However, during a board meeting in June 2016, the Russian said the pclub’s strategy was to “take measured risks with the recruitment of players with strong potential, to [later] carry out transfers and increase our revenues for an ambitious sporting project”.
In July 2017 Vasilyev detailed a plan to sell off part of the club “through a rise in capital or directly by the majority shareholder”. Between 15% and 20% of the club’s capital would be up for sale. “We prefer a silent partner,” Vasilyev announced, one who would be able “to develop our commercial potential”.
Questioned, the club now says “there is no project of selling the club” but that, “quite the opposite, strategies for international development are being studied”. Following Mediapart’s interview with Monegasque ruler Prince Albert II, a spokesman for Dmitry Rybolovlev confirmed to Russian news agency TASS that the multi-billionaire had no intention of selling the club.
In the summer of 2017, AS Monaco hired the Rothschild bank in London to carry out an evaluation of the club’s worth, which it estimated at between 250 million euros and 350 million euros. The club’s management decided that the correct figure should be “between 250 M€ and 400 M€”. Its financial director Alexandre Sarrazin wrote: “If we take a suitable average of the 3 evaluation modes (turnover, value of players & transfers) an evaluation of the club at around 340 M€ can be retained.”
During the evaluation process, AS Monaco, to bolster its estimated value, underlined in a document the “social and tax advantages that other clubs in Europe and France do not have”, adding: “Foreign players (except the Spanish) do not pay taxes on their salaries if they live in Monaco, and in this case their salaries can be negotiated in net [sums], which is very important for attracting major players.” AS Monaco continues to benefit in all impunity from that advantage, and also another which it outlined: “Social contributions are limited to 22,000 euros per year for employees, and to 43,000 euros per year for employers.”
Which means that when the team captain Radamel Falcao is paid a net sum of 500,000 euros per month, the gross salary that appears on his pay slip is 501,804 euros.
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Mediapart addressed a number of detailed questions to AS Monaco, and we received instead a very broad reply. These were the most pertinent comments (translated from the original text in French) which the club supplied:
“Concerning scout contracts, your suspicions about this are totally unfounded. These were about contracts of service providers which are recorded in the club’s accounts. These contracts were principally concluded in the first months following the new management of the club when the scouting department was insufficiently structured. Today, these contracts are used in precise cases when the club has need of specific know-how.
Concerning the contracts and agreements signed by the club with players, other clubs and sponsors, they are all in accordance with applicable laws, notably concerning labour and obligation laws, and also federation regulations.
Finally, we inform you that there is no project to sell the club. Quite the opposite, international development strategies are under consideration, as was the case with the New York Red Bulls, and a Chinese club (in this case in the manner of a cross-share of minority capital holdings) and, to be clear here, that project was never concretised."
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The French version of this report can be found here.