True value of Falcao

Football market was venerable to money laundering. Apart from that, tax evasion is a global trend of corporate culture. Recently Falcao multi-million transfer to AS Monaco FC, but is that his final destination, and how parties other than his former clubs to have a share in that insane figure?

Falcao arrived Porto in 2009. As a public company, Porto had to disclosure the financial detail of their transfers. On 15 July 2009, Porto announced that Falcao was signed for EURO 3.93 million for 60% economic rights. We did not know when the 40% gone, is that River Plate already cash-in the 40% earlier, or a financial trick to store the transfer fee offshore, or looting from the board of director or even Falcao had an "agent" since starting his football career and ask for money from every club Falcao had played. The latter was most common in Brazil and even whole Latin America, entrepreneur or even gang member borrow money to young talent in order to avoid them to become child labour in the factor but footballers, in exchanged for lifetime revenue to the lender.

We could not found "River Plate" in the 2009, which probably the deal was paid in COD basis (cash-on-delivery). Despite it is a public company, unlike Italy which they attached a player identification table to the audit report, which, on the table had contract value, capitalized acquire fee, amortized amount of capitalized fee, selling value and player loss and profit, Portuguese regulation was looser. In Portugal, there is difficult to trace every transfer fee paid and received in the report. As many deal were paid in COD, the sum of current and non-current debt /credit could not reflect the true fee.

Then how Porto acquired the remain 35% economic rights? In the report, Porto sold all its 60% economic rights of Bolatti to Natland Financieringsmaatschappij BV for EURO 1.5 million, and operação realiza da no âmbito do processo de aquisição da parcela de 40% do passe do jogador Falcao which Porto despite disclosed Falcao was related to Bolatti, it did not disclose the actual fee Porto acquire Falcao from Natland. More mystery was 40% became 35% as 5% was resold to terceira entidade. Is that Natland was the middle man, which Natland actually acquire Falcao from the true investor and retained 5%, as the case of fellow Monaco player Moutinho?

Then Falcao's record in the net had attracted many European clubs. Porto immediately, increase the release clause in the player contract, to EURO 45 million, with an agent fee EURO 6,585,150. A month later, Falcao was sold for EURO 40 million plus bonuses. It sounds profitable, but adding 3.93 + 1.50 + 6.59 = 12.02 (Porto revealed that it was 10.629 M after amortization), its means, in 2009 Falcao probably cost 8.1M  EURO in order to amortized to 4.05M in July 2011, which the revenue also had to deduct the agent fee again (3,705,000) and the portion to Natland (1,805,000), and lastly solidarity contribution (2M). Moreover, as the payment was in zero interest installments, a further 1,690,000 had to be deduct to be reflect the present value of the transfer revenue to 2011 year, which, after overall deduction, only 16.11 million profit in historical value basis, or 20.3M in amortization method. The latter was more realistic as 4 million amortization in 2-year was impaired with the goals Falcao bought.

Lastly, 12,095,150 agent fee within 2 months, is that really provide service or using contract extension to hide the true proportion of third parties ownership? In the debt table of 2011-12 audit report, Orel BV, Natland, and Mendes' Gestifute, all involved in both extension and selling. Adding up the sum, would find 5,247,650 million was paid in COD and the rest was 6.8475M debt:

consider Falcao fee was actually paid in installments, such high priority to receive 10 million within 2 year, shown how profitable the agent industry is and how messy of Portuguese football by involvement of double faced agent-investor.