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Ancelotti facing five-year prison sentence for alleged tax fraud in 2014 and 2015 – report

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Photo by Aitor Alcalde/Getty Images

Sensational news from Mundo Deportivo has claimed that the Prosecutor’s Office is seeking a nearly five-year prison sentence for Real Madrid manager Carlo Ancelotti on charges of defrauding €1 million during the years 2014 and 2015.

Ancelotti is facing allegations of tax fraud by the Spanish state prosecutors as according to a statement released on Wednesday, prosecutors have claimed that the Real Madrid manager utilized shell companies to cover portions of his income during his initial tenure with the club ten years ago. 

The charges include two counts of tax fraud, with potential penalties totalling four years and nine months of imprisonment.

What’s the discrepancy?

According to the prosecution, Ancelotti is alleged to have reported only his salary from Real Madrid during that timeframe, omitting any income generated from image rights. 

The prosecutors also claim that he orchestrated a complex network of shell companies, which they describe as “confusing,” to conceal his additional earnings.

According to reports from El Pais, the prosecution alleges that Ancelotti deliberately excluded all earnings derived from the exploitation of his image rights when filing tax returns, resulting in declarations reflecting negative income. 

Carlo Ancelotti is facing tax fraud. (Photo by Angel Martinez/Getty Images)

Consequently, the Spanish tax authorities reimbursed him sums of money for both 2014 and 2015, amounting to €39,575 in 2014 and €529,076 in 2015.

The prosecutors assert that the income generated from these image rights amounted to €1,249,590 in 2014 and €2,959,768 in 2015, with no corresponding tax returns filed for these earnings.

Who manages his image rights?

In 2013, Ancelotti made a deal with a company in the Virgin Islands called Vapia Limited. The original plan was for Ancelotti to sell his image rights to them for €25 million over 10 years. Later, they changed the deal to only three years and €1 million.

When Ancelotti signed with Real Madrid in July 2013, part of his contract said he would give 50% of his image rights to the team. The other 50% was supposed to be managed by an unnamed company, later revealed to be Vapia LLP in London, but Real Madrid didn’t know about this until 2014.

Prosecutors say Ancelotti used Vapia LLP to make it seem like he owned his image rights and avoid paying taxes in Spain.

“In this way, the defendant used the company Vapia LLP to formally present itself to Real Madrid as the holder of the image rights despite the fact that it did not even formally have them attributed to it, since the referred assignment contract of July 1, 2013 was with Vapia Limited,” read a statement from the prosecution.

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Real Madrid News

Spain midfielder credits Real Madrid assistant manager for career success

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Photo by Dean Mouhtaropoulos/Getty Images

Spain’s European Championship campaign so far has been one filled with revelations. From young Lamine Yamal and Nico Williams on the wings to the ever-so-solid midfield, La Roja have impressed across the park and have taken the tournament by storm.

One such player who has played a critical role for the team despite not being in many pundits’ squad for the tournament is Fabian Ruiz. The PSG midfielder has been sensational for Luis de la Fuente’s men so far, scoring once and providing one assist in two games.

Despite not having any direct links with Real Madrid, the Spanish midfielder interestingly credits Davide Ancelotti for his success and AS brings the story.

A chapter in Naples

Fabian Ruiz may have never played for Los Blancos in his career so far, but he crossed paths with the Ancelottis in Naples a few years ago.

Ruiz signed for the Italian club from Real Betis in 2018 for a fee of €30 million. At the time, he was not known widely and was just seen as another routine Spanish midfielder aspiring to make it big.

As revealed by the player in a recent interview, however, it was Carlo Ancelotti’s son and Real Madrid assistant manager Davide Ancelotti who first saw the spark in him.

“Meeting him was a very important step in my career. From the beginning, he backed me, and it was not easy to pay what Napoli paid for me, a player who had not played much in La Liga with Betis.”

“If it weren’t for him, I wouldn’t be here. I have a very good relationship and friendship with him,” he added.

Fabian Ruiz credits Davide Ancelotti for his success. (Photo by GLYN KIRK/AFP via Getty Images)

A special eye

Ruiz’s comments on Davide Ancelotti only make it clearer as to why Carlo Ancelotti holds his son’s advice in high regard. It is, after all, a testament to the tactician’s keen eye for special talent.

As revealed earlier this year, it was the manager’s son who suggested Joselu’s substitution against Bayern Munich in the UEFA Champions League semifinals when the team was on the brink of elimination.

What happened next was history as the veteran scored twice within minutes to turn the game around and send the Bavarians crashing out.

Davide has been rumoured to be interested in walking his own path soon as a specialist coach, but as it stands, will continue working under his father for at least one more year at Real Madrid.

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