FC Barcelona’s close call with fraud in Lewandowski transfer

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Tajul Islam
  • Update Time : Saturday, October 19, 2024
FC Barcelona

In the summer of 2022, football fans were enthralled by the news of Polish superstar Robert Lewandowski’s transfer from Bayern Munich to FC Barcelona. The deal, worth 45 million euros, was a major coup for the Catalan club and Lewandowski’s agent, Pini Zahavi. Known for orchestrating some of the most high-profile transfers in European football, Zahavi celebrated the successful negotiation, calling it “one of the most difficult transfers” of his career. However, behind the scenes, Barcelona found itself the target of an audacious fraud scheme-one that nearly cost them a million euros.

This incident, which was later revealed by investigative journalists, exposed a lingering vulnerability in the football world: the ease with which scammers can exploit high-stakes financial transactions. In this case, a fraudster impersonated Zahavi and requested 1 million euros from FC Barcelona, directing the payment to a Cypriot bank account held by an individual named Michael Gerardus Hermanus Demon. Despite obvious red flags, such as discrepancies in the email address and the recipient account details, FC Barcelona reportedly initiated the transfer. Although the payment was eventually blocked, the episode raises alarming questions about the safeguards in place within football’s financial operations.

In July 2022, just ten days after Lewandowski’s transfer was announced, FC Barcelona received an email purportedly from Zahavi requesting a 1 million euro installment as part of his commission. However, the request came from an email address unfamiliar to club officials and directed the funds to a Cypriot bank account held by someone other than Zahavi. The recipient, identified as Demon, was presented as a lawyer and an intermediary in the deal.

Ordinarily, such irregularities-especially in a multimillion-euro deal-would prompt thorough scrutiny. The football industry, valued globally at around $600 billion, has come under increasing scrutiny for being a potential breeding ground for financial malfeasance, from money laundering to tax evasion. Yet, in this case, FC Barcelona proceeded with the payment.

The attempted transaction came to light in early 2023 when reporters from the Spanish radio show “Que t’hi jugues” on Cadena Ser obtained a copy of the fraudulent email. They shared the information with investigative partners from the Organized Crime and Corruption Reporting Project (OCCRP), Austrian outlet Der Standard, and Paper Trail Media. Their investigation revealed that FC Barcelona staff initiated the transfer without recognizing the discrepancies in time. Fortunately, compliance officers at the Bank of Cyprus flagged the transaction as suspicious and blocked the payment.

The fact that the Bank of Cyprus flagged the payment highlights an important safeguard in international finance: the role of compliance officers in monitoring suspicious transactions. According to one of the anonymous sources from FC Barcelona, the club’s staff realized the error and attempted to stop the wire transfer. However, it is unclear whether their intervention occurred before or after the bank had already blocked the payment.

In the wake of the incident, Zahavi confirmed to journalists that the email was fraudulent. He explained that he had not sent any payment request and had alerted FC Barcelona after receiving a call from a club director. Zahavi reportedly advised the club to investigate the email further, helping to prevent what could have been a costly mistake. In an interview, Zahavi said a club director later “hugged me and thanked me for saving them from a terrible mistake.”

Despite the close call, FC Barcelona has refused to comment officially on whether they attempted the payment, only confirming that no money was lost in the process. The club also claimed to have reported the incident to Catalan police, but local law enforcement officials told reporters that no formal complaint had been filed.

The recipient of the requested payment, Michael Gerardus Hermanus Demon, was quickly tracked down by journalists. When contacted, Demon denied any involvement in the attempted fraud, claiming that his identity had been stolen. He insisted that he did not hold any accounts in Cyprus and had no knowledge of the FC Barcelona transaction. “Unfortunately, I was a victim of ID fraud. My ID was stolen/lost sometime in 2022,” Demon wrote in response to reporters’ inquiries.

Demon’s name does not appear in any professional records related to football or law, and searches of Dutch and international bar associations found no trace of him. The Bank of Cyprus, meanwhile, defended its customer verification process, asserting that its protocols ensure the authenticity of identification documents. The bank declined to comment on the specific details of the blocked transaction, citing confidentiality policies.

The near-miss fraud at FC Barcelona is symptomatic of a much larger issue within professional football: the lax financial oversight that leaves clubs vulnerable to scams. Andrew Mills, a sports consultant with experience in the English Premier League, expressed disbelief that a major club like Barcelona could initiate such a payment based on an email. “The days of ‘send this amount to this bank account’ are long gone,” Mills told reporters. “As a business, you have got to invoice. There should always be a paper trail.”

Mills’ sentiments were echoed by Kieran Maguire, the author of The Price of Football: Understanding Football Club Finance. He noted that the sheer complexity of football transfers and the sums of money involved make the industry an attractive target for scammers. “The lack of due diligence that you see in certain departments in football clubs is quite staggering,” Maguire said, adding that he “would not be surprised” if FC Barcelona attempted to send the payment based solely on the email request.

Indeed, the international football transfer market is worth billions annually, with Europe’s top five leagues accounting for the lion’s share. The immense financial flows within this sector, often shrouded in opacity, make it susceptible to fraud and other forms of financial crime. A 2022 report from the United Nations Office on Drugs and Crime (UNDOC) identified gaps in banking oversight and the use of offshore accounts as major vulnerabilities in the football industry.

In response to such incidents, there have been increasing calls for greater regulation and transparency in football finance. European officials are pushing for mandatory safeguards in club financial operations, including enhanced customer verification and transaction monitoring systems, by 2029. These measures aim to curb the illicit financial flows that have long plagued the sport, from falsified transfers to outright money laundering.

Despite these efforts, stories of fraud and corruption in football continue to make headlines. In 2018, Italian club Lazio fell victim to a similar email scam, paying 2 million euros to fraudsters who posed as the Dutch club Feyenoord after the transfer of defender Stefan de Vrij. As Jim Gee, a financial and cybercrime specialist, remarked, the combination of weak accounting practices and wealthy owners creates a fertile ground for fraud. “In that kind of loose environment with powerful people in it, you’re more likely to find corruption and fraud,” Gee said.

The attempted scam involving FC Barcelona and the Lewandowski transfer is a stark reminder of the vulnerabilities that persist in professional football. While no money was lost in this instance, the incident underscores the need for stronger financial oversight and transparency in a sport where billions of euros change hands each year. As football clubs continue to grow in value and influence, their financial operations must evolve to meet the challenges of a world rife with fraud and corruption.

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Avatar photo Tajul Islam is a Special Correspondent of Blitz.

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