A court in Madrid has sentenced Carlo Ancelotti to a one-year suspended prison term and fined him 386,362 euros (over $450,000) for tax fraud while he was manager of Real Madrid in 2014.
Spanish prosecutors accused Ancelotti, 66, of defrauding the state of 1 million euros (over $1 million) in undeclared earnings from image rights in 2014 and 2015, The Guardian reported. Image rights grant the right to control how one’s image is used commercially and can be valuable.
While prosecutors initially sought a prison sentence of up to four years and nine months on two counts of tax fraud, Ancelotti, who now coaches Brazil’s national team and no longer lives in Spain, will not serve jail time because the sentence is less than two years and he has no criminal record, ESPN reported.
Ancelotti, who paid back the debt in full in 2021, testified that he had “never thought about committing fraud” and had left the handling of his financial affairs to advisers.
The Italian is one of soccer’s most prolific and successful coaches. Besides Los Blancos and Brazil, he has coached Chelsea, Paris-Saint German, Everton, Bayern Munich and AC Milan, and he has won the Champions League five times.
Details of Ancelotti’s tax arrangements were revealed in the Pandora Papers, an investigation led by the International Consortium of Investigative Journalists with a team of more than 600 journalists from 150 news outlets that revealed the financial secrets of scores of world leaders, politicians and public officials, as well as a global lineup of fugitives, con artists and murderers.
The two-year collaboration was based on a trove of more than 11.9 million confidential files leaked from 14 offshore services firms from around the world that set up shell companies and other offshore nooks for clients seeking to keep their financial activities in the shadows.
El País reported in 2021 that the two companies Ancelotti used to receive payment for image rights were through a structure set up by employees of Trident Trust, an offshore service provider at the heart of the Pandora Papers document trove. With offices in the British Virgin Islands and operations in more than 20 jurisdictions, Trident Trust is one of the world’s largest offshore service providers.
Ancelotti is the latest of several celebrities and sports identities to appear in ICIJ offshore investigations and to be pursued by Spanish tax authorities, including Shakira and Lionel Messi.