How European football clubs did business with Russia (bypassing sanctions)

There are apparently 28 European football teams who are ignoring sanctions linked to the war in Ukraine by buying and selling players to Russian clubs. These also include four Italian clubs: Bologna, Salernitana, Torino and Udinese. A total of 30 suspicious transfers were detected in the international investigation conducted on non-compliance with the bans imposed by the European Union on doing business with people and companies linked in any way to Russian President Vladimir Putin. Eighteen players arrived in Europe with a total of €66 million paid directly to clubs or sent to European bank accounts linked to their owners. According to a team of European journalists, these operations will be banned in both cases by the European Commission and the member states to which the football clubs belong. International journalistic investigation coordinated by Dutch media reveals possible violations follow the moneyThe event was attended by thirteen newspapers, including El Pais, Le Monde and Die Standard. The investigation will reveal one of the many channels used by the Kremlin and oligarchs close to Putin to circumvent international sanctions imposed against them.

Purchase from Italian clubs

The media collected publicly available transfer data on owners, coaches and players of Russian teams and compared them with sanctions lists in Europe, the USA and the UK. The clubs are not on the list of those directly affected, but on the list of their owners. This is, for example, the case of Vtb Bank, the sponsor and owner of Dynamo Moscow. The bank is the second largest financial institution in the country, with very close ties to the Kremlin and the country’s strategic assets. Bologna transferred Italian-Croatian midfielder Nikola Moro to Dinamo Moscow. The football player was first loaned from Dinamo Moscow on August 29, 2022, with the right to purchase. The war in Ukraine had begun a little more than six months ago. Bolognese players will purchase him directly on July 2, 2023, contract him until June 2027, and pay 2 million 500 thousand euros to the Russian club’s coffers. Instead, Salernitana bought Norwegian midfielder Emil Bohinen from CSKA Moscow for 3 million 250 thousand euros. Slovenian defender Jaka Bijol, worth 4 million euros, was also transferred to Udinese from the same club. Torino, on the other hand, added the naturalized Russian football player Georgian Saba Sazonov to the team for 2 million 750 thousand euros. The central defender was purchased by Granata from Dynamo Moscow on August 30 this year.

Millionaires and “butchers”

30 transfers to European clubs were made with Russian teams owned by state banks, oil companies, millionaires and even Ramzan Kadyrov. The man who rules Chechnya on behalf of his ally Putin and is described in the Western media as the “Butcher of Grozny” for the atrocities he committed. Kadyrov is also the honorary president of Akhmat Grozny, from which Olympique Lyon and Red Bull Salzburg buy players. In Spain, suspicious transactions involve Real Sociedad, Espanyol, Cadiz, Almería and Elche. They would all be breaking community rules. “These clubs may have violated the sanctions: if the team belongs to an oligarch or a sanctioned entity, this could easily be considered a violation,” summarized Ángel Saz-Carranza, director of the Esade Center for Global Economics and Geopolitics, a prestigious Business school. In Barcelona. Lawyer and Russia sanctions expert Heleen Over of Linden agrees.

Ball in the middle of Russia

Participating Russian teams include CSKA Moscow, Spartak Moscow, Lokomotiv Moscow, Dinamo Moscow as well as FC Krasnodar, Rubin Kazan, Zenit and the aforementioned Achmat Grozny. Even if the owners of the teams are not listed internationally, European regulations on deposits make payments almost impossible and prohibit Russian subjects from depositing more than 100 thousand euros in a bank account. If the sale of a player goes to a team whose owners are listed in Europe or North America, his assets must be frozen after he leaves Russia. Since the end of February 2022, nearly 99 agreements have been signed between Russian and foreign teams around the world. This is 300 million euros, not counting the loan players, which do not require financial contributions, in transactions that took place after the invasion of Ukraine.

Football leaders are silent

It is an interesting situation that Dinamo Moscow football player Arsen Zakharyan, who was hired by Real Sociedad in August this year, was called to replace the recently retired David Silva. About 13 million euros were spent on the purchase, which were paid to Russian banks. Interviewed with the newspaper El PaísThe Basque team merely explained that the Spanish bank they worked with did not object: “All checks have been made: the ‘football player’ category is not included in the sanctions lists,” a club spokesman said. Other European clubs, such as PSV Eindhoven, instead did business with Spartak Moscow, which is part of Lukoil, one of the world’s largest oil and gas companies and sanctioned by the United States after the annexation of Crimea in 2014. In response to the accusations, many Spanish and European clubs, such as Red Bull Salzburg, Nice or Sparta Prague, pointed out that FIFA or UEFA, which are supposed to control transfers, do not pose a problem when dealing with Russia. The same seems to be true for national economy ministries.

UEFA line

UEFA sent a letter to football federations in April 2022 to overcome the obstacle with Russian clubs. According to this document, a team must show that it has done everything possible to pay and in turn hand over the transfer to the national football association. The letter has not been published but can be read on the Bosnian Federation website. So far only PSV Eindhoven has announced that they “transferred the money to the Russian club’s coffers”, following UEFA’s instructions, but did not make any direct payments or even deposits. Other European clubs claim that after reaching an agreement with the Russian club, they paid the sum for the player to a third-party account belonging to other European banks, but not to the national association.

hidden payments

According to an expert on private international law consulted by the authors of the investigation, the Supreme Court of Justice could be approached to find out how far the law on sanctions goes and whether it also applies to Russian football clubs. Let’s get back to the companies and oligarchs who may or may not be clearly affected by the sanctions. There are also a number of tricks used to hide the real owner of a team and who received the money. “A typical method of operation is the interception of corporate networks with entities located in countries where sanctions do not apply, so it is not possible to know who is hiding behind this legal entity; another is the payment of transactions made in banks, outside the circuits of European banks. In countries where these sanctions do not apply”, money laundering is Mariano García Fresno, who is interested in prevention, explained to El Pais. With a few weeks left before the start of the winter transfer window, it would be useful to understand whether UEFA will decide to set a clear line regarding these transfers. Otherwise it would mean the football world evading the rules that apply to many other European companies, punishing but also respecting sanctions.

We asked Bologna and Salernitana companies for clarification on this issue, but had not yet received a response at the time of publication. We will update the article as soon as we receive them.

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