Brasileiro Club Flamengo Signs Up Top Execs To Help Save Club From Tax Debt
Brasileiro club Flamengo said it is “the most loved club in the world,” and the club "is counting on that affection to help rescue it from the taxman," according to Tariq Panja of BLOOMBERG. Flamengo may be the "most popular in Brazil," but it is "also the most indebted." Flamengo President Eduardo Bandeira de Mello said that the club owes creditors R750M ($351M), two-thirds of which is in unpaid taxes. Prominent fans including former head of the central bank Carlos Langoni and top execs from Brazilian companies "have joined the club’s board to fix its finances by cutting debt and are now raising money through sponsorships and membership fees." Bandeira de Mello said, "We knew the numbers were going to be bad but nobody knew exactly how bad they were going to be." Consultant for several Brazilian teams Amir Somoggi said, "In Brazilian football there’s no accountability. Right now we’ve had 10 or 20 years of bad management. Maybe we need to wait 10 or 20 years for the situation to change." Under an agreement with Brazil’s federal revenue office, almost 60% of Flamengo’s income "will be used to pay off the tax debt for the next three years," before, Bandeira de Mello said, a more manageable schedule is established and the club "will be able to breathe again" (BLOOMBERG, 6/6).