Fabio Paratici made his name as a shrewd transfer negotiator during his tenure as Director of Football at Juventus, something that he was able to leverage in order to take a similar position at Tottenham Hotspur. However, it’s looking like that same tenure could get him into hot water.
According to the New York Times, Juventus (along with Napoli and Sampdoria) is under criminal investigation by Italian financial authorities for false accounting whereby they inflated player transfer valuations in order to creatively balance budgets and stay within Financial Fair Play regulations. Gazetta dello Sport states that Paratici is one of six people under investigation by Italian finance police Consob, along with Juventus president Andrea Agnelli and vice-president Pavel Nedved. This announcement comes after a six month prior investigation by Italian authorities.
The crux of the investigation revolves around a number of Juventus player transfers — 42 to be exact — that took place between 2018-2021, with many of them involving young or relatively unknown Juventus players. Those players were sold or included as makeweights in player transfer deals with valuations that far exceeded their actual worth, dubbed by the Italian media as “plusvalenza.” The most notable is the 2019 “swap deal” that sent Miralem Pjanic to Barcelona for Arthur, with the players valued at €60m and €72m respectively; that is a ridiculously high valuation for Pjanic and raised eyebrows with the Italian authorities.
Another transaction under investigation involved another swap deal that sent Joao Cancelo to Manchester City in exchange for Danilo, as well as other transactions that involved youth team players for exorbitant fees despite them not having played many, if any, first team minutes. Consob apparently raided the Juventus offices in Turin and Milan looking for information, and Paratici is going to be questioned about his role in arranging these transfer deals.
Why do this? It’s an accounting trick that allows clubs to show “profits” (capital gains) of tens of millions of pounds on their books to offset larger, amortized purchases made over a period of years. It’s also a way of shadily staying under the radar of Financial Fair Play regulations, which require that clubs not spend more than they make by a certain amount over a period of years.
Some have wondered how Juventus were able to even come close to balancing their books after signing Cristiano Ronaldo and his massive wages from Real Madrid in 2018. This may be how they attempted to do it — by inflating the valuations of lesser or young players, shipping them off to other clubs, and claiming that “income” to cook their books.
I am absolutely not a Finance Knower, and there are undoubtedly layers to what’s going on here that’s escaping me, but this is the gist of it, as I understand it. Juventus is surely, SURELY not alone in using this kind of “creative accounting” — if I were to hazard a guess, this is commonplace among football clubs all over Europe and the world. Juventus just seemed to be exceedingly brazen about it, and possibly did so out of desperation in order to financially justify bringing in CR7 along with other players they couldn’t otherwise afford.
Juventus, Napoli and Sampdoria could be in DEEP trouble over this, but it’s currently unclear what this means for Paratici. It’s very unlikely that Tottenham are going to face any issues over these financial irregularities — it doesn’t involve Spurs in any way other than that Paratici is now working in London instead of in Turin. Paratici himself is another matter, and we don’t yet know what the range of punishments is if he is found to be culpable for these irregularities. Possibly it could involve a mere slap on the wrist, perhaps a hefty fine, but who knows. His involvement certainly doesn’t look very good and could call into some question the efficacy of his work done since joining Spurs this summer should he found guilty.
Apparently at Juventus, if you’re not cheating, you’re not trying.