Jonathan Calleri is doing everything in his power to opt out of his loan deal with West Ham United. Through the only channel available to him, Calleri tapped his father to speak with his former club, Sao Paulo, about wanting to return. Brazilian reporter, Jorge Nicola, says a Sao Paulo board member revealed this information in the hopes of West Ham releasing Jonathan from his loan contract.
Just to further curdle the milk, Jonathan Calleri has admitted West Ham United wasn’t his first, second, or even third choice for European football. Calleri wanted to take his talents to Sevilla, and when that didn’t pan out, he looked towards Inter Milan. Jonathan begrudgingly accepted a West Ham United transfer as it proved to be his only chance at European football.
Eyebrows were raised when news broke the deal has originated from Deportivo Maldonado. Maldonado is a tiny league two side in Uruguay who play in front of 200 fans. Why would a talent like Jonathan Calleri sign with a small club like Maldonado? For the money, of course! Maldonado is actually ran by an investment firm who specialize in buying high priced players and then immediately loaning them out to big clubs for a profit. The actual team, Deportivo Maldonado, is a run down, cement cracked stadium where ‘fans’ are seldom seen.
The team is a front for a financial organization that is run by English racehorse owner Malcolm Caine and the London-based lawyer Graham Shear. Why would two non-football related men based out of London run a tiny lower division club in Uruguay? Simple; for the chance to get in on the ground floor for the next big name player. Bloomberg first questioned the numbers behind this footballing anomaly back in 2014. In a response to their article, Malcolm Caine had said:
Deportivo Maldonado operates “in exactly the same way as any professionally run football club” and its trades are approved by FIFA and Uruguay’s soccer federation.
A report by Mundiario puts Maldonado at investing €32.09 million in players since 2009. That is a lot of money for a club that barely brings 200 fans in a match. The investment allowed them to sell Alex Sandro to Porto for €9.6 million, and Jose Willian to Sociedad for €5.9 million in 2011. In 2013, the club managed to invest in, Willian Jose da Silva, who unsurprisingly never even made it to the stadium’s ground. He was immediately sent off to Real Madrid in a complicated loan proceeding. This year was the latest in unusual spending by the club. Jonathan Calleri’s deal is rumored to be worth upwards of €20 million as well as their sale of Rulli to Manchester City for €14 million.
How is it a club, who struggles to put 200 people in its seats, manage to deal some of South America’s most elite players?
TPO, or third party leadership, has been outlawed by FIFA’s governing bodies effective May 1st, 2015, but there are still loopholes and triggers that exist to this day. TPO is the ownership of a player's economic rights by third-party sources, such as football agents, sports-management agencies, or other investors. Michael Platini has called this practice a modern form of slavery and said the practice is shameful.
Why not have this TPO backed club closer to the more popular leagues of Brazil or Argentina? In Uruguay there is legislation that allows players to save up to 40% via tax costs. Recently the Uruguayan soccer federation increased the tax rate on player trades to 12.5% from 4%, but that is still a large gap when comparing to the 35-40% in Argentina and Brazil.
So what does this all mean for a player and why would they agree to it? As a player, I agree to sign with Maldonado and their low player tax rate along with the promise they ship me off to play in the spotlights of Brazil or Argentina. In this case, Jonathan Calleri agreed to sign with Maldonado knowing he’d never see a day on their pitch. Calleri spent a year at Sau Paulo racking up 16 goals in 31 matches, and was quickly snatched by West Ham United. For the buying club it allows them to purchase players at a lower fee, as well as a lower tax rate, while also limiting their investment should the player fail to reach their potential. Meanwhile, the TPO has a chance to make a significant profit on their investment by putting the player on a bigger stage in Europe.
Players such as Jose Bosingwa, Aly Cissokho, and João Moutinho were all partially owned by TPOs whilst playing for FC Porto. Elsewhere, Brazilian forward Hulk had 50% of his player rights bought from Uruguayan side C.A. Rentistas when he joined the Portuguese club in 2008. Angel di Maria yielded a 64% return on funds, Pepe’s return was 146.62%, and Falcao returned a 164.5% for his investors.
This practice is not unusual to West Ham United who over the years seem to get more and more involved in deals surrounding TPOs. The Hammers signed Javier Mascherano and Carlos Tevez from Corinthians in 2006, despite heavy interest from other clubs in Europe. Much like Jonathan Calleri, nobody was quite sure what the details of the Tevez and Mascherano deal were. Eventually, the intricacies of the deal surfaced and both players were actually owned and registered to two sporting investment firms.
While everyone remember’s Carlos Tevez’s winner at Manchester United, few recall that it was that goal that eventually put an end to TPOs in the Premier League. After complaints from Sheffield United who were relegated because of that goal, legal action was taken against West Ham United for failing to disclose the details of the loan to the Premier League, as well as the third party arrangements.
Jonathan Calleri’s loan details strike eerie similarities to that of Tevez and Mascherano. For one, nobody seems quite sure what the nature of the loan deal between Deportivo Maldonado, Sao Paulo, and West Ham United is. Some report the deal is a straight loan between Maldonado and West Ham, while Sao Paulo’s board were surprised by that claim. However, the Guardian is reporting West Ham reserve the option to buy Calleri for around £16m. The second, and far more important, similarity is none of these players seem to want to be at West Ham.