CHAMPIONS - Own goal for Uli Hoeness
A German football star excelled at tax evasion.
- Tuesday, 14 July 2015
It’s been two years since a tax office in Miesback, a small town in southern Bavaria, received a voluntary disclosure letter that was to shake up German consciences and beliefs to the core. It was signed by a former world champion during the Wall days, the president of the most powerful football club in Germany and a personal friend and advisor to Angela Merkel.
In the letter, Uli Hoeness admitted to concealing revenue from his investments on the Swiss stock market and asked to pay off his debt to the Central Tax Office in exchange for amnesty and anonymity, as offered by German law to anyone evading payment of under €1 million in taxes. Three days later he was in Berlin as a guest of the Chancellery, for a meeting to address German integration and multiculturalism, unaware that his letter had been sent on to the Munich Public Prosecutor’s Office.
It didn’t ring true. This was early in 2013 and Hoeness was about to experience a radical change in lifestyle. Today the 63-year-old, who in his youth was a shrewd and nifty striker and later became a brilliant and ruthless manager, deliverers laundry and detergent to inmates serving sentences alongside him at Landsberg am Lech, the prison where 90 years earlier Adolf Hitler dictated the first draft of Mein Kampf to Rudolf Hess, after being locked away for the failed Munich coup. Last March, Hoeness was sentenced to three-and-a-half years in jail for having concealed nearly €30 million from the taxman since 2001, in account no. 4028BEA of the Vontobel Bank in Zurich. The slush fund had for more than a decade been fuelled by his voracity as a compulsive new economy raider.
This was the dark side of a man whose successes and credibility on and off the field had made him a pillar of the community. Someone who could appear on TV and expose corruption in football or speak on social responsibility and economic austerity. “I may be stupid to do it,” he once said and everyone took note, “but I pay all my taxes. That’s how we rich help the less fortunate.”
The son of a butcher in Ulm, Albert Einstein’s birthplace, and once a butcher’s apprentice himself, Ulrich ‘Uli’ Hoeness was part of the golden generation of German footballers that dominated international football during the early 1970s with Bayern Munich and the national team.
At 20 he was already European Champion. At 22 he was on top of the world with Franz Beckenbauer. His career boasts three Champions League and three Bundesliga titles, 100 goals and two unforgettable moments: the brace that decided the 1974 European Cup Final against Atletico Madrid and the penalty-awarding tackle on Johan Cruyff, 55 seconds into the World Cup Final against Holland, which the Germans won 2-1. Hoeness wrote a book on that match that sold 300,000 copies, and then sold a photo exclusive of his wedding to a newspaper for 75,000 German marks (nearly €38,000). He had a nose for business and when, at 27, a nasty knee injury cut off his playing days prematurely, Bayern promptly moved him upstairs and he became the youngest managing director in the Bundesliga.
If the Bavarians are today the model of European football for their sporting results and economic achievements, Hoeness can rightly take a fair share of the credit. His hand was behind almost every commercial deal Bayern landed, but perhaps his greatest achievement has been the financial reorganisation of a club that hasn’t suffered losses for 20 years, has the world’s most state-of-the-art stadium and a very popular website.
He convinced wealthy sponsors such as Adidas, Volkswagen, Audi, Allianz and Deutsche Telekom to fund the global ascendancy of a team whose commercial revenue is unparalleled in Europe.
But it was here, among high-profile friends, that his boundless ambition led the former champion down the wrong path, to Switzerland. The first €2.5 million were paid into the Vontobel account by the late Adidas boss Robert Louis-Dreyfus to indulge Hoeness's trading fever. Thanks to Hoeness's support, Louis-Dreyfus later renewed the German multinational’s sponsorship contract, despite the club having received a better offer from Nike, and became one of Bayern’s minority shareholders.
“At times I was trading day and night with sums that are hard for me to comprehend today, sometimes the amounts were extreme," Hoeness confessed during his trial, revealing that the tax evasion, which prosecutors initially verified at €3.2 million, was in fact greater: the sum then jumped to €20 million and, finally, €28.5 million.
The partial admissions made by Hoeness did not convince the judges about the true nature of his collaboration, and when the Munich court passed the guilty verdict, the former world champion waved his appeal, stood down from all positions and went to jail.
In Landsberg, coat checker Uli Hoeness earns €1.12 euro an hour, lives in a room of eight square metres and can’t watch any of Bayern’s games because pay-TV is banned behind bars. Merkel and the entire political milieu that for a long time had sought him out, have stepped away. The only people still sticking by him are his old Bayern friends: Josep Guardiola, Franck Ribery and his former teammates Karl-Heinz Rummenigge and Günter Netzer have been to see him in prison. Sebastian Schweinsteiger dedicated the 2014 World Cup win in Brazil to him.
Hoeness survived a plane crash when he was 30 and could get another fresh start in 2016, if released on good conduct. The club is ready to take him back. “Tax evasion was the biggest mistake of my life and I [must] accept the consequences,” were his last words before stepping across the jail threshold. “There will be time to think about what to do later.”