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Brazilian club Botafogo is in debt to the tune of over $307 million and has had its accounts frozen by local authorities, meaning its players and staff can’t be paid.
Brazil's Botafogo can’t pay players after government freezes accounts
08/07/2014
 
RIO DE JANEIRO, BRAZIL - AUGUST 02: Edilson (L) and Lucas Zen of Botafogo celebrate a scored goal...

Brazilian club Botafogo is in debt to the tune of over 700 million reais ($307 million) and has had its accounts frozen by local authorities, meaning its players and staff can’t be paid. The team, based in Rio de Janeiro, hasn’t been able to pay some of its players for over three months now and it also owes dozens of former players their pensions. The club owed the tax man 127 million reais last year and there’s no relief in sight.


Bernardo Peirao, a spokesperson for Botafogo confirmed with the press that all of the assets have been frozen and they don’t have the money to pay anybody. Unfortunately, this isn’t a unique case in Brazil as the country’s sports ministry said the nation’s pro football teams owe more than four billion reais combined in taxes.


There’s not much the players can do about their lost wages it at Botafogo since they can’t change clubs during the season once they’ve already played in six games. Botafogo has played 13 times so far in the current season and the squad sits in 16th place in their 20-team league, which means they’re just one spot above the relegation zone.


Amir Somoggi, an advisor on business strategies in Brazil Brazilian football clubs have been receiving special treatment from the government for several years and, “If Botafogo was a corporate firm it would be bust.” Aldo Rebelo, the Brazilian sports minister added, that some of the clubs are in “dire straits.”


A Brazilian organization called the Bom Senso Football Clube (Good Sense Football Club) was launched by former and current pro players last year and is trying to help the government and Brazilian football federation come to some sort of solution. Atletico Mineiro player Gilberto Silva stated, “For the players, their motivation to train and to play games, it’s not so easy to deal with this situation. They are family men and have their own problems with their families. There have been situations like this one at Botafogo, but this is the longest I have seen.”


Fortunately for Botafogo the club can still play its home games at Maracana Stadium since they’re able to use it rent-free. However, the money pulled in on game days is shared with the operators of the stadium. The asset freeze has taken its toll in this area too though since payment from the club’s sponsors are also frozen. According to records, Botafogo’s revenue last season was 154 million reais, but the club spent 234 million reais, which represented the largest loss in their league.


Somoggi said things don’t look good for the club because, “They have to negotiate with the government and they need more money and to control costs. I don’t know how they will continue to operate.”

 
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