Pacquiao, who bowed to Erik Morales in a blockbuster fight in Las Vegas two weeks ago, has ordered his new team of professionals, including managers Shelly Finkel and lawyers Keith Davidson and Nick Khan, to go all-out in gathering evidence against promoter Murad Muhammad and business manager Rodolfo Nazario, whom he accused of mismanagement.
"They have to account for themselves," Pacquiao told US-based writer Winchell Campos, referring to Muhammad and Nazario.
After years of being left in the dark about his finances in the United States where most of his big fights occurred, Pacquiao tried to stay cool after being told that he has not allegedly paid a single cent representing taxes since 2001.
Pacquiao’s tax problems have been kept secret from him up until he fought Morales. Pacquiao, who commended Morales for coming in prepared and ready, cited the distraction as one of the reasons why he lost the fight.
Muhammad and Nazario helped stir Pacquiao’s career to greater heights starting on June 23, 2001 when he won the International Boxing Federation super-bantamweight belt, defending it four times en route to winning the Ring Magazine "People’s Champion" belt after demolishing Mexican Marco Antonio Barrera in 2003.
Initial talks with the Internal Revenue Service (IRS) indicated that Pacquiao has been remiss in paying taxes due the US government since 2001, according to Davidson, who spoke to a senior IRS officer Tuesday.
In fact, the IRS threatened to withhold 100 percent of Pacquiao’s $1.75 million prize after learning of his case, which is common to foreign-based boxers. Pacquiao has become one of the most exciting boxers to invade US soil and despite his gallant loss to Morales, his stock has never dropped but instead risen more.
Pacquiao’s good faith in seeking the truth regarding his taxes, as well as his intention in paying anything that he might have owed, was the main reason why the IRS deducted 30 percent from his purse, amounting to $525,000.
Two months before the fight with Morales, Pacquiao was in a quandary as to how he will correct a mistake he made in December 2004 when he signed a two-fight agreement with Muhammad even under duress.
Pacquiao linked up with Finkel last February, knowing that a protracted battle looms and that Muhammad has an inside stake on the pay-per-view earnings which was never brought to his attention.