The summer of 2007 was a busy one for Liverpool as, having reached their second Champions League final in three years under Rafa Benitez, new owners Tom Hicks and George Gillett marked their first transfer window at Anfield by sanctioning a £50m spending spree.
Fernando Torres was the most famous signing for the Reds that summer, joining for a then club-record £26.5m from Atletico Madrid, while Ryan Babel (£11.5m), Lucas Leiva (£6m) and Yossi Benayoun (£5m) also joined from Ajax, Gremio and West Ham United respectively. The quartet would all make a positive impact at Anfield, but it was a different story for the rest of Benitez’s eight summer signings that year.
Charles Itandje signed in a £1.4m deal from Lens, Damien Plessis was snapped up for an undisclosed fee from Lyon and Andriy Voronin joined on a free transfer from Bayer Leverkusen. Yet the most curious transfer was one that had actually been agreed under the watch of former owner David Moores back in January 2007, as the Reds snapped up winger Sebastian Leto from Lanus in an £1.87m deal after fighting off competition from River Plate, Real Betis and Racing Club.
Standing at 6ft 2, you could hardly miss the young Argentine who had caught the eye of scouts with impressive displays in his homeland, in two seasons as a first team regular when still a teenager, he scored seven goals from 50 appearances.
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“I’m very happy. It would be wonderful to play in one of the most important teams in the world,” the young Argentine said at the time. “Liverpool is a club with a big history, and they won the Champions League two years ago. It has not fully sunk in yet. I usually watch Manchester United games on TV and now I will face them!”
Yet despite an agreement for Leto’s signature being made in January, Liverpool would have to wait until August for the deal to actually be completed due to issues with the winger’s passport. It was a sign of things to come.
The 20-year-old had missed the majority of the Reds’ pre-season, including their tour of Hong Kong, due to a delay in paperwork. But after he was granted an Italian passport, courtesy of an Italian grandparent, his Liverpool career was belatedly able to get underway and he made his unofficial debut in a friendly clash with Shanghai Shenhua in Rotterdam.
“He (Leto) will be able to play in Holland,” Benitez confirmed ahead of Liverpool’s final pre-season outings. “Leto will travel with the squad and we have permission to play him in these games. It's good news for him because it's not easy when you're only training. You want to play in the games.”
A competitive debut followed at the end of August as Leto started at Anfield in the Champions League qualifiers as Liverpool beat Toulouse 4-0 at Anfield, while he'd mark his first appearance in English football, and first full 90 minutes, with an assist for Fernando Torres in a 4-2 League Cup win away at Reading the following month.
Yet he featured just twice more for the Reds, against Marseille in the Champions League group-stages and against Cardiff City in the League Cup in October, before his Liverpool career was stopped in its tracks for reasons beyond his control.
The winger was left ineligible to play for Liverpool after his passport was revoked in December 2007, after Italian police launched an investigation probing the validity of thousands of citizenship decisions, with the Reds unwilling to risk playing him until the conclusion of the probe as a result. That investigation required the club to apply for a work permit for Leto, only to see their application refused by the Department of Work and Pensions in the summer of 2008, much to the fury of Benitez.
"I cannot understand how an Argentine player who has been in pre-selection for the Olympic squad and has played in the Champions League and at a club like Liverpool is not good enough,” the Spaniard told the club’s website.
"Now we have to look for a solution, maybe find a team for him on loan, but we have maybe eight or 10 teams in Spain, Italy and Greece asking about him. When you have eight or 10 teams asking about a player and he's not playing, it means that he is good. But maybe there is another vision of football."
Despite the passport and work permit fiasco, Benitez was still hopeful Leto would be granted eligibility the following year as Liverpool were left with no choice but to send him out on loan.
“He has a long contract, and I think he can impress and next year will be a different situation,” Benitez insisted. “Hopefully in the future, if he’s playing in the Champions League, maybe someone will say, ‘Oh, we made a mistake’.
“At the end of the day, we are talking about the future of a player and I don’t think that is fair. The system needs to change, clearly.” Alas, he would again be left disappointed after the winger was sent to Olympiacos on loan.
"I spoke with the people of the club [Liverpool] and our decision is to leave the club and to play somewhere else on loan for one season," Leto was quoted as saying by Sky Sport News after his work permit was rejected. "I have to play football next season.
"My agents are in Athens. They speak with Olympiacos for my loan. Their manager, Ernesto Valverde called me. He told me that he is really interested in having me at his team. He told me about his thoughts and everything. For me its really important to have a manager who speaks my language.
"I spoke with some friends who know everything about Olympiacos and they told me that this is the biggest club in Greece, that they always win the championship and they always play Champions League football. I have some offers from Italy and Spain but Olympiacos is the best club for me at the moment.
"I am still waiting for the community passport. Liverpool will wait for it until 31st of July. Of course, my dream is to play football here in Liverpool. I spoke with Rafa Benitez and he told me that he wants me but I can't stay without the passport. He advised me to go somewhere else to play for one season and to return next summer. He is right."
"Olympiacos is a challenge for me. I know I will be here for two years," Leto would tell the Greek club's official website following confirmation of a two-year loan switch. "I've had two weeks of pre-season training with Liverpool and I believe I will be ready to do whatever I have to.
"Olympiacos are a great team who challenge for every honour in Greece and in the Champions League. The team has some good players, a well known coach (future Barcelona manager Ernesto Valverde) and fanatical supporters which always inspires them."
Leto would make 37 appearances for Olympiacos, scoring two goals and registering 10 assists, as he helped them clinch a Greek Super League and Greek Cup double. However, he would often find himself left out of the squad during the final weeks of the season after a falling out with his manager resulted in him being disciplined following an argument with Valverde in training.
“During yesterday’s training session there was an issue with footballer Sebastian Leto who for the umpteenth time gave in to disciplinary problems forcing me to send him to the dressing room,” Valverde said in a statement on the Olympiacos website in March 2009.
“For this specific incident I have informed the administrative section of the club which is there to deal with it. As I have said in the past, for me the top priority is discipline and the calmness of the team which comes above all of us.”
Despite that falling out, Benitez had been impressed by Leto’s performances in Greece and remained hopeful he would still be awarded a work permit come the summer of 2009.
"Leto is an asset for Liverpool and I hope that he will get the work permit in order to have him with us next season," he told SportDay. "I am disappointed at what happened last summer. It was a surprise for us that he didn't manage to secure a work permit.
“Leto played a high level football back in Argentina. He has experience for Argentina's Olympic team and played some Champions League games for us. Everybody says that he is good enough. There were a lot of clubs in Italy and Spain wanting him and he can't play with us in Premier League.
“I think that this rule must change. I hope him performing well for another club in another country and making his mark at the European competitions, the authorities have to admit this rule is wrong."
Come the summer, Leto would again be denied a work permit as Liverpool became resigned to selling him. Yet despite the winger’s hope for an offer from Olympiacos, he ended up joining their arch-rivals Panathinaikos after a £3m bid was accepted, before completing his permanent Reds exit on this day in 2009.
“I am very close to joining Panathinaikos,” he had revealed in June 2009. “There are negotiations between Panathinaikos and Liverpool and as far as I know the two sides are very close to a deal. I think that the possibilities of playing at Panathinaikos next season are more than 90 per cent.
“I have been waiting for something from Olympiacos all these weeks but they haven’t made a move for me so far. It's not a matter of money. I wanted to stay at Olympiacos but since they don't want to sign me I have to think about my future.”
Having won a Greek double with Olympiacos, Leto would repeat the feat with Panathinaikos in his first season with the club and made himself an instant hero after scoring the winner against Aris in the 2010 Greek Cup final. Meanwhile, he’d finish his maiden year with eight goals and 10 assists from 44 appearances.
Less impressive the following season, he then enjoyed the best form of his career in 2011/12 after reinventing himself by playing central off the striker. He'd scored an incredible 15 goals from just 17 league appearances during the first half of the season, only to suffer a serious knee injury in January 2012 which would rule him out for the rest of the season.
Sidelined for over a year, his contract was terminated in January 2013, with the winger then signing for Serie A side Catania the following April. He scored four goals from 28 appearances in his first season in Italy but was unable to help them avoid relegation, before being sent on loan to former club Lanus for a year in January 2015.
However, Leto's fortunes went from bad to worse back in his homeland as he was limited to just seven appearances after being taken to hospital for emergency treatment after a barbell fell on his head during training just a month after re-joining the club. Initially sent home by the medical staff with a deep wound in his head, he later went to the hospital after suffering headaches and was placed in intensive care as doctors feared he may have had internal haemorrhaging.
The head injury would require him to wear a protective helmet in matches, like the one worn by Petr Cech for Chelsea and Arsenal for the majority of his Premier League career.
At the end of his loan, Cypriot club Anorthosis made an offer for Leto, but the Argentine left winger asked for a 48 hours deadline because he wanted to rejoin Panathinaikos, asking for a low salary to ensure the deal went through, with his former Lanus manager, Guillermo Barros Schelotto confirming his desire to return to Greece.
"Leto was enjoying being in an Argentine club and having his family along, but he always wanted to return in Greece for Panathinaikos,” he said. “He had a serious accident, but he is strong and despite not playing much in Lanus, in a good fitness condition.
“Sebastian is a talented and clever player, with quality and still a future ahead of him, he will help Panathinaikos very much and maybe the next season decrease the difference from champions Olympiacos.”
Leto would officially rejoin Panathinaikos in February 2016 and enjoyed a prolific 18-month stint back with the club, scoring 16 goals and registering 14 assists from 47 appearances. However, he would be released in June 2017 and the following October became the latest player to file an appeal for late payment against the club, following the likes of Michael Essien, after claiming he hadn't been paid since January 2017 and was owed roughly €181,315.
He would finish his playing career with Emirates Club in the United Arab Emirates, scoring twice from nine appearances in the 2017/18, before holding talks with Fulham over a potential transfer in January 2018, only for no deal to be struck. Officially retiring in June 2019, he has since embarked on a coaching career, first serving as assistant manager for his ex-Panathinaikos manager and former Inter Milan boss Andrea Stamaccioni at Esteghlal in Iran, before following the Italian to Qatari side Al-Gharafa SC and taking up the same role - a position he still holds to this day.
Leto would ultimately not live up to the high hopes Liverpool had had for him when agreeing a deal for him back in January 2007, but Benitez, even as recently as 2011 when conducting an interview with Exedrasports in Greece, was always convinced by the winger’s potential.
“When he was with us, and this is what we noticed most of all, he was a player with enormous potential, quite quick, with ability in attacking 1v1 situations, good technique and a good shot,” the Spaniard recalled. “Above all, what stood out was that he was a player who could unbalance a defence and also with good vision.
“We thought that he had the necessary potential to mature a lot in a competition like the Premier League which requires special qualities. Mostly due to the physical qualities that he had. He was a player who was really interesting with regard to the future.
“He played several games for us and he did well. The basic problem was his work permit and the rules they have in England. Let’s just say he wasn’t allowed to stay after the first few months in England and we had no option but to sell him abroad. It wasn’t what we wanted for him but we had to accept the decision as it stood.”
While Leto would go on to enjoy a successful career in Greece, who knows how differently his career would have fared had he been granted a work permit while with Liverpool or avoided the serious injuries that would later derail his career.
A version of this article was posted in June 2022.
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