Daniel Fonseca says Luis Suarez has "psychological problems" after the Barcelona forward accused his ex-agent of owing him money.
Suarez, 29, said in an interview with Montecarlo TV on Tuesday that Fonseca owes him 20 per cent of the fee from his transfer from Nacional to Groningen in 2006.
However Fonseca, a former Uruguay international, hit back at Suarez's claims and labelled the ex-Liverpool striker as a "coward".
"He's lying, because he is a child who shows that he has psychological problems, for sure, we know that," Fonseca told Radio 1010.
"That's why he is seeing a psychologist, but it's not giving him the effect he desired.
"He should change his psychologist, or see a psychiatrist instead.
"To count you need two fingers, because the kid does not know how to count."
Fonseca, who played for the likes of Napoli, Roma and Juventus in a storied career, says the rift between Suarez is not entirely over money, but something that happened in the early days of his countryman's playing days.
"The story goes because one blessed day three friends from the youth team called me, and said something uncomfortable is happening with Luis," the 46-year-old said.
"I had to tell him something very uncomfortable to this kid, and to the day I die I will not say what it was. It was a very uncomfortable truth. He did not accept it, and it did not sit well with him.
"I would prefer to have friends who tell me the truth instead of lies. So with a few words, I want him to tell the truth and not to dirty me by saying I owe him $200,000. Scoundrel!
"If he has courage, he will say the uncomfortable thing I had to tell him. That's the real reason this unpresentable character does not have the courage to talk, and has hid these past six years."