Saturday, December 10, 2016

FIFA, CONCACAF rocked by corruption arrests

May 27, 2015 by  
Filed under Specials

Source – Sportbusiness.com

Nine Fifa executives and five corporate executives were arrested on suspicion of corruption, while the Office of the Attorney General (OAG) of Switzerland opened separate criminal proceedings in relation to the allocation of the Fifa 2018 and 2022 World Cups, as a decisive week in the future of football’s global governing body took a stunning twist this morning.

More than a dozen plain-clothed Swiss law enforcement officials arrived unannounced at the Baur au Lac hotel at 6.00am local time this morning to arrest seven of the defendants charged in the US Department of Justice (DOJ) indictment. A total of 14 people were named in the indictment on charges including racketeering, wire fraud and money laundering conspiracy in relation to marketing and media deals over a 24-year period.

The focus of the US-led investigation is Concacaf and Conmebol, Fifa’s regional confederations in North and Latin America. The DOJ said that Concacaf’s headquarters in Miami, Florida, were searched this morning. Fifa vice-presidents and executive committee (ExCo) members Jeffrey Webb and Eugenio Figueredo, Fifa ExCo member-elect Eduardo Li, Fifa development officer Julio Rocha, Conmebol executive committee member Rafael Esquivel, Fifa Olympic football tournament organising committee member José Maria Marin and Costas Takkas, current attaché to the Concacaf president, were detained this morning in Zurich, Switzerland, where the Fifa Congress is scheduled to take place this week.

Former Fifa vice-president and ExCo member Jack Warner and former Fifa Exco member Nicolás Leoz were also named as defendants, along with sports marketing executives Alejandro Burzaco, who is the controlling principal of the Torneos y Competencias agency, Traffic Sports USA agency president Aaron Davidson and Hugo and Mariano Jinkis, the controlling principals of the Full Play Group agency. José Margulies, the controlling principal of Valente Corp. and Somerton, who allegedly acted as an intermediary, was also named in the indictment.

The guilty pleas of four individual and two corporate defendants were also disclosed today by the DOJ. The guilty pleas include those of Chuck Blazer, the former Concacaf general secretary and Fifa ExCo member; José Hawilla, the owner and founder of the Traffic Group; and two of Hawilla’s companies – Traffic Sports International and Traffic Sports USA. Hawilla agreed to forfeit more than $151m (€140m) as part of his guilty plea. Guilty pleas from Daryll and Daryan Warner, sons of defendant Jack Warner.

“The indictment alleges corruption that is rampant, systemic, and deep-rooted both abroad and here in the United States,” said Attorney General Loretta E. Lynch, who announced the charges. “It spans at least two generations of soccer officials who, as alleged, have abused their positions of trust to acquire millions of dollars in bribes and kickbacks… Today’s action makes clear that this Department of Justice intends to end any such corrupt practices, to root out misconduct, and to bring wrongdoers to justice – and we look forward to continuing to work with other countries in this effort.”

Acting US Attorney Kelly T. Currie added: “After decades of what the indictment alleges to be brazen corruption, organized international soccer needs a new start – a new chance for its governing institutions to provide honest oversight and support of a sport that is beloved across the world, increasingly so here in the United States. Let me be clear: this indictment is not the final chapter in our investigation.”

Just hours after the arrests, the OAG in Switzerland confirmed that it had opened criminal proceedings against “persons unknown” on suspicion of criminal mismanagement and of money laundering in connection with the allocation of the 2018 and 2022 World Cups to Russia and Qatar, respectively. The OAG added that electronic data and documents were seized today at Fifa’s head office in Zurich.

“The collection of relevant bank documents had already been ordered beforehand at various financial institutes in Switzerland,” the OAG said. “The files seized today and the collected bank documents will serve criminal proceedings both in Switzerland and abroad. In the Swiss criminal proceedings, opened by the OAG on 10 March 2015, it is suspected that irregularities occurred in the allocation of the Fifa World Cups of 2018 and 2022.

“The corresponding unjust enrichment is suspected to have taken place at least partly in Switzerland. Furthermore, the head office of the damaged party, Fifa, is in Switzerland,” the OAG added. “For these reasons, investigations are being carried out on the suspicion of criminal mismanagement. There are also suspicions of money laundering through Swiss bank accounts. Subsequently to today’s seizure of files, the OAG and the Swiss Federal Criminal Police will be questioning 10 persons who took part in voting on the allocation of the 2018 and 2022 World Cups as members of the Executive Committee in 2010.”

In a press conference this morning, Fifa director of communications and public affairs Walter De Gregorio insisted that the presidential election would go ahead as scheduled on Friday. “It is certainly a difficult moment for us, but the Congress is about to start and the Congress will take place,” he said. “There was never such an idea to postpone the congress or the election. One thing has nothing to do with the other. The election will take place as planned.”

De Gregorio added: “The timing may not be the best, but Fifa welcomes this process and Fifa will co-operate fully with the OAG. In this case, Fifa is the damaged party. It is of our highest interest that all questions can be answered… This is not good in terms of image and reputation, but in terms of cleaning up, in terms of the reform process, this is good.”

Speaking about the developments regarding the allocations of the 2018 and 2022 World Cups, he continued: “I can say that the World Cups in 2018 and 2022 will be played in Russia and Qatar. This is the fact today. I won’t go into speculation about what can happen tomorrow.”

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