FIFA corruption targeted in sweeping US, Swiss probes

Police outside Zurich's Baur au Lac hotel on Wednesday morning, where seven high-ranking FIFA members were arrested Keystone

Seven of the most powerful figures in global football face extradition to the United States on corruption charges after being arrested in Switzerland, where authorities also announced a criminal investigation into the awarding of the next two World Cups.

Swiss federal prosecutors said on Wednesday they opened criminal proceedings on March 10 into Zurich-based FIFA, world football’s governing body, based on suspicion of “irregularities” and illegal profiteering, partly in Switzerland, related to the votes won by Russia for the 2018 World Cup and by Qatar for the 2022 World Cup.

The prosecutor’s office seized electronic data and documents from FIFA’s headquarters on Wednesday to be used in the Swiss and US investigations, and it had requested bank information before those seizures based on a suspicion of money laundering through banks in Switzerland.

Swiss police said they questioned ten members of FIFA’s executive committee who were part of the December 2010 voting that awarded the World Cups to Russia and Qatar. It said the proceedings were against “persons unknown on suspicion of criminal mismanagement and of money laundering”.

US action

That announcement quickly followed a sweep by Swiss police in which six football officials were arrested and detained early on Wednesday morning at the request of US authorities. Those arrested included two of FIFA’s eight vice presidents and a new member of its executive committee.

The Swiss Federal Office of Justice later said a seventh official had been detained.

“They were expected to uphold the rules that keep soccer honest and to protect the integrity of the game, instead they corrupted the business of worldwide soccer to serve their interests and to enrich themselves,” US Attorney General Loretta Lynch told a news conference in Brooklyn, New York on Wednesday. “They did this over and over, year after year, tournament after tournament.”

FBI Director James Comey, whose agency conducted a three-year investigation that led to the arrests, told reporters that the probe would continue until all of the corruption is rooted out.

In a statement, FIFA said it is fully cooperating with the investigation and is supporting the collection of evidence in this regard.

“As noted by the Swiss authorities, this collection of evidence is being carried out on a cooperative basis,” the organisation said. “We are pleased to see that the investigation is being energetically pursued for the good of football and believe that it will help to reinforce measures that FIFA has already taken.”

FIFA officials were escorted out behind sheets at the Baur au Lac hotel in Zurich http://t.co/1U9kXrhjzKExternal link pic.twitter.com/lrl40M5m1oExternal link

— The New York Times (@nytimes) May 27, 2015External link

The raid was carried out at a luxury hotel in Zurich that has been a favourite of the football organisation, and authorities were careful to note that FIFA President Sepp Blatter was not among those being held.

Swiss prosecutors said the US investigation was separate from its own but that the authorities were cooperating.

FIFA said it “welcomes actions that can help contribute to rooting out any wrongdoing in football.” It noted that the actions by the Swiss Federal Office of Justice on behalf of the US authorities and by the Swiss prosecutor’s office pertained to different matters, with the latter having been initiated by FIFA making a criminal complaint last November about the conduct of non-Swiss nationals in the bidding process for the 2018 and 2022 World Cups.

“The authorities are taking the opportunity of the FIFA congress to interview those FIFA executive committee members who are not Swiss residents who voted back in 2010 and are still in office,” it said in the statement.

On Wednesday evening, Blatter released a statementExternal link in which he welcomed the actions and the investigations by the US and Swiss authorities and stressed that “such misconduct has no place in football and we will ensure that those who engage in it are put out of the game”.

Timeline of events

Wednesday around 6am: FIFA officials are arrested at Hotel Baur on Lake Zurich where they had been preparing for Friday’s FIFA congress. Police separately raid FIFA headquarters in Zurich. 

Swiss police confirm six people are being held with a view to extradition to US following a US request.

The Swiss Federal Office of Justice says the bribery suspects – representatives of sports media and sports promotion firms – are alleged to have been involved in schemes to make payments to FIFA delegates and other functionaries of FIFA sub-organisations.

10.20am: Switzerland’s Federal Prosecutor’s Office says it has seized data and documents stored in IT systems at FIFA.

Swiss authorities open criminal proceedings against individuals on suspicion of mismanagement and money laundering related to the award of rights to host the 2018 and 2022 FIFA World Cups.

11am: FIFA holds press conference, confirming arrests and cooperation with police.

US DoJ says 14 defendants charged with racketeering, wire fraud and money laundering conspiracies.

1pm: Swiss justice officials confirm a seventh person is being held. 

5pm: US DoJ and FBI hold joint news conference, vowing to pursue corruption until it is rooted out, and detailing the investigations, arrests and cooperation with Swiss authorities.

6pm: Swiss authorities say six of the seven individuals arrested will contest their extradition to the United States, but that one person agreed to be extradited.

7.30pm: UEFA, European football’s governing body, calls for the FIFA presidential election to be postponed.

The FIFA officials were detained on suspicion of having taken or paid bribes of more than $150 million (CHF142 million) involving lucrative media and marketing rights to football tournaments in the Americas. The US Attorney’s Office for the Eastern District of New York said it was investigating claims that the kickbacks were accepted from the early 1990s “to the present day”.

Nine FIFA officials and five corporate executives were indicted for racketeering conspiracy and corruption in a 47-count indictmentExternal link unsealed on Wednesday morning in US federal court in Brooklyn, New York. The US Justice Department said in a statement that it had obtained guilty pleas from four individual and two corporate defendants.

Dozens of football officials are in Switzerland for the FIFA congress and presidential election, where 79-year-old Blatter is widely expected to win a fifth term.

At a news conference in Zurich on Wednesday, FIFA spokesman Walter De Gregorio said the election would proceed as plannedExternal link and the tournaments planned for Russia and Qatar would go ahead. FIFA has also ruled out a re-vote on the 2018 and 2022 World Cups.

“The president is not involved,” De Gregorio said of Blatter’s relation to the criminal probe. “He is the president and in two days there is an election.”

Jordan’s Prince Ali bin Al Hussein, who is vying to succeed Blatter as president, described the developments as evidence of a need for new leadership at the helm of the governing body.

“We cannot continue with the crisis in FIFA, a crisis that has been ongoing and is not just relevant to the events of today,” his office said in a statement. “FIFA needs leadership that governs, guides and protects our national associations. Leadership that accepts responsibility for its actions and does not pass blame. Leadership that restores confidence in the hundreds of millions of football fans around the world.”

Sports marketing

The Swiss justice ministry issued a press release stating that the alleged bribes were given by “representatives of sports media and sports promotion firms” in return for “media, marketing and sponsorship rights in connection with soccer tournaments in Latin America”.

Lynch said the most serious among the charges pertain to racketeering, or turning a football organisation into a criminal organisation, and carry prison terms of up to 20 years. She said US authorities also raided the Miami Beach headquarters of CONCACAF, football’s governing body in North and Central America.

In 2008, the Zug cantonal court found that several FIFA executives had taken bribes from the now defunct Zug-based ISMM-ISL sports marketing company.  But it was not until 2012 that the names of the guilty parties, including former FIFA president Joao Havelange, were publicly revealed.

The US Justice Department also has pushed for more transparency with Swiss banks, exacting guilty pleas and billions in penalties from some of those that have helped wealthy Americans hide assets from tax authorities.

Epicenter of sports business

As host to 65 international sports federations including FIFA and the top international court for resolving sports disputes, Switzerland serves as the epicentre of the global sports business and arbitration that goes along with it. As such, it has been under pressure to enforce more transparency.

By coincidence, the Swiss parliament is scheduled to hold a debate next week on proposed laws that would make it harder for sporting bodies to engage in corrupt activity. The potential changes could elevate Swiss standing in the fight against sports corruption.

Politicians will decide on whether to beef up the nation’s corruption laws to make it an automatic criminal offence for anyone to give or accept bribes, regardless of the legal status of the organisation they represent. A number of organisations in Switzerland, such as FIFA and the United Nations, enjoy various levels of immunity from international oversight.

Last December, parliament passed new anti-money laundering laws that classifies FIFA executives, and those of other large sporting bodies, as politically exposed persons. This will allow the Swiss authorities to scrutinise the private bank accounts of such officials.

The justice ministry said six of seven individuals arrested on corruption charges would contest their extradition to the United States, but one person agreed to be extradited. US officials now have up to 40 days to submit formal and detailed extradition requests to Swiss authorities.

The US case alleges broad corruption at FIFA over two decades.

The US Justice Department named the nine defendants as: FIFA Vice President Jeffrey Webb; FIFA executive committee member-elect Eduardo Li; FIFA development officer Julio Rocha; Costas Takkas, a former Cayman Islands Football Association general secretary; Jack Warner, a former FIFA vice president; FIFA Vice President Eugenio Figueredo; Rafael Esquivel, the Venezuelan football federation president; José Maria Marin, a former Brazilian national football federation president; and Nicolás Leoz, a former FIFA executive committee member.