Swiss and U.S. authorities are cracking down on what they allege is a long-running bribery scheme at soccer’s governing body. The United States Department of Justice is alleging that, for more than two decades, sports-marketing executives paid more than $150-million (all figures U.S.) in bribes and kickbacks to high-ranking soccer officials. The charges, outlined in court documents unsealed Wednesday, paint a tawdry portrait of corruption at the highest echelon of the world’s most popular sport, a tale rife with secret meetings, cash-stuffed envelopes and bank accounts in Panama and the Cayman Islands.
How is FIFA organized?
FIFA is made up of six continental confederations, including CONCACAF (North American, Central American and Caribbean soccer) and CONMEBOL (South American soccer). FIFA and its continental confederations make money from the sale of media and marketing rights associated with soccer events and tournaments. Those rights are sold to sports-marketing companies and are then resold to broadcasters, corporate sponsors and other licensees.
FIFA executives accused
Jack Warner, 72
Former FIFA vice president and executive committee member, CONCACAF president, Caribbean Football Union (CFU) president and Trinidad and Tobago Football Federation special adviser.
According to the indictments, he solicited and accepted bribes in connection with the selection of the host nation for the World Cups in 1998 and 2010. He was also one of the beneficiaries of bribes and kickbacks paid by competing sports-marketing companies.
Around 2004, when Morocco and South Africa were vying to host the 2010 World Cup, Mr. Warner and Charles Blazer, the CONCACAF General Secretary, travelled to Morocco where a representative of the Moroccan bid committee offered to pay $1-million to Mr. Warner.
Mr. Warner sent one of his sons to a Paris hotel room to meet with a South African official who gave him “a briefcase containing bundles of U.S. currency in $10,000 stacks.” Mr. Blazer later learned that South Africa had agreed to pay $10-million, ostensibly as money for the CFU to “support the African diaspora.” Mr. Blazer was promised a $1-million share of the bribes.
The South Africans were unable to pay directly from government funds. Instead, the money was taken from funds FIFA was supposed to send to South Africa to support the World Cup. The money was eventually wired from a FIFA account in Switzerland to a bank in New York, then landed in an account Mr. Warner controlled at Republic Bank in Trinidad and Tobago.
Mr. Blazer got three payments totalling $750,000 out of the $1-million he was promised.
In 2005, Mr. Warner purchased a condo in Miami, using money from an account affiliated with CONCACAF. Beginning with the 2006 World Cup qualifiers, he negotiated the media rights for games involving the CFU with the sports-marketing firm Traffic USA. Separately, at his request, Traffic USA had a second contract for the same rights, purportedly negotiated on behalf of the Trinidadian federation. The second contract was concealed, and payments were wired to an account in Trinidad and Tobago that Mr. Warner controlled.
In May 2011, Mr. Warner facilitated the payment of bribes that high-ranking FIFA official Mohammed bin Hammam of Qatar, who was running for the FIFA presidency, was paying to members of the CFU.
Daryll and Daryan Warner, the sons of Jack Warner
Among the defendants who have already pleaded guilty are Warner’s sons, who might be asked to testify in the case. Daryll Warner, 40, a former FIFA development officer, pleaded guilty in July 2013 to wire fraud and structuring financial transactions to evade legal scrutiny. Three months later, his brother Daryan, 46, pleaded guilty to wire fraud conspiracy, money laundering conspiracy and structuring financial transactions. He also agreed to forfeit more than $1.1-million (U.S.).
The fact that the two younger Warners and former FIFA official Charles Blazer waived their indictments and pleaded guilty under seal raises the question whether they could become co-operating witnesses for the prosecution.
One of the sons is identified in the indictment as Co-Conspirator no. 14, who allegedly flew to Paris to accept a briefcase full of cash from a South African representative to clinch his father’s vote in deciding who would host the 2010 World Cup.
Charles Blazer, 70
Former general secretary of CONCACAF, former FIFA executive committee member.
Pleaded guilty to a 10-count information racketeering conspiracy, wire fraud conspiracy, money laundering conspiracy, income tax evasion and failure to file a Report of Foreign Bank and Financial Accounts (FBAR). Blazer forfeited more than $1.9-million at the time of his plea, and has agreed to pay a second amount to be determined at the time of sentencing.
Faces a maximum term of incarceration of 10 years for the FBAR charge and five years for the tax-evasion charges.
Jeffrey Webb, 50
Current FIFA vice-president and executive committee member, CONCACAF president, CFU executive committee member and Cayman Islands Football Association (CIFA) president.
Mr. Warner and Mr. Blazer stepped down amid allegations of corruption in 2011 and 2012. Mr. Webb succeeded Mr. Warner as CONCACAF president, while Enrique Sanz de Santamaria became the conference’s general secretary in 2012.
Mr. Webb’s candidacy was supported by a $50,000 payment from the American branch of the sports marketing firm Traffic. The money was sent to a company in the Cayman Islands controlled by an associate of Mr. Webb. Authorities say Mr. Sanz and Mr. Webb sought bribes for the media rights to tournaments such as the Gold Cup and the CONCACAF champions league.
Other soccer officials accused
Eduardo Li, 56
Current FIFA executive committee member-elect, CONCACAF executive committee member and Costa Rican soccer federation president.
Julio Rocha, 64
Current FIFA development officer, former Central American Football Union president and Nicaraguan soccer federation president.
Costas Takkas, 58
Current attaché to the CONCACAF president. Former CIFA general secretary.
Eugenio Figueredo, 83
Current FIFA vice-president and executive committee member. Former CONMEBOL president and Uruguayan soccer federation president.
Rafael Esquivel, 68
Current CONMEBOL executive committee member and Venezuelan soccer federation president.
José Maria Marin, 83
Current member of the FIFA organizing committee for Olympic football tournaments. Former Brazilian Football Confederation president.
Nicolás Leoz, 86
Former FIFA executive committee member and CONMEBOL president.
Sports media and broadcasting executives accused
Jose Hawilla, 71
Owner and founder of Traffic Group, a Brazilian sports-marketing conglomerate. He allegedly paid millions in bribes to South American officials for media and marketing rights and sponsorship rights acquired by United States sportswear companies.
In 1991, Traffic signed a contract for the exclusive worldwide commercial rights for the 1993, 1995, and 1997 editions of the Copa America.
In a private meeting, Nicolas Leoz, the president of the South American confederation, remarked that he “did not think it was fair” that Traffic would make a lot of money from the deal while he didn’t. Mr. Hawilla agreed to pay a six-figure bribe to an account designated by Mr. Leoz, who sought additional bribes during subsequent editions of the tournament.
In 2007, Rafael Esquivel, president of the Venezuelan soccer federation, also solicited $1-million in secret payments from Traffic. Mr. Hawilla used a number of money-laundering techniques, relying on an intermediary, Jose Margulies, who used accounts in the names of offshore corporations.
Between March 2003 and March 2008, Mr. Margulies wired more than $3.5-million into accounts controlled by Mr. Leoz, Mr. Esquivel and another soccer official, Eugenio Figueredo of Uruguay.
Mr. Margulies told a co-conspirator that he facilitated bribe payments for a $150,000 annual fee and a commission of two per cent per payment.
In 2013, Mr. Hawilla agreed to work with three Argentinian rivals, Alejandro Burzaco and the father-and-son team of Hugo and Mariano Jinkis, to bid for the exclusive rights for the 2015 to 2023 Copa Americas. They agreed to pay $110-million in bribes to various FIFA officials, including Mr. Webb, Mr. Leoz, Mr. Esquivel and Mr. Figueredo. At least $40-million has been paid to date.
Alejandro Burzaco, 50
Controlling principal of Torneos y Competencias S.A., a sports-marketing business based in Argentina, and its affiliates.
Aaron Davidson, 44
President of Traffic Sports USA Inc.
Hugo Jinkis, 70, and Mariano Jinkis, 40
Controlling principals of Full Play Group S.A., a sports marketing business based in Argentina, and its affiliates.
José Margulies, 75
Controlling principal of Valente Corp. and Somerton Ltd.