Corrupt to the Core

Fifa hit the headlines last week as a series of extraordinary events unfolded. First, a statement was released clearing Qatar and Russia of any wrongdoing whilst simultaneously implicating England and Australia as the only two nations that violated the bidding rules.

Then the chief investigator Michael Garcia, the man responsible for the report, released a statement accusing Fifa’s head judge, Hans-Joachim Eckert, of misrepresenting his report. Garcia is thought to be furious that Eckert’s 42 page summary of the 430 page report he submitted in September failed to include the most withering criticism from his findings; that of the Fifa executive committee which took part in the original 2010 ballot which decided the World Cup would go to Russia and then Qatar.

Naturally, there has been outrage in the English press and from the FA themselves. Chairman Greg Dyke branded the report “a joke,” continuing to say that things were looking “pretty ugly for Fifa.”

Delve a little further into the past however and you can see that the English aren’t as squeaky clean as they claim to be. It’s a sad fact but corruption and bad ethics have been at the heart of Fifa for a long time, far before Sepp Blatter became President. This may also in part explain why the English FA are getting so little support from other countries.

‘FIFA is a healthy, clean and transparent organisation with nothing to hide. There is huge public interest in FIFA, therefore we have to be as transparent as possible. We will try to communicate in a more open way so the world can believe us and be proud of their federation’ – Urs Linsi, ex Fifa General Secretary, 2003

Englishman Sir Stanley Rous was Fifa president from 1961 to 1974. During his time at the helm favour was heavily skewed towards the European countries. Of the 32 games at the 1966 World Cup 25 were refereed by Europeans, who have the likes of Pele little protection thereby alienating the South Americans.

This came to head during the draw for the quarter finals. Delegates of Argentina, Uruguay and the old Soviet Union were summoned to London for the drawing of referees for that round. When they arrived, Rous was there waiting to tell them the draw had already been made and referees had been assigned. The delegates were told that the draw had been witnessed by Rous, a West German delegate, a South African delegate and a Spanish delegate. It was allegedly later revealed the Spanish delegate was in transit at the time of the draw.

Relations with Africa were also strained. Firstly, because Rous was reluctant to give them automatic World Cup qualification. His argument was that they were not to the required standard. As we can see from today’s game the only way they will reach a higher standard is by competing regularly with the better teams. African teams have improved tenfold in the past forty years, in part because of increased access to the biggest stage on earth.

Secondly, and this is rather more shady, Rous was in favour of apartheid in South Africa. At the time he was questioned for this view and it looks all the worse in hindsight.

Rous managed to alienate more nations when authorising the World Cup play-off match between Chile and the Soviet Union in Santiago’s National Stadium in 1973.

At the time, Augusto Pinochet was dictator of the country. The National Stadium was used as a concentration camp for political purposes. A few weeks before the game prisoners were transferred and bloodstains were removed. Rightly, the Soviet’s refused to play at such a location. Rous awarded the tie to Chile.

England’s problems with Fifa certainly stem from Rous’s time in charge. There are some old heads on Fifa’s executive committee, Blatter among them, that have very long memories.

Though Rous can not be held up as paradigm of virtue, his successor Joao Havelange was arguably worse. Appointed in 1974, Havelange was the man who globalised the game, welcoming sponsors in order to finance his own campaign and future World Cups.

Arguably, the globalisation of football has played a huge part in the increase in corruption within Fifa. Whereby before the powerbase was in Europe and to an extent South America, now almost every country in the world would have a say. Under Havelange and Blatter a plethora of new federations have been established in poorer countries. These countries recieve grants from Fifa to encourage grass roots interest in the game. However, there is no strict control over how these grants are used. New federations have the same number of votes – 1 – as large established footballing countries like England or Holland. These countries don’t have the best image of England due to Rous’s time at Fifa, so they are far more likely to vote to keep the likes of Blatter in power.

‘I am deputy chairman of the finance committee of FIFA. I oversee a budget of US$2 billion and I have never seen one iota of corruption’ – Jack Warner, 2004

Bribery under Havelange wasn’t restricted to positions of power though. International Sport and Leisure was formed in 1982 by French businessman Andre Guelfi, Adidas manager Horst Dassler and Japanese advertising firm Dentsu. The firm would help market the rights for the 1986 World Cup in Mexico. Dassler was close to Havelange as the Brazilian had enlisted Adidas as primary sponsors of Fifa tournaments, alongside Coca-Cola.

Following Dassler’s death in 1987 ISL began overpaying for sports rights in the 1990s. They were declared bankrupt in 2001. In a twelve year period leading up to that date ISL had paid 185 million Swiss francs in “personal commissions” to sports officials. A fraud trial arose in 2008 following the collapse of the company, with the judge referring to the commissions as schmiergeld. In English: Bribery.

Andrew Jennings wrote in his book Foul! The Secret World of Fifa that Havelange was involved in the collapse of ISL. Then in 2011, Jennings stood in front of the Brazilian senate to allege that Havelange may have amassed $50 million or more in bribes through a front company called Sicuretta.

In July 2012 after protracted court proceedings Havelange and Ricardo Teixeira (previously on Fifa’s Executive committee) were named as beneficiaries of bribes from ISL. The prosecutor revealed the duo were paid 41 million Swiss francs by ISL.

Havelange had left office in 1998, to be replaced by Sepp Blatter, our ignominious friend. By now corruption had begun to take a foothold in Fifa. Where there is money to be made it generally will. Under Blatter’s watch things began to get really messy.

His victory in the 1998 election was dogged by controversy, as was his 2002 candidacy. Rumours of financial irregularities and backroom dealings were abound and culminated in direct accusations of bribery by Farra Ado, vice-president of the Confederation of African Football. He claimed to have been offered $100,000 to vote for Blatter in 1998.

‘Neither FIFA nor its President have anything to hide, nor do they wish to’ – Blatter, 2003

Bribery scandals have been a recurring theme at Fifa under Blatter. Mohammed Bin Hammam was found in Garcia’s report to have influenced the 2010 ballot in his country’s favour. In total he gave disgraced ex-Fifa vice president Jack Warner just over £1 million in bribes. £760,000 of this was for the Qatari’s doomed bid to oust Sepp Blatter. The rest is unaccounted for.

Nine of the twenty-two ExCo officials who made the decision to give Russia and Qatar the World Cup have since stood down, some because of the bribe allegations directed towards them. None have been charged.

Perhaps the biggest scandal is one that has not been widely reported. Andrew Jennings has written that Blatter has given himself the authority to sign cheques without the approval of his staff or colleagues. Below is an extract from Jenning’s article written in November 2011.

“Documents at the Zurich Commercial Register reveal that Blatter has had sole signatory powers for nearly two decades.

João Havelange, his predecessor as FIFA president, currently under investigation by the IOC for bribe-taking, had this power but as he lived in Rio, he allowed his then general secretary Sepp Blatter also to have sole rights. 

As corruption allegations swirl around President Blatter he could, if he wanted, write himself a cheque for the $1.6 billion in FIFA’s bank account, take his empty suitcases to FIFA’s bankers UBS on Zurich’s Bahnhofstrasse, speed on to the airport, take his last trip on a FIFA-funded jet (he never flies scheduled airlines) and abscond to safe haven in countries like Burma, Russia, Azerbaijan and Zimbabwe where he has been given warm welcomes in the last year. 

When Blatter took the presidency in 1998 he kept this power of sole signatory for himself but has denied it to his three successive general secretaries – including incumbent Jérôme Valcke. Even Julio Grondona, the chairman of FIFA’s Finance Committee, does not have this power.

Mr Grondona is currently under investigation by police in Buenos Aires following the revelation two weeks ago that he and his family and close aides control bank accounts in Switzerland containing more than $70 million. Although the accounts have featured prominently in the Swiss media, Blatter has declined to refer Grondona to FIFA’s Ethics Committee. Police in Buenos Aires are on the case.

This reporter has been banned from FIFA press conferences since 2003 after he published a documented story disclosing that Blatter pays himself a secret six-figure annual bonus for ‘loyalty.’ Blatter announced the story was ‘fiction’ and promised to sue. He didn’t. Blatter refuses to reveal what he pays himself in salary, bonuses, expenses and other perks. And what he takes in cash.”

This all seemingly points to corruption on a large scale within the organisation. Garcia’s reaction to Eckert’s statement only serves to back up the perception that Fifa is an organisation run by crooks, for the crooks. Which leads us back to the question posed so vociferously by the English press (though other nations do slowly seem to be joining the cause) yesterday.

   From the above evidence it can be said that Fifa is governed by money. Stop their income stream and they will have to react. The FBI announced yesterday that they will be stepping up their investigation into Fifa’s practices. This is crucial as they have the power to subpoena, which Garcia did not. As well as this they also have Chuck Blazer on board as a whistleblower. Blazer was previously on the Executive Committee and is the subject of an ongoing investigation for tax fraud. .

One theory doing the round is that specific sponsors have put pressure on the FBI to investigate Fifa, not wanting their brands to be tainted. This may seem outlandish but this has happened before in the past. Mastercard successfully took action against them in 2006, with their lawyer, Adam C. Silverstein, stating after the case that “lying and deception and bad faith are standard operating procedure at Fifa.”

Some have rubbished the idea of the English FA pulling out of Fifa, though this would do more damage than many believe. The Premier League’s home is England and it’s well known that it has the biggest revenue streams in world football. Fifa would miss that, as would the sponsors. Were one league to go others may well follow, with much of Europe, Asia and North America now discontented with Blatter and Fifa in some form or another. At this moment in time that doesn’t look like an option, despite the rumours emanating from Germany.

Today Dyke joined the chorus of high profile figures urging Fifa to make the report public. If enough pressure from the bigger nations is applied then that wish may well soon be acquiesced.

It’s far more likely that major action won’t be taken until 2015. That is the year of the next presidential election. If Sepp Blatter wins again, which is 99% sure, we may well see the bigger European leagues flexing their muscles.

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