FIFA’s Corruption Scandal
Early this morning in Zurich (or late last night for those of us stateside), Swiss plainclothes police entered the Baur au Lac; the five-star hotel was the site of this week’s annual meeting of FIFA, soccer’s global governing body. The officers ascertained room numbers from the front desk, headed upstairs, and arrested six FIFA executives.
Hours later, across the Atlantic in New York City, the Justice Department unsealed a 47-count indictment against 14 defendants—including FIFA bigwigs, sports marketing executives, and the owner of a broadcasting corporation—with charges of racketeering, wire fraud, and money laundering. But there’s a lot of background here, so let’s get into it.
What exactly did these people do?
The Justice Department’s announcement primarily cites deals between FIFA, sports marketing groups, and broadcast corporations for the television rights to air the World Cup and other international soccer tournaments. Dating back to 1991, the indictment alleges, those involved conspired to receive bribes from marketing firms in exchange for exclusive television contracts—to the cumulative tune of more than $150 million. As Attorney General Loretta Lynch stated, “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.”
I thought I’d heard other, more recent, whispers about FIFA.
In 2010, FIFA awarded the 2022 World Cup to Qatar, which led to reports of vote buying, but that’s not a focus of this particular investigation. This is a federal case, and the indictment deals chiefly with alleged fraud and corruption in North and South America. Until now, FIFA has deflected widespread corruption allegations by finding and suspending scapegoats, rather than acknowledging any problems at an institutional level.
So who got arrested?
Most of the defendants are from CONCACAF and CONMEBOL, the organizations that run North and South American soccer, respectively. Those arrested in Zurich hailed from the Cayman Islands, Trinidad and Tobago, Nicaragua, Costa Rica, Uruguay, and Venezuela, among others.
In addition, the Justice Department announced unsealed guilty plea deals with four other individual and two corporate defendants, including former FIFA executive Charles Blazer (the subject of a fascinating investigative profile last year, and an unbelievably corrupt official in his own right), and José Hawilla, “the owner and founder of a Brazilian sports marketing conglomerate.” Hawilla in particular will forfeit $151 million as a part of his plea, which illustrates just how much these guys do not want to go to prison.
While the defendants are a who’s-who of senior FIFA executives and their broadcast partners who benefited from kickbacks, there’s one big fish not named in the case: FIFA president Sepp Blatter.
Wait, isn’t he a Bond villain?
Joseph “Sepp” Blatter has been president of FIFA since 1998; under his watch, football has increased in global popularity and become financially successful beyond imagination. But while he maintains that FIFA is but a humble nonprofit doing humanitarian work to bring sport to the world, he’s basically the head of a shadow nation-state that doesn’t “govern” world soccer so much as it plunders countries that want to host the World Cup. (Like, say, Qatar.) He’s also enough of a charmer to have said that women’s soccer would be more popular if the players wore tighter shorts.
But in 2013, FIFA covered 90% of the £16 million budget for the film United Passions, a deluge of fictional propaganda about FIFA’s history in which Tim Roth (Pulp Fiction, Reservoir Dogs) portrays Blatter. Imagine if Oakland A’s general manager Billy Beane shook down the city of Oakland for enough tax dollars to pay Brad Pitt’s salary for playing Beane in Moneyball—that’s what Roth playing Blatter looks like on a grander scale. Blatter is basically NFL Commissioner Roger Goodell, if he acted like a foreign dictator.
How did FIFA get this corrupt?
It all comes down to how FIFA is organized. Each of the 209 member nations gets a single vote when it comes to electing a federation President and executive committee. That means that the Maldives, Trinidad & Tobago, or Andorra have the same say in federation decisions as Brazil, Germany, or England. The smaller countries, and the (mostly) men who run their countries’ federations, also receive an equal cut of FIFA’s revenues—which means there’s no incentive for them to change any of the structure to the voting process.
Yeah, but shady sports organizations are everywhere. What about the International Olympic Committee? Hell, what about the NFL?
FIFA is uniquely positioned for this kind of epic legal takedown because the Justice Department kind of gets off on this heavy-lifting display of authority even outside American borders over the past decade. Also, it helps that Americans don’t really care about soccer.
Sure, soccer has been riding a growing wave of popularity, and the World Cup is now a more visible event, but it still lags behind many other sports in mainstream popular consciousness. Because of that, American culture just doesn’t revere soccer enough to consider FIFA sacrosanct. But consider the basketball version of this: let’s say FIBA, the world organization for basketball, decided to hold an international tournament in December that meant the NBA would have to suspend its season for a month. American superstars wouldn’t show up, the best team in the world wouldn’t be properly represented, and the world’s biggest TV market for the sport would be in open revolt against the event.
That’s essentially what FIFA is doing to European professional soccer leagues when it shifted the 2022 World Cup in Qatar to the winter. Because the rest of the world adores soccer so much, other prominent countries weren’t willing to take a stand for fear of backlash against its teams. The United States is just mediocre enough not to inspire the same reverence for the sport, which means the Justice Department cares more about the rampant financial corruption. Endemically American sports leagues—the NFL, NBA, MLB for instance—can get away with holding cities hostage for taxpayer money to rebuild stadiums, or locking out players to get a larger share of league revenue, because Americans care too much about seeing the sport to rise up against the shady business.
As for the IOC, countries are increasingly hesitant to even bid for the games because the data is so prevalent that the financial concessions are not worth the hassle. So many countries refused to enter or cancelled bids for the 2022 Winter Games that only two cities remain: Almaty, Kazakhstan and Beijing, China, which hosted the Summer Games in 2008. But the vast majority of Olympic sports aren’t as popular year-round as soccer, so the ire at the IOC hasn’t quite reached the same fever pitch.
So what happens now?
Well, Blatter released a statement saying FIFA “will continue to work with the relevant authorities…to root out any misconduct.” At best, this sounds insincere; at worst, it’s more of the same bald arrogance that took FIFA down this road. (Ironically enough, an vote is scheduled for later this week that would extend Blatter’s presidency to a fifth term.)
For the Justice Department, the next steps are to extradite those arrested back to the U.S. and enact harsh punishments that would serve as deterrents for future corruption. But it should be notes that the U.S. isn’t the only country rooting around; Swiss officials raided FIFA’s headquarters today as part of an investigation into how the 2018 and 2022 World Cups were awarded. And the clamor continues for FIFA to do something about the alleged human rights violations swirling around Qatar’s World Cup construction efforts.
Will any of this actually lead to change within FIFA?
Only time will tell. Still, Lynch and the Justice Department will keep coming—and once they’re through that door, other European authorities can’t be far behind.
Watch Video as Jon Stewart jumped on the FIFA-bashing bandwagon: