FIFA Scandal Live Updates

Department of Justice Details FIFA Indictments

Attorney General Loretta E. Lynch and other law enforcement officials held a news conference Wednesday morning in Brooklyn to unseal a 47-count indictment implicating top soccer officials and other sports executives in a 24-year scheme to enrich themselves through the corruption of international soccer.
The 161-page indictment refers to 25 unnamed and unindicted co-conspirators and an astoundingly intricate scheme of fraud, bribery and money laundering.
Several defendants “amassed significant personal fortunes” from bribes, the officials said. Four individuals, including Chuck Blazer, a former FIFA vice president, and two corporations have already entered guilty pleas.

“The next procedural step is extradition of those defendants who have not been arrested,” Lynch said.

FIFA Suspends 11; Blatter Speaks

FIFA has provisionally banned 11 people from all soccer activities after they were among those implicated in a corruption scandal.

“The charges are clearly related to football and are of such a serious nature that it was imperative to take swift and immediate action,” said Hans-Joachim Eckert, the chairman of the adjudicatory chamber of the FIFA ethics committee. “The proceedings will follow their course in line with the FIFA code of ethics.”

The banned individuals are: Jeffrey Webb, Eduardo Li, Julio Rocha, Costas Takkas, Jack Warner, Eugenio Figueredo, Rafael Esquivel, José Maria Marin, Nicolás Leoz, Chuck Blazer and Daryll Warner.

President Sepp Blatter also released a statement Wednesday afternoon, calling the accusations against some current and former officials “unfortunate” and “a difficult time for football.”

Blatter also said:

“Let me be clear: such misconduct has no place in football and we will ensure that those who engage in it are put out of the game. Following the events of today, the independent Ethics Committee – which is in the midst of its own proceedings regarding the awarding of the 2018 and 2022 FIFA World Cups – took swift action to provisionally ban those individuals named by the authorities from any football-related activities at the national and international level. These actions are on top of similar steps that FIFA has taken over the past year to exclude any members who violate our own Code of Ethics.

“We will continue to work with the relevant authorities and we will work vigorously within FIFA in order to root out any misconduct, to regain your trust and ensure that football worldwide is free from wrongdoing.”

UEFA Urges Postponement of FIFA Election

Officials from UEFA, soccer’s governing body for Europe, called Thursday’s arrests a “disaster for FIFA” in a statement and said they would meet Thursday to decide if they would boycott the remainder of this week’s FIFA Congress in Zurich.

The complete statement:

“Today’s events are a disaster for FIFA and tarnish the image of football as a whole.

“UEFA is deeply shocked and saddened by them.

“These events show, once again, that corruption is deeply rooted in FIFA’s culture.

“There is a need for the whole of FIFA to be “rebooted” and for a real reform to be carried out.

“The upcoming FIFA Congress risks to turn into a farce and therefore the European associations will have to consider carefully if they should even attend this Congress and caution a system, which, if it is not stopped, will ultimately kill football.

“The UEFA member associations are meeting tomorrow ahead of the FIFA Congress. At that point, the European associations will decide on what further steps need to be taken to protect the game of football.

“In the meantime, the members of the UEFA Executive Committee are convinced that there is a strong need for a change to the leadership of this FIFA and strongly believe that the FIFA Congress should be postponed, with new FIFA presidential elections to be organised within the next six months.”

UEFA’s call for a new election may not be not entirely altrusitic. Its president, the Frenchman Michel Platini, may be interested in running for the FIFA presidency. But he did not enter the race, which currently has only two candidates: the incumbent, Sepp Blatter, and Prince Ali bin Hussein of Jordan. Should FIFA agree to hold new elections, that could present an opening for Platini to enter — and perhaps win — the race for soccer’s top job.

Concacaf Statement

Concacaf, which had its president and several other current and former officials indicted, issued a statement on Wednesday afternoon:

“The Confederation of North, Central America and the Caribbean Association Football (CONCACAF) is deeply concerned by today’s developments, in the arrest of several international football officials including those belonging to our Confederation.

“The Confederation will continue to cooperate with the authorities to its fullest capacity.”

U.S. Governing Body Makes Statement

The U.S.S.F. has released a statement:

“The United States Soccer Federation firmly believes there is no higher priority, and nothing more important, than protecting the integrity of our game. We are committed to the highest ethical standards and business practices, and we will continue to encourage Concacaf and Fifa to promote the same values. Out of respect for the ongoing investigation, we will not speculate or comment further on this matter at this time.”

Match-Fixing Rears Its Head

Paraphrasing Currie: There is no information in our indictment that any games or competitions were influenced. Which is the logical next question when so much money is being passed around.

A Few More Bullet Points

A few more things worth noting:

The FIFA defendants face 20-year prison terms (maximum) on the racketeering charges.

The Qatar and Russia World Cups, subject to so much discussion and hand-wringing, are not in question in this indictment.

Prosecutors will look at whether financial institutions knew they were handling laundered money.

What About the Children?

First the red-card joke, now the lament that stolen money “could have gone to soccer balls for kids.”

Hitting all the prosecutorial favorites.

She’s Not the Only One

Lynch: “I think FIFA has a lot of soul-searching to do.”

Circle of Mistrust

Apropos of nothing: that Department of Justice seal behind Loretta Lynch could seat six if you put legs under it and made a table.

This Is Not Over

Our message, Currie says, is that our investigation will continue. He says what FIFA does “is up to them and their members.” But United States government will continue to pursue targets they uncover.

No Talk of Blatter

Officials have refused, several times, to address any person not named in the indictment. Somewhere in Zurich, a certain FIFA president quietly thanks them.

Insider Deals

Officials say 12 schemes were charged in the indictment. Nine of those were sports marketing schemes involving soccer tournaments.

Lynch said the selection of the United States as host for next year’s Copa America involved $110 million in bribes.

‘The Next Step Is Extradition’

Lynch: “The next procedural step is extradition of those defendants who have not been arrested.”

This would presumably include the former FIFA vice president Jack Warner, who issued a statement this morning that implied no one had even come looking for him yet.

Metaphorically Speaking

He couldn’t resist. Richard Weber, the head of the I.R.S. criminal investigation division: “This is the World Cup of fraud, and today we are issuing FIFA a red card.”

Big Money at Stake

Government investigators say they have uncovered, and will seek forfeiture of, more than $150 million in assets.

A Global Conspiracy

Today’s indictments hit hard on officials and executives working with Concacaf, the federation covering North and Central America and the Caribbean, and Conmebol, the governing body for South America. But officials from Europe and elsewhere just got a warning.

Acting United States Attorney Kelly T. Currie of the Eastern District of New York, noting that the bidding to host the 2010 World Cup in South Africa and the 2011 FIFA presidential election also came up in the investigation, says: “I want to be very clear: this is the beginning of our work, not the end.”

Guilty Pleas in the Bag

Lynch notes that four individuals and two corporations, both affiliates of the Traffic Group, have already entered guilty pleas. One of the individuals is Chuck Blazer, a former FIFA vice president and the one-time general secretary of Concacaf.

Lynch says these defendants have agreed to forfeit $150 million in profits as part of a settlement.

“Cesspit of Corruption”

Payoffs and a Painting

The 2013 Concacaf Gold Cup was also at the center of a bribery scheme, the indictment says. A Traffic USA executive had paid Webb $50,000 when Webb ran for Concacaf president in 2012. That Traffic executive — presumably, Enrique Sanz, who held the post but was not indicted — joined Concacaf as general secretary after Webb was elected president. Then the former Traffic executive began negotiating with his old boss, Aaron Davidson, at Traffic, and “negotiated a bribe payment for Webb.” In return, Traffic USA got the rights to the 2013 Gold Cup, which features national teams, and a contract for the Concacaf Champions League, a competition for clubs teams in the region.

A year later, that executive negotiated another bribe payment for Webb from Traffic USA to renew those contracts. The executive got a payoff, too: a painting from a New York art gallery, paid for by a Webb associate.

‘They Corrupted the World of Soccer’

Lynch: “They were expected to uphold the rules and keep soccer honest. Instead, they corrupted the world of soccer.”

But First, Politics

Lynch begins press conference pleading for an extension of the parts of the Patriot Act that are about to expire. Now back to soccer …

Hundreds of Thousands of Dollars, Paid Illicitly

Traffic then expanded its ambitions, with high-ranking executives committing bribery and fraud as they tried to get contracts from the various organizations in the region, including Concacaf, the Caribbean Football Union and others, in the 1990s and 2000s. Warner, Costa Rica’s Eduardo Li and Nicaragua’s Julio Rocha were all beneficiaries. The rights to the Concacaf Gold Cup, the regional championship that the United States and Mexico play in, was also a bribery target.

Other sports-marketing companies followed Traffic’s lead, frequently paying bribes to officials in exchange for media rights. Those included Torneos (run by Alejandro Burzaco), Full Play (run by Hugo and Mariano Jinkis) and two unnamed companies, including one operating out of New Jersey.

Jose Margulies, who ran two soccer-broadcasting companies, Valente and Somerton, moved millions between the officials and the sports-marketing companies over the course of the scheme. Careful and wary of being discovered, Margulies shredded his records; told soccer officials not to use accounts in their own name; and even used currency dealers to conceal the payments. Even as late as 2014 he offered to a new sports marketing company to facilitate a bribe payment. His charge for these services? A $150,000 annual fee and a two percent commission per payment.

Corruption and Cover-Ups

More from the indictment, via The Times’s Stephanie Clifford in Brooklyn:

Over their 25-year rise to power in the soccer world, prosecutors wrote, several defendants “amassed significant personal fortunes by defrauding the organizations they were chosen to serve” before being forced to resign from them. Other defendants, promising reform, instead “quickly engaged in the same unlawful practices that had enriched their predecessors.”

The former Concacaf president Jack Warner, for example, began to use his soccer-world power for personal gain in the early 1990s, the indictment says. He took bribes for things including the 1998 and 2010 World Cup selection, which he helped advise as a member of FIFA’s executive committee.

He routed official FIFA, Concacaf and Caribbean Football Union money into his own accounts, buying a Miami condominium with some of it.

Another top FIFA official, Nicolas Leoz of Paraguay, took bribes related to the Copa America, the South American championship tournament, from the founder and owner of the sports marketing company Traffic, which held worldwide commercial rights for the tournament from 1987 through 2011. Traffic’s chief executive paid tens of millions of dollars to Leoz and other Conmebol officials, the indictment said, and used offshore corporations to hide the payments.

An Intricate Scheme Worth Millions

The news conference is about to begin, but here’s a taste of what’s to come:

The 161-page indictment refers to 25 unnamed and unindicted co-conspirators, from FIFA officials to a South Africa World Cup bid committee official, suggesting that the people named today may be just the beginning of the government’s ongoing investigation.

The scheme outlined was astoundingly intricate: defendants named in the indictment committed fraud, bribery and money laundering, prosecutors wrote, for “personal and commercial gain.” They then covered up those payments in a variety of ways: creating fake consulting contracts to funnel illegal payments; sending money through associates working in banking or currency dealing; creating shell companies in tax havens; hiding the existence of foreign bank accounts; “bulk cash smuggling”; using safe-deposit boxes; and other means.

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