CMMD Perspectives — FIFA Officials Face Corruption Charges

Some top FIFA officials were indicted for corruption charges, and proceedings have been initiated for extradition to the United States from Zurich, Switzerland on Wednesday 27 May. The officials were peacefully removed early Wednesday morning from a Zurich hotel where they had gathered in preparation for a FIFA annual meeting. Fourteen people were named on the US indictment for charges of racketeering, wire fraud and money laundering among other things. The officials are alleged to have been involved in two decades of corruption involving bids for World Cup hosting, marketing and broadcasting deals. Sports marketing executives from the United States and South America have also been accused of bribery to the degree of over 100 million dollars and are expected to be added to the indictment. The charges are backed by an FBI investigation, and a parallel but separate investigation of the FIFA decisions regarding the hosting of the 2018 and 2022 World Cups has been announced by Swiss authorities.   

US interests are related to a longer history of corruption charges launched under the leadership of the new US Attorney General Loretta Lynch.  FIFA had already been criticized by many for the working conditions and pay of the workers building the stadiums in preparation for the World Cup in Qatar in 2022. The International Trade Union Confederation (ITUC) has been especially critical of the working conditions, based largely on alleged exploitation of migrant workers.  The work on the stadiums, which started over 2 years ago has already claimed hundreds of lives, lives lost it seems to bad working conditions and accidents. FIFA also already faced criticism for not being very transparent on that issue.  This is likely to come up during the International Labour Conference, meeting in Geneva from 1 to 11 June 2015, at a special side event on labour migration scheduled for Friday, 5 June 2015.

Sepp Blatter, newly re-elected FIFA President, was not among those indicted and has said that he does not fear arrest. He said he was shocked by the US judicial system with regards to the indictment and called for a ‘hate’ campaign by European soccer officials. The public seems to favor that Blatter should be fired or step down from his position in FIFA, and the media expressed surprise when Blatter actually did announce plans to step down at a press conference on 2 June 2015.  Prince William is among those that criticized FIFA for corruption in a speech he gave on Saturday. Sepp has promised greater transparency from now on.

Major sponsors of the World Cup, many of which are US multinationals, have started to warn they may jump ship as a result of the allegations. Nike and Emirates Airline late last year had decided not to renew sponsorships for the FIFA World Cup due to lack of transparency on the bidding process. They had been two of FIFA’s major sponsors for the world cup. More recently Castrol, Continental Tyres and Johnson & Johnson also said they won’t be renewing deals with FIFA in January. The allegations and scandals surrounding FIFA certainly don’t look good for the sponsors and VISA, one of the major sponsors that is currently still on board, has threatened to jump ship as well.

FIFA had talked about moving the dates from the typical late June to early July time period to later in the year to avoid the scorching heat of summer in Qatar. It was suggested that the tournament be held in November and December but it is unclear when the official dates will be. FIFA has also received threats from ISIS which has said that unless they cancel the event, ISIS would bomb it. It would seem that cancellation may not be that out of the question considering where FIFA finds itself currently. Additionally, just when it would seem that the story couldn’t get any worse for FIFA, one of the officials posted a defensive video saying that the Americans are just trying to take the bid for the World Cup citing a headline from the Onion, a satirical online magazine.

 From the CMMD Geneva Observer 1 June 2015

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