Wednesday, July 30, 2008

More scandal in soccer

Anyone who thinks Sepp Blatter and FIFA have any integrity left needs to read Andrew Jennings' story today in the Daily Telegraph about how a Swiss court recently ruled that FIFA had made attempts to deceive detectives investigating the missing $45 million embezzled by ISL, FIFA's former marketing agency, and forced them to pay some $57,000 in court costs as a result.

As Jennings writes, "In an extraordinary decision, three judges in Zug hearing a fraud trial into the collapse of Fifa’s former marketing partner, ISL, ruled earlier this month that football’s governing body 'knew more than they told investigators', that their behaviour “was not always in good faith”, and some of their claims 'were not credible.'"

That's pretty significant. FIFA's defence in the whole ISL case was that they didn't find out about the missing money and the kickbacks to top officials until it was too late, even though there was compelling evidence to the contrary. With this ruling, it's shown pretty clearly that the court is certainly skeptical of those claims and that FIFA likely made efforts to impede the investigation. An excellent overview of the case is provided in Jennings' article, and more detail can be found in his great book, but basically, it comes down to ISL running World Cup marketing for decades and paying massive kickbacks to FIFA officials for the right to do so. A solid backgrounder with plenty of detail can be found on the Sport Journalists' Association newsblog, where they relate a speech Jennings gave on the topic to the Play The Game international journalism conference in 2007.

On the court case itself: as a related story from The Canadian Press shows, some of the charges against the ISL executives didn't stick. However, one key figure, Jean-Marie Weber, was convicted of embezzlement. Weber has close ties to FIFA head Sepp Blatter, as related in this article from German news magazine Der Spiegel.

"The investigators are convinced that the money was then transferred from these entities to corrupt officials. But the traces have been wiped clean. Prosecutors believe at least one man knows the names of the beneficiaries, but he's the principal defendant in the trial: 65-year-old Jean-Marie Weber, the former vice-president of the ISMM supervisory board.
During the hearings, Weber behaved like Helmut Kohl, the former German chancellor and chairman of the conservative Christian Democratic Union (CDU), when confronted with charges of illegal party contributions. He kept his secrets to himself. The payments, Weber said under oath, were "confidential" and he intended to respect this "principle of confidentiality." Weber mentioned "commissions" and "fees" which had been paid "in parallel to the purchase or sale of rights."
An attorney from the small Swiss city of Baar described to investigators how silently Weber operated. The attorney had managed the almost six million francs that had been transferred from the Sunbow Foundation to Sicuretta, one of the front companies, in eight separate payments. The attorney said that he had withdrawn the entire sum in cash each time and turned it over to Jean-Marie Weber -- without getting a receipt.
According to the attorney, the money had been earmarked "for the acquisition of rights." The attorney was part of the network. Weber had invited him to attend a match at the football World Cup in Paris in 1998, where he introduced him to the freshly elected FIFA president, Joseph Blatter.
Weber and Blatter have known each other since the 1970s, when both men worked closely with former Adidas CEO Horst Dassler at the German company's corporate branch in the Alsace region of France. Blatter was the technical director of FIFA, Weber was Dassler's personal assistant. Dassler recognized early on how much untapped marketing potential big sporting competitions had for his company. And because he had always enjoyed the best of relations with FIFA officials and the International Olympic Committee, Dassler founded the ISL agency in 1982. He was soon merchandising for both the World Cup and the Olympic Games.
his pioneering phase was probably the period when Jean-Marie Weber learned the art of bribery. The ISL agency's rapid rise to the position of global industry leader, followed by its bankruptcy after 20 years (which ended when ISMM acquired it), apparently went hand in hand with lavish bribery budgets from the very start. One defendant told investigators that since its founding ISL had been involved in the "preferential treatment of important personalities in sports to promote its sports policy and economic goals."
After the early death of Adidas' Horst Dassler in 1987, according to the documents, Jean-Marie Weber took over the job of "cultivating relationships." The Alsace native, who was working without a written employment contract and for whom, at the time of the ISMM bankruptcy, a "base annual salary" of 870,000 Swiss francs had been negotiated, became one of the most mysterious figures in the business of international sports. He was dubbed "the man with the black list" in the industry.
Weber emulated Dassler, his role model. He used Sports Holding AG as a hub for "all sorts of payments that were dangerous from a tax perspective." The investigators learned of this through an attorney who was familiar with the internal procedures."

Hmm... so Blatter's buddy has been sent up the river for embezzlement, and there's convincing testimony implicating Blatter himself from former FIFA finance director Urs Linsi and former FIFA general secretary Michel Zen-Ruffinen. Yet, this is barely drawing any attention in the press, and most of the articles that mention it just briefly talk about FIFA having to pay court costs, with no discussion of the damaging testimony or the implications of this whatsoever. We all know there's plenty of sports scandals, but in my mind, this is the most significant: even the Donaghy case [The Associated Press via The Globe and Mail] didn't directly implicate David Stern? Is it any surprise that Blatter's choosing this week to sound off about "modern slavery" [Matt Lawless, The Daily Telegraph], domestic player development and his ridiculous 6+5 rule [ ], Cristiano Ronaldo [Jack Bell, The New York Times], the Olympics [CBC Sports], and everything else? I see a smokescreen, and the sad thing is, it appears to be working: plenty of people are happy to report on Blatter's various verbal fumblings, but the deeper scandal is going without a lot of coverage.

1 comment:

  1. This is a sad example of how Sepp had maintained his position of power and influence for so long. Once he gets in a little hot water, he says a few outlandish things that distract everyone.
    And as you pointed out, it works.
    Hopefully he gets his due one day.