Turmoil has engulfed FIFA, world soccer’s notoriously corrupt governing body, after a wave of international arrests of its top executives and the unsealing of a 47-count U.S. federal indictment based in the Eastern District of New York.
The arrests commenced early Wednesday morning led by Swiss authorities working in conjunction with U.S. law enforcement officials. At least 14 individuals were charged by prosecutors, with more charges possible after Swiss police seized records at FIFA’s headquarters in Zurich.
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The groundbreaking prosecution is the result of an American investigation that has been underway since at least 2011, and first described last November by the Daily News. The subject of that story, former FIFA executive Chuck Blazer, cooperated with the probe and on Wednesday was revealed to have pleaded guilty in 2013.
The charges in the sprawling case include wire fraud, money laundering and racketeering, and could lead to prison sentences and stiff fines. Those charged are accused of participating in a system of bribes and kickbacks that spanned decades and reportedly totaled $93 million in illicit payouts.
FIFA vowed Wednesday to cooperate with the investigation, saying “We are pleased to see that the investigation is being energetically pursued for the good of football and believe that it will help to reinforce measures that FIFA has already taken.”
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The individuals accused may be extradited to face federal prosecution in Brooklyn, where top federal officials are expected to detail the criminal charges Wednesday in a press conference led by new Attorney General Loretta Lynch. In Switzerland, where FIFA is based, authorities opened separate criminal proceedings relating to the awarding of hosting rights for the 2018 and 2022 World Cups, which were won by Russia and Qatar, respectively.
The FBI and IRS probe is now primed to explode into global view days before longtime FIFA boss Sepp Blatter is expected to be coronated for a fifth presidential term. Blatter was not among those arrested, according to sources familiar with the investigation.
Those charged include Trinidadian Jeffrey Webb, a vice president of FIFA and president of CONCACAF, one of six federations that compose FIFA; Jack Warner, former president of CONCACAF; Eduardo Li, president of the Costa Rican federation who was expected to join FIFA’s executive committee this week; Julio Rocha, president of the Nicaraguan federation; Costas Takkas, former president of the Cayman Islands federation; Eugenio Figueredo, former president of the South American federation and an outgoing FIFA vice president; Rafael Esquivel, president of the Venezuelan federation; Jose Maria Marin, former president of the Brazilian federation; and Nicolas Leoz, former president of Conmebol and a former member of the executive committee. Four other defendants are sports marketing executives Alejandro Burzaco, an Argentine sports media executive; Aaron Davidson, president of Traffic Sports USA and chairman of the North American Soccer League; and Hugo and Mariano Jinkis, soccer media executives. Also charged is former broadcast executive Jose Margulies.
Additionally, the government revealed Wednesday that along with Blazer, three other men had pleaded guilty to charges in the case. They are Darrell and Daryan Warner, two sons of indicted executive Jack Warner of Trinidad, along with Jose Hawilla, the owner and founder of a Brazilian sports marketing conglomerate central to the case.
“The indictment alleges corruption that is rampant, systemic, and deep-rooted both abroad and here in the United States,” Lynch said in a statement. “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. And it has profoundly harmed a multitude of victims, from the youth leagues and developing countries that should benefit from the revenue generated by the commercial rights these organizations hold, to the fans at home and throughout the world whose support for the game makes those rights valuable.”
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At Wednesday morning’s news conference at the U.S. Attorney’s Office in Brooklyn, Lynch, the former U.S. Attorney for the Eastern District, FBI director James Comey and IRS chief of criminal investigations Richard Weber are expected to outline the investigation, believed to have uncovered evidence of tax evasion, money laundering, racketeering and wire fraud. Their agencies led the U.S. arm of the investigation.
The probe took off in the aftermath of a 2010 vote by FIFA executives to award host nation rights for the 2018 and 2022 World Cup tournaments to Russia and Qatar, respectively. The United States had unsuccessfully bid for the 2022 tournament.
Soccer reporters converged on Zurich’s five-star Baur au Lac in time to witness the stunned reaction of FIFA’s leadership to reports that a soon-to-be-unsealed indictment will name top FIFA figures such as Webb, leader of CONCACAF, the regional soccer authority governing the U.S., the Caribbean and Central America, and the man who replaced Warner at that federation.
Blazer, CONCACAF’s former secretary general, cooperated extensively with the FBI and IRS after agents confronted him in 2011 with evidence of tax irregularities. Blazer was soon helping the agents understand FIFA’s infamous history of kickbacks.
Blatter, a 79-year-old Swiss, was not expected to be arrested, according to one source familiar with the investigation, although it was possible that more charges could come, including Blatter’s top loyalists and key power brokers within the opaque, unaccountable, and fabulously wealthy organization Blatter leads.
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The arrests came in the early morning hours Wednesday as officials slept in their rooms at the elegant Baur au Lac on Lake Zurich, preparing to gather ahead of the presidential election Friday. After FIFA’s 209 member nations cast their votes, the executive committee, known as the Ex-Co, was scheduled to meet Saturday at FIFA’s lavish headquarters in Zurich. Those arrested were expected to be extradited to the U.S. under treaties between the countries.
The News first reported last fall that the Eastern District was heading the investigation in the U.S. in cooperation with Swiss authorities and that Blazer secretly recorded his fellow soccer executives during the London Games in 2012, where he set up meetings with many of them, and in New York and other cities.
FIFA’s Ex-Co has been rocked by scandal in recent years, but Blatter has survived. His only challenger in Friday’s election is former FIFA vice president Prince Ali bin al Hussein of Jordan, who this week issued a statement saying “the self-serving policies and controversial leadership style of FIFA today have disempowered our national associations, hurt our sport and cost us our dignity.”
The arrests will likely throw the election into turmoil and could affect Blatter’s chances to be elected, or if he is elected, to serve out his term.
“Even if they can’t get Blatter on anything this time, just the hint of impending charges raises the question of how can you elect him,” said one source familiar with the corruption suspicions and allegations that have long swirled around the FIFA Ex-Co.
In the most recent claim of corruption, recent media reports say the election team behind bin al-Hussein has been in contact with the police after claiming it had been approached in April by a person who said he could deliver 47 votes at Friday’s election. According to The Guardian, the individual also offered to provide “what appeared to be illegally obtained” information relating to the financial activities of Blatter.
ESPN’s Jeremy Schaap reported this month that Blatter has declined to enter the U.S. since 2011, ostensibly for fear of possible arrest. Blatter’s avoidance of U.S. soil coincides with the time period when Blazer became a cooperating witness for the investigation.
Blazer, who has been seriously ill the last year and remains hospitalized in the New York area, is believed to have provided the feds with enough information into the shadowy financing of international soccer to keep Blatter out of the U.S., presumably aware that he could be pulled into the ongoing probe.
Blazer lived an extravagant lifestyle based at CONCACAF’s offices in Trump Tower, where for years he worked closely with Warner, his former friend and ally. Both Warner and Blazer were forced out of their CONCACAF roles in 2011, turning on each other amid a bribery scandal involving votes for the FIFA presidency, which Blatter won.
Soon after, pressure from the FBI and IRS led the once-corpulent Blazer to lend his heft to an investigation into the financing and politics of international soccer, going so far as to help the feds spy on his fellow sport executives at the London Games in 2012, using a tiny microphone hidden in the specially altered fob of his keychain. Blazer, who authorities believe amassed a fortune, much of which traveled through offshore bank accounts, was replaced on the FIFA executive committee in 2013.
Blazer’s cooperation is thought to have offered law enforcement a rare view of the shadowy deal-making that accompanies the bidding for rights to host FIFA’s World Cup tournament — an almost incalculably valuable privilege bestowed through the votes of FIFA’s executive committee.
The irregularities around the 2010 voting that decided the locales for the World Cup tournaments forced FIFA to open its doors to an ethics investigation by former U.S. Attorney Michael Garcia. Garcia ultimately resigned in protest after his two-year probe ran into the resistance of FIFA leaders to release the report publicly.
According to a source familiar with Blazer’s activities, Blatter became uncomfortable about visiting the U.S. as early as 2006, when a federal judge in New York ruled against FIFA in a lawsuit brought against the Switzerland-based organization by MasterCard.
In that case, Blatter asked Blazer to represent FIFA in the lawsuit for a simple reason:
“He’s afraid to come to the U.S.,” Blazer told the source.
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