United States law enforcement officials declared in forceful terms Wednesday that their broad investigation of FIFA had only begun and pledged to rid the international soccer organization of systemic corruption.
The Justice Department, FBI and IRS described soccer’s governing body in terms normally reserved for organized crime families and drug cartels, saying that top officials treated FIFA business decisions as chits to be traded for personal wealth. One soccer official took in more than $10 million in bribes, Attorney General Loretta Lynch said.
The schemes involving the fraud included the selection of South Africa as the host of the 2010 World Cup, the 2011 FIFA presidential elections and several sports-marketing deals.
“These individuals and organizations engaged in bribery to decide who would televise games, where the games would be held, and who would run the organization overseeing organized soccer worldwide,” said Lynch, who supervised the investigation from its earliest stages.
The Department of Justice indictment names 14 people on charges including racketeering, wire fraud and money laundering conspiracy. In addition to senior soccer officials, the indictment also named sports-marketing executives from the United States and South America who are accused of paying more than $150 million in bribes and kickbacks in exchange for media deals associated with major soccer tournaments.
The soccer officials charged are Eduardo Li, Jeffrey Webb, Eugenio Figueredo, Jack Warner, Julio Rocha, Costas Takkas, Rafael Esquivel, José Maria Marin and Nicolás Leoz.
The promise that the investigation would continue raised the specter of more arrests, but officials would not comment on whether they were investigating Sepp Blatter, the FIFA president and the man widely regarded as the most powerful person in sports. One federal law enforcement official said Blatter’s fate would “depend on where the investigation goes from here.”
“This is the beginning of our effort, not the end,” said Kelly T. Currie, acting U.S. attorney for the Eastern District of New York. Indeed, the indictment refers to 25 unnamed co-conspirators, from FIFA officials to a South Africa World Cup bid committee official. “We are looking into individuals and entities in a variety of countries,” said Currie, who noted that the investigation would look at financial institutions that handled the tainted money to see if they were cognizant of the fraud.
The government is pursuing a “very aggressive prosecutorial response in order to change behavior,” said James B. Comey, director of the FBI.
Some of the payments were funneled through intricate schemes. After committing fraud, bribery and money laundering, prosecutors wrote, defendants covered up those payments in various ways: using fake consulting contracts to funnel illegal payments; sending money through associates working in banking or currency dealing; creating shell companies in tax havens; hiding foreign bank accounts; using safe deposit boxes; and “bulk cash smuggling.”
And some payments were old-fashioned bribes, like one involving South Africa’s bid for the 2010 World Cup. Warner, then a member of the FIFA executive committee, directed an associate to fly to Paris, accept a briefcase full of cash in $10,000 stacks from a South African bid committee member in a hotel room, and return the briefcase to Warner in Trinidad.
Later, a Moroccan bid committee member offered Warner $1 million in exchange for his vote, but that person was outmaneuvered: the South African bid committee had arranged a $10 million bribe in exchange for the votes of Warner and two co-conspirators on South Africa’s behalf. All three ultimately voted for South Africa, the indictment says.
The plan involving the 2011 FIFA election also involved Warner. An unnamed co-conspirator, identified as “a high-ranking official at FIFA and AFC” who was running for FIFA president, reached out to Warner. The co-conspirator said he wanted to address soccer officials about his candidacy, and asked Warner to assemble those officials. The co-conspirator wired Warner $363,537.98.
At a May 2011 meeting that Warner called with Caribbean Football Union officials at the Hyatt Regency in Trinidad, the co-conspirator addressed the officials, then Warner told officials to pick up a “gift” in a certain conference room. The gift was $40,000 in cash, delivered in envelopes.
The next morning, Warner called Caribbean Football Union officials to another meeting, angered that one of the CFU officials had alerted CONCACAF to the payments. “There are some people here who think they are more pious than thou,” he said. “If you’re pious, open a church, friends. Our business is our business.”
Even facilitating the bribes was lucrative: José Margulies, who ran two soccer broadcasting companies, helped funnel money between officials and those seeking officials’ favor. He covered up his payments, shredding papers, telling soccer officials to use accounts that were not in their own name, and using currency dealers to hide the payments. His was apparently a lucrative job: in 2014, he offered to handle a bribe for a sports-marketing company he had not worked with before. His charge for his services: $150,000 annual fee and a 2 percent commission per payment.
Swiss authorities, working in conjunction with U.S. officials, conducted an extraordinary early morning operation in Zurich on Wednesday to arrest several top soccer officials and extradite them to the United States on federal corruption charges.
As leaders of FIFA gathered for their annual meeting, more than a dozen plainclothes Swiss law enforcement officials arrived unannounced at the Baur au Lac hotel, an elegant five-star property with views of the Alps and Lake Zurich. They went to the front desk to get room numbers and then proceeded upstairs.
The arrests were carried out peacefully. One FIFA official, Li, was led by the authorities from his room to a side-door exit of the hotel. He was allowed to bring his luggage, which was adorned with FIFA logos.
The charges, backed by an FBI investigation, allege widespread corruption in FIFA over the past two decades, involving bids for World Cups as well as marketing and broadcast deals.
Several hours after the soccer officials were apprehended at the hotel, Swiss authorities said that they had opened criminal cases related to the bids for the 2018 and 2022 World Cups — incidents that, more than any others, encapsulated FIFA’s unusual power dynamic.
“In the course of said proceedings,” the Swiss officials said, “electronic data and documents were seized today at FIFA’s head office in Zurich.”
The arrests were a startling blow to FIFA, a multibillion-dollar organization that governs the world’s most popular sport but has been plagued by accusations of bribery for decades.
The inquiry is also a major threat to Blatter, who has for years acted as a de facto head of state. Politicians, star players, national soccer officials and global corporations that want their brands attached to the sport have long genuflected before him.
An election, seemingly preordained to give Blatter a fifth term as president, is scheduled for Friday. A FIFA spokesman insisted at the news conference that Blatter was not involved in any alleged wrongdoing and that the election would go ahead as planned.
“FIFA welcomes actions that can help contribute to rooting out any wrongdoing in football,” the organization said in a prepared statement.