Four sports marketing executives and a broadcaster from the U.S. and South America were charged with racketeering, wire fraud and money laundering conspiracies along with nine leaders of Fédération Internationale de Football Association (FIFA), soccer’s governing body, in a 47-count indictment unsealed early this morning. Many of the defendants were rounded up in a luxury hotel in Zurich, Switzerland, where they were gathered for FIFA’s annual meeting.
The defendants will be extradited to the U.S. for trial in the Eastern District of New York (Brooklyn). Newly appointed U.S. Attorney General Loretta Lynch, who was formerly the U.S. Attorney for the Eastern District, will lead a press conference detailing the corruption charges, which allegedly took place over 24 years, at 10:30 a.m. this morning.
“The indictment alleges corruption that is rampant, systemic, and deep-rooted both abroad and here in the United States,” Lynch said in a news release. “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.”
Much of the inquiry involves the Confederation of North, Central America and Caribbean Association Football (CONCACAF), one of the six regions in FIFA, Matt Apuzzo, Michael S. Schmidt, William K. Rashbaum and Sam Borden report in the New York Times in a story cited by media organizations around the world.
“According to the indictment, several international soccer events were tainted by bribes and kickbacks involving media and marketing rights: World Cup qualifiers in the CONCACAF region; the Gold Cup, a regional championship tournament; the CONCACAF Champions League; the Copa América; and the South American club championship, the Copa Libertadores,” they write. “The indictment also claims that bribes and kickbacks were found in connection with the selection of the host country for the 2010 World Cup,” which was South Africa.
“The bribery suspects — representatives of sports media and sports promotion firms — are alleged to have been involved in schemes to make payments to the soccer functionaries — delegates of FIFA and other functionaries of FIFA sub-organizations — totaling more than $100 million,” writes Ali Gordon in the Belfast Telegraph. “In return, it is believed that they received media, marketing, and sponsorship rights in connection with soccer tournaments in Latin America.”
The U.S. is claiming jurisdiction because the crimes were allegedly hatched and agreed to in this country and were carried out using U.S. banks.
The four indicted sports marketing executives are:
Broadcaster José Margulies, controlling principal of Valente Corp. and Somerton Ltd., allegedly served as an intermediary to facilitate illicit payments between sports marketing executives and soccer officials, according to the indictment.
In addition, four men previously pleaded guilty to charges — under seal — and cooperated with the investigation. They are Daryll Warner, Daryan Warner, José Hawilla and Charles Blazer. And, on May 15, Miami-based Traffic Sports USA Inc. and Traffic Sports International Inc. pleaded guilty to wire fraud conspiracy, according to the release. Their website was not available this morning.
Blazer is a truly “larger-than-life” figure and “former Westchester soccer dad,” according to an investigation by the New York Daily News published last November, who used a microphone embedded in a keychain to surreptitiously gather recordings of former colleagues for FBI and IRS investigators.
“Once the sport’s No. 1 powerbroker in the United States, [Blazer] is alleged to have collected untold millions during his 20-year reign — running up a staggering $29 million in credit card charges to help fuel his extravagant lifestyle, which included a pricey Trump Tower apartment for his cats,” wrote Teri Thompson, Mary Papenfuss, Christian Red and Nathaniel Vinton.
FIFA VP and CONCACAF president Jeffrey Webb and former FIFA VP Jack Warner were among the soccer officials who were indicted. Sepp Blattner, the president of FIFA who is scheduled to seek a fifth term on Friday, was not charged. “He is not involved at all,” FIFA spokesman Walter de Gregorio told the AP.