Subscribe to our FinCrimes Update for news about the Foreign Corrupt Practices Act and related prosecutions and enforcement actions.
After months of speculation about potential legal ramifications for FIFA President Joseph ("Sepp") Blatter, the Office of the Attorney General of Switzerland announced that Mr. Blatter is the subject of criminal proceedings in that country. The allegations include criminal mismanagement related to a contract with the Caribbean Football Union that was purportedly against the interests of FIFA, as well as misappropriation related to a payment to the President of the Union of European Football Associations (UEFA). The Office of the Attorney General also reported that Mr. Blatter was interrogated and his offices were searched. Previous FCPA Scorecard coverage of this investigation can be found here.
On September 14, U.S. Attorney General Loretta Lynch announced that the DOJ is expanding its FIFA investigation to pursue additional charges against individuals and companies. AG Lynch made these comments at a press conference in Zurich with Switzerlands Attorney General, Michael Lauber. The DOJ has been working closely with Swiss officials in its investigation, and has charged 14 FIFA officials with racketeering, wire fraud, and money laundering. Additionally, on September 17, the Swiss Federal Office of Justice approved the extradition of Eugenio Figueredo, a former vice president of the South American Football Confederation and former vice president of FIFA, to the United States. Figueredo was one of seven defendants fighting extradition from Switzerland. In July, Jeffrey Webb, a former vice president of FIFA, agreed to be extradited to the United States, but the remaining five defendants are awaiting decisions on extradition. Previous FCPA Scorecard coverage of this investigation can be found here.
Although not yet confirmed by the SEC, media reports suggest that the SEC has opened several investigations of publicly traded companies who contracted with FIFA. Indictments in the FIFA cases have alleged that certain companies paid kickbacks to officials of FIFA and related organizations in order to win marketing and apparel contracts. The specific companies targeted in the SECs new probe have not yet been named. Without the apparent involvement of a foreign official in the FIFA cases, presumably the SEC will be focusing on the books and records and internal controls provisions of the FCPA, along with other potential violations. Previous FCPA Scorecard coverage of this investigation can be found here.
On July 15, after 50 days of detention, a high-ranking FIFA official widely reported to be former FIFA Vice President Jeffrey Webb was extradited from Switzerland to the United States. Webb ultimately agreed to be extradited despite initially contesting his extradition at a hearing following his arrest. Six other FIFA officials arrested in connection with DOJS corruption investigation are continuing to fight extradition. The Swiss Federal Office of Justice is overseeing the extradition proceedings. All seven officials were formally indicted by the DOJ on May 27. Previous FCPA Scorecard coverage of this investigation can be found here.
On July 1, the United States formally requested the extradition of seven FIFA officials associated with DOJ's ongoing corruption investigation. These extradition requests were submitted to Switzerland's Federal Office of Justice ("FOJ") and were based on allegations of criminal activity conducted in the United States. These seven officials were formally indicted by the DOJ on May 27. With the formal extradition requests submitted, the Zurich Cantonal Police, acting for the FOJ, will oversee hearings on the extradition requests. According to Swiss officials, the FOJ will rule on the extradition requests within a few weeks. Once the FOJ rules on the requests, the ruling may be challenged before the Federal Criminal Court and ultimately the Federal Supreme Court, a process that could take months. Despite the potential delays, Swiss officials have stated that the officials will not be granted bail because they are considered flight risks. Previous FCPA Scorecard coverage of this investigation can be found here and here.
On June 15, the U.S. District Court for the Southern District of New York unsealed a 2013 plea agreement under which American FIFA Executive Committee Member Chuck Blazer secretly pleaded guilty to ten charges related to corruption in the soccer organization. Mr. Blazer agreed to forfeit more than $1.9 million, and to pay back-taxes and penalties on more than $11 million in unreported income. According to the plea agreement, Mr. Blazer began cooperating with the DOJs investigation in December of 2011, even agreeing to work undercover making secret recordings. The unsealing of the plea agreement is the latest development in the ongoing fallout from the racketeering, wire fraud, and money laundering indictments announced three weeks ago by the DOJ against soccer executives at FIFA and others tied to the organization. Mr. Blazers testimony at his plea hearing in November 2013 was unsealed two weeks ago.
FIFA Investigation Updates: President Resigns Amidst Corruption Probe; Interpol Issues Red Notices for Six
On June 2, continuing the fallout from the racketeering, wire fraud, and money laundering indictments announced last week by DOJ against soccer executives at FIFA and others tied to the organization, FIFA President Sepp Blatter announced his resignation, less than a week after being re-elected to lead soccer’s governing body. It has been reported that Mr. Blatter is the focus of the same federal corruption investigation. Blatter’s announcement was a reversal from his remarks after winning re-election, stating then “Why would I step down? … That would mean I recognize that I did wrong.”
One day after Blatter’s announcement, Interpol issued Red Notices for six individuals linked to the FIFA corruption investigation, including for two former FIFA officials. The two former FIFA executives, Jack Warner, a Trinidad & Tobago national and former FIFA vice president and executive committee member, and Nicolás Leoz, a Paraguayan national and former FIFA executive committee member, have been arrested in their home countries. The other four Red Notices, which alert Interpol’s member nations that arrest warrants have been issued by a judicial authority (here, the United States) and seek the location and arrest of wanted persons with a view to extradition, were issued for four South American nationals and corporate executives.
The DOJ on May 27 unveiled indictments in one of the most sprawling, long-running alleged corruption rings in recent decades, charging nine executives of FIFA or related soccer governing bodies, as well as five sports marketing or broadcast executives, with racketeering, wire fraud, and money laundering. The defendants were charged with offering and accepting over $150 million in bribes and kickbacks over a 24-year period related to the media and marketing rights for soccer tournaments. In addition, the DOJ unsealed guilty pleas previously entered by four individual and two corporate defendants. Seven of the defendants were arrested in Switzerland as a result of U.S. arrest warrants, pending extradition, continuing the trend of international cooperation between U.S. and foreign anti-corruption enforcement agencies. Continuing a different trend, one of the individuals who pleaded guilty was a former FIFA executive who acted as an informer for the DOJ, including by taping key conversations. While the indictment mainly concerned media and marketing rights, at least one reference was made to alleged bribes related to voting for World Cup host countries, and the Swiss government announced an inquiry into the awarding of the 2018 and 2022 World Cups. Additional charges appear likely to be brought in the future, whether by the U.S. or other jurisdictions. The U.S.s jurisdiction to bring the charges is also likely to be challenged.
- Buckley Webcast: Community Reinvestment Act modernization – For real this time?
- Jeremiah Buckley to moderate the discussion “CFPB’s new approach to discrimination: Invoking UDAAP” at an American University Washington College of Law Symposium
- Benjamin W. Hutten to discuss “Latest on AML regulations and impact of economic sanctions” at a Mortgage Bankers Association webinar