ZURICH: The ISL report from FIFA’s ethics judge Hans-Joachim Eckert says that he has no power to act against individuals because taking bribes, in the 1990s, was not punishable by Swiss law and FIFA had no ethics system at all in those days.
Eckert says that “not inconsiderable amounts” of illicit payments were channelled to former FIFA president Havelange and to his son-in-law Ricardo Teixeira as well as to CONMEBOL president Nicolás Leoz.
The judge absolves current president Sepp Blatter of any suspicions over illicit payments but raises the issue of how much the then general secretary knew and whether he should have acted more decisively to protect FIFA’s interests.
Eckert says that work on the ISL issue began in July last year.
ISL had collapsed in 2001 but the delay had been enforced by a a confidentiality clause imposed during a settlement with FIFA over illicit payments which had been made to Brazilians Havelange and Teixeira.
Garcia passed on to Eckert his own report and conclusions and the relevant paperwork on March 20 under the terms of the FIFA Code of Ethics.
However, Eckert notes crucially that before 2004 FIFA had “no ethics rules whatsoever” and thus the current code’s disciplinary powers were irrelevant.
Garcia’s report spanned 30 pages but the full file, with documentation and witness statements – including an interview with FIFA president Sepp Blatter and then CONMEBOL president Nicolas Leoz – comprised more than 4,200 pages.
Eckert reviews FIFA’s legal status and the role played by ISL and its parent company ISMM as commercial partners but also the creation of a Liechtenstein company which distributed monies “to certain ‘beneficiaries’.”
Eckert says: “The money was meant for commissions, fees, finders-fees or additional acquisition payments and for ‘contributions to personalities and decision-makers in world sport.’”
Hence ISL “had already made preparations . . . to cover up the expected payments and the cash flows, and thus to be able to direct unauthorised payments, via a network of companies and bank accounts.”
ISMM had guaranteed payments to FIFA of SwFr650m for the award of the commercial rights for the 2002 World Cup and SwFr750m for the 2006 World Cup.
However: “Criminal structures within the ISMM/ISL Group started to circumvent the originally clear agreement with FIFA. The conduct of the responsible parties at ISMM/ISL and of the other subsidiaries and affiliates involved is to be seen as typical of a creative mixture of legal, i.e. contractually admissible activity, and deliberately fraudulent and disloyal conduct.”
Eckert adds: “Not inconsiderable amounts were channelled to former FIFA president Havelange and to his son-in-law Ricardo Teixeira as well as to Dr Nicolás Leoz, whereby there is no indication that any form of service was given in return by them.
“These payments were apparently made via front companies in order to cover up the true recipient and are to be qualified as ‘commissions’ known today as ‘bribes’.”
The practice stretched further back. Eckert says such payments were first recognisable in 1992. These were not punishable as bribes under Swiss criminal law at that time.
However, Eckert adds: “Havelange and Teixeira, as football officials, should not have accepted any bribe money, and should have had to pay it back since the money was in connection with the exploitation of media rights.
“This does not change anything with regard to the morally and ethically reproachable conduct of both persons.”
All these payments preceded the introduction of a FIFA ethics code and thus none of the ‘guilty’ were doing anything strictly illegal from a sports administration point of view.
Leoz had claimed that all of the money he received from ISL was donated by him to a school project, but only in January 2008 – eight years after he received it.
In any case, says Eckert: “Dr Leoz was not fully candid with the FIFA executive committee in a meeting held in December 2010 and with Michael J. Garcia when interviewed in this examination.”
Leoz resigned on April 24 from the FIFA executive committee as well as from his role as president of CONMEBOL, the South American confederation.
Eckert then turns to the activities of FIFA’s own management which was headed, during the ISL years, by general secretary Sepp Blatter, now the organisation’s president.
Eckert says that FIFA reacted properly and correctly to the bankruptcy of ISL and even initiated legal action in pursuit of monies owed. However, as a result of that action, the examining magistrate’s Office in Zug launched a counter-claim against “persons unknown on account of disloyal management to the detriment of FIFA.”
Reviewing Blatter’s conduct, Eckert says: “There are no indications that Blatter received any commission payments from ISL [and] there are also no indications whatsoever that Blatter was responsible for a cash flow to Havelange, Teixeira or Leoz, or that that he himself received any payments from the ISL Group, even in the form of hidden kickback payments.”
Critically, however, Eckert says: “It must be questioned, however, whether Blatter knew or should have known over the years before the bankruptcy of ISL that ISL had made payments (bribes) to other FIFA officials.”
Eckert refers, in this context, to a payment to Havelange which was misdirected and had been brought to Blatter’s personal attention by the chief accountant. Blatter had returned the cheque but Eckert thought his conduct “may have been clumsy.”
Eckert also noted here “the refusal of certain former employees to give information to Mr Garcia,” and recommended that future contracts of employment should stipulate an ongoing duty to cooperate with the investigatory chamber even after termination of employment.
A settlement was concluded with the Zug court and “it seems obvious that the then highest officials at FIFA would have been involved in these negotiations and all the more so since a kind of final line could then be drawn with regard to the transgressions of Teixeira and Havelange, and in fact all football officials, whereby these persons had to repay to ISL part of the bribes they had received.”
Conficts of interest
However Eckert notes that some issues remain “in the dark” because of an apparent conflict of interest over whether some of the lawyers involved were acting for individuals or FIFA.
Eckert thus concludes:
1, The ISL case is concluded for the Ethics Committee;
2, I note that Mr. Havelange resigned from his position as Honorary President effective from 18.04.2013 and that Dr. Nicolás Leoz resigned from his positions as a FIFA Executive Committee member, as a FIFA standing committee member and as CONMEBOL President effective from 24.04.2013. Hence, any further steps or suggestions are superfluous; and
3, No further proceedings related to the ISL matter are warranted against any other football official.