In separate investigations, both the Brooklyn U.S. Attorney’s office and New York’s top financial regulator, the Department of Financial Services, have questioned at least seven banks in the corruption scandal involving FIFA, the world’s soccer governing body. The banks in question are HSBC, Deutsche Bank, Barclays, Credit Suisse, Standard Chartered, Israel’s largest bank, Hapoalim, and New York-based Delta National Bank. Both offices are questioning why the banks’ internal money-laundering flags were not raised in the wake of the Justice Department’s May indictment of 14 FIFA officials in the game’s most significant corruption scandal. The news comes two weeks after Swiss authorities discovered evidence of money laundering revolving around the awarding of the 2018 and 2022 World Cups to Russia and Qatar respectively. Swiss police raided FIFA’s Zurich headquarters on May 27th, which led to the arrest of six officials on the premises, with at least one set for extradition to the U.S. to face charges.
Despite the heavy-handed indictment from the U.S. Justice Department, FIFA president Sepp Blatter was re-elected to his fifth term as president in May. Despite the victory, Blatter announced that he will resign following a February 26th 2016 special election, making the announcement just four days after his re-election. Former executive, Chuck Blazer was convicted on ten counts, including wire-fraud, racketeering, and money laundering, among other charges. Blazer, who has since been banned from any further national or international soccer activities, has become a lead informant for U.S. authorities. Blazer has admitted to taking bribes in conjunction with FIFA’s awarding of the 1998 World Cup to France and the 2010 World Cup to South Africa. Due to the scandal, the bidding process for the 2026 World Cup has been suspended indefinitely. The Justice Department’s indictment contained 47 counts, with U.S. attorneys claiming at least 24 years of “rampant, systemic, and deep-rooted” corruption. The department alleges that FIFA authorities have netted over $150 million in illegal payments during that time.
HSBC President, Rob Sherman responded to the inquiry in an e-mailed statement, saying “We are continuing to review the allegations in the indictments against certain FIFA executives and others, to ensure that our services are not being misused for financial crime.” Visa, a major FIFA sponsor, said they lacked confidence in the organization and requested that an independent commission help to reform the organization. The company’s CEO, Charlie Scharf said in a statement that FIFA, “continue to show its lack of awareness of the seriousness of the changes which are needed.” Scharf continued, “Two things need to happen to ensure credible reform. First, an independent, third-party commission led by one or more impartial leaders is critical to formulate reforms. Second, we believe no meaningful reform can be made under FIFA’s existing leadership.” The banks have been instructed to scour their records to locate evidence of money laundering. Failure to do so accurately may lead the banks themselves to become ensnared in the scandal themselves.
International Business Times – Clark Mindock
SI.com – Molly Geary
Yahoo Sports – AFP
Wall Street Journal – Christopher M. Matthews and Rachel Louise Ensign