Tensions rise as money-hungry side of FIFA’s corruption revealed
The Federation Internationale de Football Association, better known as FIFA, has long faced allegations of widespread corruption that have significantly tarnished the organization’s public image. However, the most recent accusations which have surfaced during the tenure of recently-banned President Sepp Blatter threaten far greater repercussions, as many of the organization’s top sponsors forewarn the withdrawal of their allegiance.
The culture of misconduct under Blatter’s rule can be traced back to his very own election as president of FIFA. While serving as the top deputy to then President João Havelange, it was rumored that a network of widespread bribery was established to help Blatter edge fierce competition during the 1998 election. For years, many accounts of exploitation garnered little-to-no penalty, as FIFA lacked concrete ethical guidelines.
Even as FIFA officially adopted a code of ethics in 2004, it did little to discourage and punish perpetrators from extorting large sums of money from the organization. In fact, when Jack Warner, former president of Trinidad and Tobago’s soccer federation, was accused of illegally selling tickets to the 2006 World Cup in Germany for $1.17 million in personal profit, FIFA worked swiftly to exonerate him.
Furthermore, as Blatter continued uninterrupted for a third presidential term, fraudulency reached profound levels as countries competed to host the upcoming 2018 and 2022 World Cups. Critics immediately remarked that deciding both host-countries at once was yet another instance of malfeasance promoted by Blatter: large-scale bribes were established between the winning countries of Russia and Qatar to ensure that they would vote for one another.
The saga of misrepresentation during Blatter’s tenure reached a climax on May 27 of this year, as the FBI alongside other agencies, including Brooklyn federal prosecutors, conducted a sweep of many top-ranking FIFA officials for crimes committed as far back as a decade ago. In Zurich, Switzerland, home of FIFA’s headquarters, accused officials hid their faces with a bed sheet as they exited the Baur au Lac hotel. Meanwhile, official documentation and electronic data were retrieved from FIFA headquarters and other facilities.
Ultimately, the unraveling crimes of officials under Blatter have forced him to announce his own resignation as soon as a new president is elected. However, the next scheduled meeting for participants to vote is in May of the following year. In the meantime, many of FIFA’s top sponsors have grown impatient and have demanded Blatter’s immediate withdrawal.
FIFA collects approximately $1.6 billion dollars annually from its sponsors. Companies including McDonald’s, Visa, Coca-Cola and Adidas allocate millions in contracts with FIFA in exchange for marketing rights that allow them to sell or advertise their brand throughout most of the organization’s scheduled soccer matches.
Upon news of the latest government crackdown regarding corruption in FIFA, many of its sponsors, especially Visa, which is under contract for an 85-million-pound annual sponsorship, have placed an ultimatum in which they will rescind their agreements barring tremendous reform throughout FIFA. The defensive move is spurred by the company’s eagerness to defend its own image and integrity, as FIFA’s sponsors stand to lose approximately $1 billion in their own brand value according to Brand Finance, an intangible asset valuation consultancy. Hyundai, the car-manufacturing giant, reinforced these sentiments in a statement that said the company was concerned about the legal proceeding taking place against FIFA executives. The company stated that it will keep a close watch on the situation as it proceeds.
Not surprisingly, the only sponsor that maintained its support of FIFA is Gazprom, the world’s largest extractor of natural gas and a company based in Russia, host country of the 2018 World Cup. However, even Russia may stand to lose billions of dollars since the next FIFA president can hold a new election to determine which host countries have been fairly selected.
Beyond the corruption of Blatter’s presidential campaign, accusations of extortion recently surfaced elsewhere in the realm of international soccer. Three of Barcelona Football Club’s superstar players, Neymar da Silva Santos Júnior, Lionel Messi and Javier Mascherano have all been brought up on tax evasion charges. On Sep. 25, a Brazilian court froze nearly $50 million of Neymar’s assets and later seized his car as officials continued their investigation. Meanwhile, Messi, an international football icon, is facing allegations that his father suppressed portions of the player’s actual income by smuggling it along with foreign sponsorship deals. Messi initially claimed his own ignorance led to the discrepancy in stated incomes, and while the court initially dropped the charges, recent findings encouraged it to pursue the case once again. Similarly, Mascherano allegedly withheld 1.5 million euros in earnings by adding them to his sponsorship earnings from Nike.