Note: In the 17th installment of our series, the ACAMS moneylaundering.com legal team examines the latest in how criminals and corrupt politicians abuse professional soccer to generate and mask illicit proceeds.
On May 27, 2015, the U.S. Justice Department charged 14 individuals, including former high-ranking officials with the Federation Internationale de Football Association, with bribery, money laundering and racketeering for their roles in a global scandal centered on professional soccer.
The FIFA corruption scheme lasted 24 years, saw hundreds of millions of dollars in bribes and kickbacks paid, and featured the use of shell companies, numbered offshore accounts, intermediaries and complicit bankers to launder the funds in question.
U.S. prosecutors announced charges against another 16 individuals in December 2015, seven months after the first round of indictments. The scandal has spurred several, parallel investigations in Australia, Colombia, Switzerland and elsewhere, with inquiries also targeting banks and financial professionals suspected of enabling the scheme.
On June 15, 2017, Jorge Arzuaga, a former private banker at Credit Suisse and Julius Baer, pleaded guilty to conspiring to launder money after facilitating $25 million in bribe payments in “a variety of ways,” including by forging documents, forming companies and masking illicit wire transfers.
Nearly three years later, on April 30 2020, Israel’s Bank Hapoalim agreed to pay more than $40 million to the Justice Department for helping clients send $20 million in bribes to FIFA officials over a five-year period. Bank employees also helped Luis Bedoya, a former soccer official in Colombia, launder funds.
Governments, researchers and others have published several warnings and reports both before and after the scandal with the aim of curbing corruption in soccer.
In a July 2009 report, the Financial Action Task Force described a scheme in which a Mexican businessman with ties to government officials bought a local soccer team. He then invited corrupt politicians to team matches to gain their influence and help his business secure public contracts.
Ten years later, the European Commission advised member states in a money laundering threat assessment to consider placing suspicious transaction reporting requirements on the sector to help curb the industry’s “lack of transparency” and often unexplainable source of funds.
The assessment came five years after Queen’s University Belfast warned that organized crime groups have infiltrated professional soccer to launder funds by sponsoring or buying soccer teams.
The EU’s law enforcement agency, Europol, released a more comprehensive study this month linking crime syndicates in Asia, Europe and Russia to match fixing and illicit gambling through soccer, and estimated that these groups rake in around $140 million each year as a result.
According to Europol, criminals sometimes place bets on fixed games to legitimatize small amounts of illicit cash while laundering larger sums through unregulated online-betting operators, then use cash couriers, legal entities, e-wallets and the traditional banking system to further move the funds.
But soccer-related criminal schemes keep emerging despite law enforcement’s attention.
On April 6, federal prosecutors in New York charged 16 individuals, some of which were previously charged in 2015, and Uruguayan sports marketing firm Full Play Group S.A. with money laundering in connection with the payment of bribes to corrupt officials.
FIFA disclosed in a July 30 statement that its current chief, Gianni Infantino, is under investigation in the organization’s home jurisdiction of Switzerland for allegedly engaging in corruption.
The organization’s previous chief, Issa Hayatou, was appointed on October 8, 2015, to serve on an interim basis following ex-President Sepp Blatter’s resignation and eventual ban for allegedly corrupt acts.
|Topics :||Anti-money laundering , Corruption/Bribery|
|Source:||Switzerland , U.S.: Department of Justice , U.S.: Courts , European Union|
|Document Date:||August 17, 2020|