FIFA Executives Avoided Conflict for Years While Some Took Bribes

Updated on

FIFA officials and staff spent years avoiding conflict, using a culture of favor-swapping to create a governance model resembling a cozy private club, say executives of national soccer organizations and sports groups that dealt with the body now battered by a corruption scandal.

Six current and former executives, including Cayman Islands banker Jeffrey Webb, were accused by U.S. prosecutors of crimes including bribery, racketeering and money laundering last month, prompting FIFA President Sepp Blatter to announce plans to step down. Chuck Blazer, one of the six, said executives received bribes to vote on the 1998 and 2010 World Cup hosts, according to testimony released by a New York court last week.

FIFA officials get their seats by virtue of the power within the respective regional confederations. That’s not the way to run an organization that generates as much as $5 billion from each World Cup, according to Zico, the former Brazil star who helped organized the 2014 tournament.

The system “is all about exchanging favors,” Zico said in an interview. “When you come into soccer politics, you have to repay the person who invited you.”

Five-Star Hotels

The 24-person executive board meets about five times a year in a soundproof basement of FIFA’s glass-fronted headquarters on a hilltop in Zurich. They fly in from different parts of the world, stay in five-star hotels and rule on everything from the dates of the World Cup to the regulations of the sport. For their work, they receive a $300,000 stipend plus expenses.

Asked to address Zico’s criticism, a FIFA spokeswoman referred Bloomberg News to June 2 comments by Domenico Scala, chairman of FIFA’s audit and compliance committee, who is helping lead changes at the organization. He said the structure of the executive panel is “at the core of the current issues FIFA is facing.”

According to Michel d’Hooghe, a Belgian surgeon who has been an executive committee member since 1988, top officials have held no more than five votes in the last quarter of a century in an attempt to avoid rifts.

“The problem with voting is that you end up with the majority who are happy and the minority who are unhappy,” D’Hooghe said in a recent interview before the scandal broke. In a typical meeting, the executive “in charge of the case makes the presentation and at the end the president asks: Is there consent?”

Status Quo

FIFA’s middle managers who are based at its headquarters in Zurich have also been wary of upsetting the status quo during Blatter’s presidency, according to Gregor Reiter, chief executive officer of Deutsche Fussballspieler-Vermittler Vereinigung, the German association of agents who has worked with FIFA management since 2008 on regulations.

“FIFA has plenty of administrators who are young and intelligent but the one reply I also got when dealing with them: we need permission from Blatter, or it’s up to Blatter,” Reiter said by phone. “They are highly paid people who live in a great city and they don’t want to bite the hand that feeds them.”

The FIFA spokeswoman, who didn’t directly address Blatter’s management style, referred Bloomberg News to comments by the outgoing president on June 2 in which he said he was pushing for integrity checks for all executives.

Deep-Rooted Change

Blatter plans to remain as president until a replacement is elected by FIFA’s 209 member associations in six to nine months’ time. As part of a reform program, the ruling body should also reduce the number of members on the executive committee and implement term limits for both the president and executives, Blatter said.

“We need deep-rooted structural change,” Blatter said.

Blatter, a 79-year-old Swiss, shouldn’t lead change after overseeing the current system for 17 years, according to Lennart Johansson, who lost to him in the 1998 presidential election.

“Of course he should leave now,” Johansson told reporters in Berlin. “I want him to go home, relax and have some fun for once.”

The corruption allegations made by U.S. prosecutors are limited to a few of the 24 executives, and most of their counterparts in other regions did their work diligently, according to Junji Ogura, who served on the top FIFA panel for nine years through 2011.

“We never knew anything about” the corruption, Ogura said by phone from Japan, saying it was limited to the Americas. “I am very angry about what has happened.”

Ogura said he was never offered a bribe while at FIFA. “No, no, never,” he said.

Reiter said FIFA needs executives from outside soccer to change the organization’s culture. He cited the example of German league clubs, which have board members from business.

Michel Platini, the leader of European ruling body UEFA who is the bookmaker’s favorite to replace Blatter, isn’t the right candidate, according to Reiter. Although the Frenchman has publicly criticized Blatter, he remains an insider who’s been on the FIFA executive board since 2002.

“He has the bark but not the bite,” Reiter said.

Before it's here, it's on the Bloomberg Terminal. LEARN MORE