Blatter's (former?) buddy.

Photographer: Dennis Grombkowski/Getty Images

FIFA's Corruption Cleanup Reaches a Corner Office

Kavitha A. Davidson is a former Bloomberg View columnist.
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The investigation into rampant corruption at FIFA has drawn one step closer to the top, taking down Sepp Blatter's right-hand man.

FIFA suspended Secretary General Jerome Valcke after allegations that he was involved in a scheme to sell tickets to the 2014 World Cup at far higher than face value. Messages between Valcke and a consultant at JB Sports Marketing, a Swiss company that had partnered with FIFA to sell World Cup and Confederations Cup tickets, suggest Valcke directly profited from the sale of tickets at up to five times their normal price. The documents are incomplete, so there's some room for interpretation.

The Office of the Attorney General of Switzerland is investigating these claims as part of its broader probe into corruption at FIFA with U.S. Attorney General Loretta Lynch. Valcke is already being investigated for signing off on a $10 million payment from South Africa's World Cup organizing committee to disgraced former FIFA vice president Jack Warner that's being considered a bribe. 

FIFA has vowed to clean up its act, but those promises sound rather empty. The association's ethics committee hasn't shown itself to be willing or able to properly rid FIFA of its culture of corruption. Valcke's sudden dismissal is meant to convey that FIFA is serious about reform. Instead it conveys how far up the organizational hierarchy the problems reach. On Monday, Lynch said at a press conference that she expects many more indictments as the scope of the investigation widens, in addition to the 14 that came down in May. The question now turns to whether Blatter would be the next target, and when.

Both Blatter and Valcke have announced their intentions to resign in February, but neither had actually stepped down. This raised the worrying prospect that nothing would really change until FIFA rid itself completely of the men at the top who oversaw decades of dirty dealings -- a view bolstered when Valcke remained in office despite revelations that he had authorized the Warner bribe. A fierce ally of Blatter's, Valcke has a history of questionable conduct carrying few consequences. In 2006, he was forced to resign as FIFA's marketing director after a judge ruled he lied to both Visa and MasterCard during negotiations for World Cup sponsorship deals. Ten months later, Blatter appointed him secretary general.

Valcke's dismissal this week is part of FIFA's strategy to prove it's taking reform seriously by severing ties to executives under Blatter, still preserving the head of the beast. Among the casualties are former communications director Walter De Gregorio, who resigned his post in June after making a joke on a Swiss talk show that apparently didn't sit well with Blatter. (The joke: "The FIFA president, secretary general and communications director are all traveling in a car. Who's driving?" Answer: "The police.") 

Valcke is by far the highest-profile official to be cut loose as investigators zero in on the man known as Blatter's "fixer." Investigators thus far have successfully turned lower-level officials accused of corruption into cooperating witnesses to gain testimony on the association's corruption. One can only imagine the kind of information they might hope to get from Valcke should he choose or be forced to cooperate.

True to form, and defiant to the end, Valcke reportedly sought a multi-million-dollar buyout of his contract just a week before his suspension. That Blatter didn't immediately oblige, I suppose, is a sign that some things have changed at FIFA.

This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.

To contact the author of this story:
Kavitha A. Davidson at kdavidson19@bloomberg.net

To contact the editor responsible for this story:
Philip Gray at philipgray@bloomberg.net