Understanding the FIFA Scandal: A Quick Breakdown

Sepp Blatter. Image via AP.

The Federation Internationale de Football Association, better known as FIFA, is the international governing body of football (or, in America, the sport of “soccer”). Founded on May 1904 in France, it has 209 national associates and runs the world’s most prestigious football game: the World Cup. In 2013, FIFA had the revenue of $1.3 billion in U.S. dollars for a net profit of $73 million, and has cash reserves of $1.4 billion U.S. dollars.

May 27th: The Scandal Breaks

Lately, FIFA has come under a lot of heat, as a massive scandal broke when, on May 27th, 2015, Swiss officials arrested several high ranking FIFA executives at their headquarters in Zurich, Switzerland. The authorities alleged charges of corruption and bribery in it’s highest ranks for the last two decades involving everything from World Cup bids, marketing, and broadcasting deals. Two Vice Presidents, Jeffery Webb (Cayman Islands) and Eugenio Figueredo (Uruguay), were indicted, along with a slew of others, including Eduardo Li (Costa Rica), Julio Rocha (Nicaragua), Costas Takkas (United Kingdom – GB), Rafael Esquivel (Venezuela), and Jose Maria Martin (Brazil). 14 were arrested and indicted with racketeering, wire fraud, and money laundering. Read more about the defendants here.

Soon after, Swiss prosecutors opened an investigation into the bids for the 2018 and 2022 World Cups, set to take place in Russia and Qatar, respectively. Many have called for an investigation into the bids as well as a re-vote on the proposed locations, but, so far, FIFA has remained firm and refused to change the venue, stating that no malicious activity went into the choice of venues.

The U.S. Department of Justice gets involved

Loretta Lynch. Image via Guim.

Scant hours later, the U.S. Department of Justice announced that they have enough evidence to open an investigation into FIFA as well, alleging corruption charges that go back 24 years. They said they have uncovered 12 different schemes, some of which pertained to the 2010 World Cup bid of South Africa. U.S. Attorney General Loretta Lynch has announced her intention to prosecute the guilty parties. A 47-count indictment was unsealed in a New York federal court, and guilty pleas of four individual defendants and two corporate defendants were unsealed as well.

May 28th: FIFA’s Presidential Election

Unsurprisingly, FIFA was thrown into chaos. The accusations fell on the day before FIFA’s next presidential election, where current acting president Sepp Blatter was running against Prince Ali bin al Hussein of Jordan for the presidency. Despite calls for Blattner to either change the election date or step down, Blattner announced that the election would go ahead as scheduled, saying “I can’t monitor everyone all of the time. If people want to do wrong, they will also try to hide it.”

The Union of European Football Associations (UEFA) called for the elections to be postponed, citing a need to “reboot” FIFA and “carry out real reform.” However, Blatter also rejected UEFA’s calls, saying that although he welcomed the investigations, he did not believe any events nor personnel changes should be made. Many suspect Blatter has played a heavy hand in the corruptions, but has been able to hide his tracks well. Football Association chairman Greg Dyke released a statement, saying “Blatter has put out a statement saying now is the time to start rebuilding the trust in FIFA. There is no way of rebuilding trust in FIFA while Sepp Blatter is there.”

The next day, is announced Blatter has been elected for a fifth four year term as FIFA president. He outpolls his rival 133-73 after the first round of voting, and Prince Ali withdraws from the second round of voting which he would have lost by a large margin.

Putin puts his two cents In

Russia then released a scathing litany aimed at the U.S. Department of Justice investigation, alleging the FBI was acting illegally in Zurich to uncover the corruption. As the hosts of the 2018 World Cup, the Russians are anxious to keep the game venue, and the U.S. investigation could damage that. Current Russian president Vladimir Putin announced “we are calling on Washington to stop attemps to make justice far beyond its borders using its legal norms.”

Image via Advertise Hype.

Corporate response

FIFA’s World Cups are some of the world’s biggest events, and FIFA has many sponsors. After the scandal broke, many sponsors, from McDonald’s to Adidas, reacted with statements, however, VISA was the first to publicly announce they would pull out of their sponsorship deal with FIFA should the organization decline to change, stating “Our disappointment and concern with FIFA in light of today’s developments is profound… [We] became a sponsor of FIFA because the World Cup is one of the few truly global sporting events with the power to unite people… it is important that FIFA makes changes now, so that the focus remains [on supporting the teams, enabling a great fan experience, inspiring the community…etc.].”

South Africa’s bribery charges

South African officials denied that a $10 million dollar bribe was paid to FIFA officials in order for the country to host the World Cup. Sports Minister Fikile Mbalula told reporters “We as a government and people managing the resources of the South African people– we did not share part of your resources with criminals, I am saying it now and forever.” However, evidence has come to light stating that former FIFA VP Jack Warner has pocketed the $10 million in bribes, laundering the money through a supermarket chain, made cash withdrawals, paid off credit cards, and took personal loans from the sum. Officials suspect the bribe was to secure votes for the 2010 World Cup.

May 29-3oth: Boycotts and more Bribes

Sports apparel company Nike announced that they were not apart of the bribery, hoping to separate itself from others listed in the U.S. FIFA indictment.

Richard Weber, the IRS chief in charge of criminal investigations, also announced that another round of indictments would likely be coming soon, saying “I’m fairly confident [of it].” Sepp Blatter responded by slamming the U.S.’s investigation, calling it an attempt to interfere with the Congress where he was elected, and criticized UEFA’s “hate” campaign. Football Association vice-chairman David Gill, recently elected to FIFA’s executive committee, announced that he would be rejecting his place on the committee due to the past week’s “terribly damaging events” while Blatter is still serving.

June 2nd: Blatter resigns

Image via VISA SE.

Sepp Blatter has announced his resignation in a hastily arranged news conference in Zurich, saying a special election would be held to appoint his successor. “FIFA needs profound restructuring. Although members have given me the new mandate, this mandate does not seem to be supported by everyone. We will hold an extraordinary conference as soon as possible. A new president will be elected.”

Update: This story is still developing. If you are interested in learning about the more recent events of the FIFA scandal, please visit this page to see all recent updates.

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