The Bock’s Score: Discontent and a Criminal Enterprise
The Winter of Our Discontent (1961) was John Steinbeck’s last novel. Steinbeck said that the wrote Discontent to address the moral degeneration of American culture during the 1950s and 60s. I am no John Steinbeck, and have never written a novel. However, I think chances are good that 2015 may in the future be looked upon as international sport’s Year of Discontent – a year in which the public began to become aware of deepening degeneration in governance in international sport.
FIFA President Sepp Blatter Suspended
In early October the FIFA Ethics Committee issued ninety (90) day suspensions to two of the most powerful men in international soccer, FIFA’s Swiss President Sepp Blatter and European soccer’s French President Michael Platini. Make no mistake, the elimination of Blatter and Platini from their powerful positions is permanent and a watershed moment that signals that the corruption that thoroughly permeated world soccer has finally eroded the once impregnable status of these former potentates of the beautiful game.
Yet, for all its portent, last week’s action by FIFA should be met with a single question: “What took you so long?”
The basis for the FIFA Ethics Committee’s action was an undocumented transfer of approximately two million in Swiss Francs (about $2 million U.S.) to Platini that came about a month before Blatter was re-elected to the FIFA presidency in 2011 and several months after Platini had delivered the support of European soccer to Blatter’s re-election bid. The farcical explanation given for the transfer was that Platini had allegedly “earned” the payment when he worked at FIFA in 1998-2002 but had never been paid what he was owed. Of course, no documents memorialized the alleged debt to Platini.
In a rational, transparent and ethical world the action of the FIFA Ethics Committee would be surprising only for the length of time it took the Committee to begin its house cleaning. However, “rational,” “transparent” and “ethical” are not adjectives frequently used of late to describe the opaque inter-workings of international sport federations, certainly not international soccer.
International soccer as a “corrupted enterprise”
The international soccer scandal exploded on the world scene in May of this year when seven FIFA leaders were arrested while attending a FIFA Congress in Zurich. Those arrests flowed from a U.S. law enforcement investigation of collusion in awarding media rights contracts. In all, a dozen-and-a-half soccer officials have been charged to date in the U.S. The indictments issued in the States charged violation of federal racketeering laws, and state “the defendants and their co-conspirators corrupted the enterprise [i.e., international soccer] by engaging in various criminal activities, including fraud, bribery, and money laundering.” In essence the U.S. Department of Justice (U.S. DOJ) contends that the sport of international soccer has been run as a criminal enterprise.
Think about that last statement for just a second. It is an absolutely extraordinary allegation that the most popular sport in the world is being run as a “corrupted,” criminal enterprise.
In colloquial terms, recent developments have cast Sepp Blatter and Caribbean soccer kingpin Jack Warner as the Al Capone and Carlo Gambino of soccer. If the U.S. DOJ allegations stick, and it appears they will, Blatter and his confederates (including the 18 defendants indicted by the U.S. DOJ to date) may be viewed by posterity as the 21st century moral equivalents of John Dillinger, Baby-Faced Nelson and Machine Gun Kelly.
Simultaneous to the Zurich arrests, the Miami offices of the organizing body for soccer in Caribbean, Central and North America were raided. The U.S. law enforcement operation energized separate law enforcement investigations being conducted by a number of other jurisdictions, likely including Australia, Costa Rica and Switzerland. More indictments are almost certain to follow.
In May, Blatter, international soccer’s longtime strongman, known for his tight control over FIFA operations, disingenuously protested, “I cannot monitor everyone all the time.” He also criticized the U.S. DOJ’s actions as timed to try to prevent him from being re-elected. Yet, financial scandal has evidently been festering within FIFA for some time, perhaps as long as a decade or more. The U.S. law enforcement investigation began in 2009 or 2010 and whistleblowers, and television documentaries and exposés have alleged fraud, mismanagement and financial self-dealing since at least 2001.
Despite the evidence of massive corruption within FIFA and the existence of several other noteworthy recent scandals in international sport, the willingness to interpret this scandal as evidence of a transcendent problem in sport governance has been surprisingly muted.
The ability of sport strongmen to survive scandal
Until last week Sepp Blatter, described by Forbes Magazine just last year as the most powerful man in sport, had maintained a firm hold on power within FIFA. To the everlasting discredit of the organization, Blatter was re-elected to the FIFA presidency on May 29, 2015, just two days after the Zurich arrests, when widespread corruption within FIFA was clearly evident to all the voting delegates at the FIFA Congress.
Of course, Blatter is far from the only international sport powerbroker who has managed to maintain the mantle of power within his sport despite allegations of pervasive corruption that have made him a pariah outside the sport. In addition to soccer, both international cycling and track and field have recently witnessed significant scandals and experienced difficulty in purging the sport from the source of its troubles.
Track & field allegations
Last December allegations of corruption – including bribery and payoffs – in the administration of the anti-doping program of international track and field (governed by the International Association of Athletics Federations – the IAAF) which were reported in a detailed television documentary on German television led to an official announcement that the allegations were being investigated by the IAAF Ethics Commission. Shortly thereafter, the British paper, The Guardian, reported that the IAAF’s long-time anti-doping administrator, Gabriel Dollé, was stepping down after being interviewed by the IAAF Ethics Commission. No other IAAF executive has been reported as leaving in response to the allegations.
Subsequently, the World Anti-Doping Agency (WADA) appointed an independent commission to investigate the IAAF allegations. This summer the same German broadcaster that broke the original story produced a new documentary with more allegations, and WADA announced that its independent commission was expanding its investigation.
In August Sebastian Coe was elected on a reform platform to head the IAAF. It is anticipated that plans for addressing the ethical concerns plaguing the sport will soon be announced. Yet, neither the IAAF Ethics Commission nor the WADA Commission have announced their findings, and it may get worse before the future brightens for the sport. It is apparent that international track and field will not be on a solid footing until a complete disclosure of the scope of the apparent scandal is revealed.
The woes of FIFA and the IAAF were preceded by upheaval in the sport of professional cycling, resulting from the willingness of its international federation, the Union Cycliste Internationale (UCI), to provide aid and comfort to athletes which international officials knew were likely engaged in violating sport doping rules. The house of cards began to cave in on international cycling during the U.S. Anti-Doping Agency (USADA) investigation of the U.S. Postal Service Cycling team – Lance Armstrong doping program. During USADA’s case against Armstrong the UCI changed its legal position on USADA’s jurisdiction over Armstrong and sought to wrest the case from USADA in order to try to end the USADA prosecution.
This March the extent to which the UCI had become co-opted by Armstrong was revealed in the report of the Cycling Independent Reform Commission (CIRC) which cited internal UCI documents establishing that during the Armstrong era, in 2006, the UCI had permitted Armstrong’s lawyer to write parts of a report of a supposedly independent commission which had been investigating evidence of Armstrong’s doping. The CIRC also documented conflicts of interest in permitting Armstrong to return from retirement without being subject to drug testing for the required period of time, and the UCI leadership’s internal discussions in 2012 when they were trying to derail USADA’s case against Armstrong.
Governance issues unresolved
The all too prevalent recent scandals in international sport are disheartening for sports fans, detrimental to sponsorships and destructive to the long term well-being of these sports. They point as well to serious governance issues that remain to be solved.
The FIFA and UCI cases in particular demonstrate the difficulty of rooting out corruption even when it has become evident within a sport. The problem results, in part, from the archaic manner in which many international sport leaders are selected. Frequently, international sport leaders are elected from a large, diverse, international pool of delegates that have only limited access to information about how the sport is being run. As a consequence, the advantages of incumbency are immense and sport leaders who control the purse strings and patronage within their organizations are exceedingly difficult to dislodge.
In cycling, UCI President Pat McQuaid, stood for election even though his candidacy was repudiated by his home delegation from Ireland because he was able to get the rules changed to permit himself to be nominated by delegates from other countries. Ultimately, McQuaid lost re-election for the UCI Presidency in 2013 by only six votes. Within FIFA Sepp Blatter was able to maintain the loyalty of a block of voting delegates and weather scandal after scandal long after it was clear that he had become a massive hindrance to the well-being of the sport.
It is also evident that in some international sports the interests of the athletes who play the games and the desires of the fans who watch them are not sufficiently prioritized. While international sport organizations purport to be run for the good of sport, the truth is that diffuse accountability can make it too easy for self-interest to control decision-making. Unlike public corporations accountable to shareholders and not-for-profit organizations generally subject to state regulation and disclosure requirements and effective board oversight, the line of accountability from sports federations to their stakeholders is more attenuated. Consequently, it is exceedingly difficult for grassroots reform to take place in sport.
Law enforcement actions result from a void of accountability
Blatter quickly criticized the involvement of law enforcement in the FIFA arrests in May as politically motivated and Russian President Vladimir Putin came to Blatter’s defense, leveling a similar allegation. The truth is, however, that by failing to act sufficiently aggressively to address the problems in FIFA international sports oversight bodies left a void that had become so wide that law enforcement authorities had to act to prevent the continued operation of international soccer as a criminal enterprise.
As long as sport governing bodies fail to act aggressively to root out corruption in sport, governments are going to have to come to the rescue of the athletes, fans and other sport stakeholders who are being victimized by corrupt sport leaders. Matters obviously progressed so far down the wrong road in the sport of soccer that continued extensive government involvement to clean up the sport is inevitable. The most evident current flashpoint for possible future government involvement in sport are the emerging problems in track and field. Without prompt and fulsome action by WADA and the IAAF Ethics Commission government intervention in track and field may become inevitable as well.
Lack of transparency is a huge reason that international sport has faced scandal after scandal. For lasting change to take hold transparency reforms must be enacted. This means that audited financial statements must be available on the websites of all sports organizations. The salaries of top officials and all significant expenditures must be publicly disclosed. Term limits for board members must be adopted. Payments for international travel and other perquisites should be regularly audited.
Conflict of interest rules must become a cornerstone of sport governance and there must be adequate enforcement mechanisms in place to ensure that these rules are followed. Furthermore, in key areas where conflicts can arise such as anti-doping, enforcement and investigatory functions must be externalized. Sports must be willing to give up power to ensure transparency and the independent enforcement of ethical standards, including anti-doping rules. The “fox guarding the hen house” mentality must be extinguished.
The current scandals in international sport should be more than sufficient motivation for such reforms, however, if sport governance reforms are not soon enacted there is one thing we can be sure of, there will be more scandals. International sport is broken and it will not get better until it is fixed.
The Bock’s Score – Bill Bock is the General Counsel for the U.S. Anti-Doping Agency, click The Bock’s Score to read prior articles by Bill.
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