Corruption in Football – FIFA, the German Football Association and Summer Fairy Tales

By Markus Pohlmann

As British television host and comedian John Oliver has already pointed out in his satirical show: football is like sausages. If you love something, never find out how it’s made. In this respect, we are scoring an own goal. If you look at the current accusations against FIFA officials, you do not have to ask anymore who or what was for sale, but vice versa: who and what was not?

Source: Pixabay


Money scores goals

Certainly, we all know that success in football is also bought in a legal manner. Money scores goals. Uwe Wilkesmann recently highlighted the link between players‘ salary and league table position of the Bundesliga clubs in an article: the more the Bundesliga clubs can pay their players, the more points they realize. Admittedly, sometimes the situation looks different in the midrange of the Bundesliga table and creates suspense, but overall this connection can be clearly demonstrated in line with Wilkesmann’s calculations over the last 15 years. The revenues from the Champions League significantly increased this legal inequality in the starting conditions of the Bundesliga clubs over the last few years.

This is, however, by no means the end of our story on the purchasability of football as a sport. Let us turn to the illegal, corrupt actions, and thus to FIFA. So far, 42 FIFA officials have either been charged or convicted under anti-Mafia laws (The Racketeer Influenced and Corrupt Organizations Act, RICO) in the US as members of a criminal organization. Chuck Blazer, a former member of FIFA’s Executive Committee and former Vice President of the United States Soccer Federation, has been working as an informer for the FBI since 2011, and contributed as the principal witness to the exposing of the whole system. To date, the US judiciary has imposed fines of over US$ 190 million on the accused. More than US$ 100 million have been frozen. Some of them have pleaded guilty. This makes us wonder to what extent this enormous degree of corruption has been fostered by the organizational form of FIFA, and to what extent it has to do with organizational deviance. What is surprising about the legal actions that the U.S. Department of Justice and FIFA had taken against these corrupt officials in 2015, is not so much the corruption itself, but the extent and variety of illegal activities.

It has thus been convincingly demonstrated that one can buy votes both for awarding World Cups and for presidential elections. For instance, around US$ 100 million were paid in bribes for three votes from FIFA’s Executive Committee in the awarding of the 2010 World Cup to South Africa. From the 1998 World Cup in France to the 2022 World Cup in Qatar, according to the charges and guilty pleas, all electoral procedures turned out to have been influenced by the bribery of some FIFA officials. The prosecution also stated that a vote cast in the right ballot box in the 2011 FIFA presidential election could fetch around US$ 1.6 million. Likewise, millions of US dollars, according to the guilty pleas of some officials, were redirected into their own pockets in the awarding of media rights. The then President of the Caribbean Union (CFU) alone solicited US$ 3 million in bribes for the transfer of media rights to one of several companies. Sponsorship contracts were also awarded by means of bribery. And these are just the most common examples on a long list of corrupt behaviours of FIFA officials.

Organized Irresponsibility

A look into the environment of FIFA reveals that for decades regulations and controls by the Swiss authorities were extremely lax. Significantly, it is the investigation and prosecution authorities in the US that began the legal reappraisal of the corrupt structures, whereas Switzerland, the official seat of FIFA, slowly launched their investigations afterwards. Internally, experts speak of organized irresponsibility. Doors were wide open for corrupt behaviours. FIFA’s management (President and the Executive Committee) on the one hand had relatively little sway over the legally independent national football associations, and on the other hand is itself difficult to be held accountable. Apparently, its interest in the internal control of such a meta-organization was markedly low. As a supranational umbrella organization with 209 national, legally independent member organizations and six regional  associations, FIFA’s organizational form itself appears to be particularly susceptible to corruption. As a global monopolist, this umbrella organization has used an environment often extraordinarily hospitable to corruption to create its own community of football, and has thereby imported, as it were, corrupt structures. Since the sums of investment involved in the case of the awarding of World Cup are very high and largely borne by tax-payers, lucrative rent-seeking opportunities opened up that prompted vote-buying with millions in bribes. Since the bribed mostly came from countries where bribery is part of everyday life, the risk of being exposed, in particularly, must hence have appeared low, too. This aided and abetted a „normalization“ of corrupt structures.

Source: Pixabay

While the bribed themselves had caused damage by offsetting FIFA’s profits and FIFA consequently filed a tort claim in 2015, it looks rather different on the side of bribe-payers. As is typical for organizational deviance, they have acted primarily in the interest of their respective national football association without illegal personal enrichment, according to the previous investigation. According to reports of the German Federal Government, the German Football Association made a profit of €28,25 million. For the central organizers, career perks were connected to expense allowances (see also the master thesis of Jennifer Helbig). According to an investigation report by the law firm Freshfields Bruckhaus Deringer on behalf of the German Football Association, however, illegal personal enrichment of the organizers barely played a role or one that could not be proven with necessary certainty. These officials, normally long-standing and high-ranking insiders, testified that they adjusted themselves to the prevailing informal rules of the game at FIFA in order not to jeopardize their organizational goal. To date, it is not clear in this case who was actively involved in the alleged bribery process and had access to background information. However, four members of FIFA’s Executive Committee responsible for the awarding of the 2006 World Cup to Germany have also been accused of corruption.

Looking more closely at FIFA, one sees in any case an umbrella organization which operated in a thinly regulated environment with few internal controls or compliance efforts and tolerated corruption – whether intentionally or not – in its global network. Its organizational form and its environment gradually invited it to this end. Too few and too many regulations obviously have the same effect: they increase the risk of corruption. Though many football fans have expected nothing else from FIFA, now the accusations, guilty pleas and evidence are there and illustrate that it was even worse than expected. But should we draw similar conclusions as with the sausages and simply by and large give up on football? I don’t think so. Even if our appetite for football dies away with the thought that the next World Cups will be held in Russia and Qatar, FIFA is restructuring itself. Let us give it a chance, even against our better judgement.

 

Sources

Uwe Wilkesmann (2017): Social inequality in German football. Does money score goals?, Working Paper, February 2017

Jennifer Helbig (2016): Aktive Korruption im Rahmen des Vergabeverfahrens der FIFA-Fußballweltmeisterschaft 2006 – ein Fall von organisationaler Devianz? Eine soziologische Einzelfallstudie, unveröffentl. Masterarbeit, Soziologie, Universität Heidelberg

Freshfields, Bruckhaus, Deringer, Deutscher Fußballbund e.V. (2016): Interne Untersuchung – Untersuchungsbericht, 4. März 2016