Salt Lake Olympic, global finance scandals hint charging FIFA execs could prove much easier than punishing them

On June 8, 1998, two days before Brazil opened France’s World Cup with a 2-1 win over Scotland, a former head of the World Society of Friends of Suspenders from rural Switzerland was elected as FIFA president. Sepp Blatter’s rise to power has proved to be a pivotal moment in modern sports history, but it was far from the biggest sports governance story of the year. That came in that winter, when the International Olympic Committee (IOC) was mired in a scandal related to its award of the 2002 Winter Olympics to Salt Lake City.

It was the biggest international sports controversy in recent years … until last week. So can the 1998 IOC scandal tell us anything about FIFA in 2015? Absolutely, given the parallels. But you might not like what you read.

Whenever a crime is uncovered, there always seems to be a smoking gun. In Salt Lake City’s, case it was a smoking scholarship fund. A local TV station aired a report about tuition money being paid to an American University student whose father was a member of the International Olympic Committee. National and international media followed up ton he story and quickly discovered a mountain of misdeeds both prosaic (free medical care) and weird (custom doorknobs); helped, it should be noted, by an outspoken senior IOC member with a conscience.

It turned out that the city’s organizing committee had paid more than $1 million total to 24 of the 114 IOC members, all brought to you by an institutional culture of secrecy and entitlement and a city that really, really, wanted to host a major competition. The mix bred a climate favorable to all sorts of creative gifts, inducements and favors. Bribes, if you want to be blunt about it.

400804 97: (NEWSWEEK, U.S. NEWS, MACLEANS & GERMANY OUT) U.S. President George W. Bush (C) stands with Jacques Rogge, president of the International Olympic Committee (IOC), and Mitt Romney, president of Salt Lake Olympic Committee (SLOC) during the American National Anthem at the Opening Ceremony of the Salt Lake City Winter Olympic Games at the Rice-Eccles Olympic Stadium February 8, 2002 in Salt Lake City, UT. (Photo by Donald Miralle/Getty Images)Getty Images

400804 97: (NEWSWEEK, U.S. NEWS, MACLEANS & GERMANY OUT) U.S. President George W. Bush (C) stands with Jacques Rogge, president of the International Olympic Committee (IOC), and Mitt Romney, president of Salt Lake Olympic Committee (SLOC) during the American National Anthem at the Opening Ceremony of the Salt Lake City Winter Olympic Games at the Rice-Eccles Olympic Stadium February 8, 2002 in Salt Lake City, UT. (Photo by Donald Miralle/Getty Images)

The IOC’s initial attitude can be summarized as: Well, we’re a big international group, we can’t keep an eye on everyone. Whatcha gonna do? Ultimately, though, 10 IOC members were expelled and 10 others sanctioned. A former Mormon missionary, one Willard Mitt Romney, was brought in to run the Olympic Committee. The Utah city kept the Games, despite everything.

The scandal was all very disappointing to one Joseph S. Blatter, but he reassured reporters that FIFA’s executive structure was an effective shield against such unfortunate events: “21 members is really a group of people that are easier to supervise than a group of 114.”

In a role reversal with the new FIFA scandal, the IOC scandal was a case of the Justice Department following up media revelations. And after a five-year investigation, there must have been a ton of arrests and convictions, right? Lots to show for all those taxpayer dollars, all that newspaper coverage all that time?

Turns out, according to the judge who acquitted Salt Lake City’s bid leaders and ripped prosecutors, there wasn’t much of a case to answer.

The only people who ended up with convictions were two relatively unimportant American businessmen who’d helped out the local organizers. And it wasn’t facilitating gifts or payments that got them, but trying to hide those wheel-greasing moments from the IRS. The pair pleaded guilty to tax fraud and then escaped punishment after agreeing to cooperate in a failed effort to ensnare bigger fish.

That’s not an encouraging precedent. On the plus side (if we can call extraordinary levels of corruption a plus), the alleged sums in the FIFA investigation are far, far larger, to the point of being unprecedented, and some former officials have already plead guilty.

NEW YORK, NY - MAY 27:  James Comey, Director of the Federal Bureau of Investigation (FBI), speaks at a packed news conference at the U.S. Attorneys Office of the Eastern District of New York following the early morning arrest of world soccer figures, including officials of FIFA, for racketeering, bribery, money laundering and fraud on May 27, 2015 in New York City. The morning arrests took place at a hotel where FIFA members were attending a meeting for the world governing body of soccer (football) in Switzerland. The Justice Department unsealed a 47 count indictment early Wednesday charging 14 world soccer figures.  (Photo by Spencer Platt/Getty Images)Getty Images

NEW YORK, NY - MAY 27: James Comey, Director of the Federal Bureau of Investigation (FBI), speaks at a packed news conference at the U.S. Attorneys Office of the Eastern District of New York following the early morning arrest of world soccer figures, including officials of FIFA, for racketeering, bribery, money laundering and fraud on May 27, 2015 in New York City. The morning arrests took place at a hotel where FIFA members were attending a meeting for the world governing body of soccer (football) in Switzerland. The Justice Department unsealed a 47 count indictment early Wednesday charging 14 world soccer figures. (Photo by Spencer Platt/Getty Images)

The World Cup is much bigger than the Winter Olympics, so there’ll be far more scrutiny on FIFA and the future of the next two tournaments than there was on the IOC. And there will be far more incentive for the U.S. to commit considerable law enforcement resources to get results, both for the publicity, the chance to bring in the money they’ve been following, and the possibility of getting the 2022 tournament moved away from Qatar, possibly to its own shores.

And advocates can take heart that the episode sparked positive change in the IOC, which, during the 2000s, enacted reforms to restore credibility, placate jittery sponsors and reduce the potential for corruption, such as restricting travel for members and contact between them and bid cities. It limited the president’s rule to a maximum of 12 years when Juan Antonio Samaranch had been in charge for 21 years – the same tenure as Blatter, if he sees out his fifth term.

Ah yes, Samaranch. The fascism fan built the IOC from a small-scale operation into a powerful and wealthy body by leveraging the appeal of the quadrennial tournaments, ushering in professionalism and commercialism and masterminding vast increases in sponsorship and broadcast revenue … all while living in a five-star hotel in Switzerland.

Here’s an extract from a Daily Mail article from 2010, just after the Spaniard’s death at the age of 89:

“[he] turned the IOC into a personal fiefdom which became synonymous with arrogance and corruption. And for all his imperious talk about the role of the ‘Olympic Family’ in ‘the harmonious development of man’, it was, ultimately, Samaranch who allowed the movement to become mired in scandal.”

Sounds like someone we know. Did Samaranch resign after the Salt Lake scandal? Did he accept responsibility for playing a key part in an organization mired by corruption? Was any of it tied directly to him?

No, nope and negative. He enjoyed the power of his role, felt impelled to carry on by a sense of personal destiny and argued he was the best man to oversee a new era and hold a troubled governing body together. When he finally stepped down in 2001, he remained active in Olympic circles and was named honorary life president of the IOC.

If Samaranch survived, why can’t Blatter? That’s the question-slash-nightmare scenario. If this mirrors Salt Lake City, a few senior execs will be mired in legal trouble for years, heads will roll at FIFA as the organization tightens its World Cup bidding rules, starting with 2026, yet the man at the very top – who is either corrupt, incompetent or both – will carry on, diminished but defiant.

That would be better than nothing, better than we expected after FIFA’s head-in-the-sand treatment of the Garcia report, but still a disappointment. A hollow victory and no kind of tribute to the memories of the scores of migrant workers who have died in Qatar.

DOHA, QATAR - OCTOBER 23:  Workers stand on the construction site of a new office building in the budding new financial district on October 23, 2011 in Doha, Qatar. Qatar will host the 2022 FIFA World Cup football competition and is slated to tackle a variety of infrastructure projects, including the construction of new stadiums.  (Photo by Sean Gallup/Getty Images)Getty Images

DOHA, QATAR - OCTOBER 23: Workers stand on the construction site of a new office building in the budding new financial district on October 23, 2011 in Doha, Qatar. Qatar will host the 2022 FIFA World Cup football competition and is slated to tackle a variety of infrastructure projects, including the construction of new stadiums. (Photo by Sean Gallup/Getty Images)

For fans, this is primarily emotional: a betrayal of the game we love, an abuse of our trust, actions that may have unjustly determined the location of the next two World Cups. Crimes against the values that sport should stand for. The actions that are likely to yield the best results for law enforcement, though, are pretty dry and perfunctory – wiring money in dollars via U.S. banks, which opens the door for the U.S. to investigate just about anything, anywhere.

Yet the Justice Department’s most internationally-high-profile investigation prior to FIFA was all about finances but didn’t yield any high-profile perps. The global economic crisis that began in 2008 had its genesis in the irresponsible, greedy and sometimes illegal actions of under-regulated American and European bankers. Hundreds of millions of ordinary people suffered. Billions of dollars in fines have been levied. And how many senior bankers went to prison? None.

Political and financial systems are too closely intertwined, too interdependent; banks too essential, too powerful, too complex. Clearly, U.S. law enforcement doesn’t have those kind of issues or potential conflicts with soccer, so there is some reason to think that we’ll see more individual accountability in this case, especially if law enforcement officials have learnt lessons from the unsuccessful investigation into Salt Lake City.

What’s more, there are reports that the banks that allegedly shuffled FIFA’s dirty money around the world are in the line of fire. The more guilty FIFA and its execs appear, the more likely that officials will be able to hold banks accountable for their roles and hammer them with yet more fines.

When the dust has settled on this saga, it’s possible that not only will Blatter and his cronies have been taken down, but the world will have extracted a little more revenge on the financial institutions that helped make FIFA executives richer and the rest of us poorer.

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