Europe follows America’s lead on FIFA, VW scandals

First world soccer, now the world’s top automaker. The US has taken the lead in prosecuting trans-Atlantic white collar crime. Has Europe dropped the ball? Spencer Kimball reports from Chicago.

FIFA’s leadership has been decimated since the US Justice Department charged world soccer with racketeering and money laundering last May.

Sepp Blatter, FIFA’s long-time president, and two of his deputies have been banned from the organization for 90 days. Powerful sponsors such Coca Cola, McDonald’s and Visa are calling on Blatter to step down immediately.

Volkswagen is next in the firing line. Last month, the Environmental Protection Agency revealed that the automaker had been cheating on US emissions tests. Volkswagen’s stock value has plummeted and its chief executive, Martin Winterkorn, has resigned. The Justice Department is now investigating and criminal charges could be brought against Germany’s largest company.

Both FIFA and Volkswagen are based in Europe. Yet US regulators and investigators have been at the forefront in pursuing these white collar criminal cases. According to William Black, a former bank regulator, the US simply has more tools at its disposal than Switzerland, Germany or the EU.

“The United States, despite this record of catastrophic failure in responding to the white collar epidemics that drove the financial crisis, still has vastly better laws for regulating and prosecuting, and still has vastly greater willingness to take on powerful folks than is true in many places,” Black told DW.

Continue reading

Court of public opinion clashes with US over FIFA head Sepp Blatter

(By Deutsche Welle) A US investigation into alleged corruption at FIFA devastated the world’s most powerful sports organization in a week. Sepp Blatter’s backers have cried foul. But experts question why Europe didn’t act much earlier.

Sepp Blatter defied the world’s only superpower – for three business days.

While his handcuffed associates were hauled away from their five-star hotel in Zurich to face extradition, Blatter was re-elected to another term as FIFA’s head last Friday. He subsequently lashed out at the United States, implying that the Justice Department’s investigation into alleged corruption within global soccer was misguided and a case of poor sportsmanship.

“There are signs that cannot be ignored,” Blatter said. “The Americans were the candidates for the World Cup of 2022 and they lost. The English were the candidates for 2018 and they lost, so it was really the English media and the American movement.”

The Swiss soccer baron had powerful backers. According to the “Guardian” newspaper, Russian President Vladimir Putin accused the US of “illegally persecuting people,” questioning why the Justice Department would seek to arrest foreigners conducting business in Switzerland.

Russia will host the World Cup in 2018. Swiss authorities are now investigating whether or not corruption played a role in awarding the global tournament to Russia as well as Qatar in 2022. On Wednesday, former FIFA executive committee member Charles Blazer admitted in a US federal court to accepting bribes for the 1998 and 2010 World Cups.

“It’s another clear attempt by the USA to spread its jurisdiction to other states,” Putin said. “And I have no doubt – it’s a clear attempt not to allow Mr. Blatter to be re-elected as president of FIFA, which is a great violation of the operating principles of international organizations.”

But it didn’t really matter who supported Blatter in the end. Though re-elected to a fifth term in a landslide vote, the FIFA head announced his resignation on Tuesday, amid reports that he too is under investigation by the Federal Bureau of Investigation. Blatter will remain in his post until an extraordinary FIFA congress elects his successor.

“There’s no question that many people will be implicated in things that will not pass muster in court,” said Stefan Szymanski, author of “Money and Soccer” and a sports governance expert at the University of Michigan.

“However, to refuse to cooperate with the US Justice Department is a pretty risky thing,” Szymanski told DW. “Particularly if you want to go to the United States or a country that has an extradition treaty with the United States.”

Continue reading

Washington fuelling graft in Afghanistan

(By Deutsche Welle) Washington has long maligned Kabul for being weak on corruption. But the Central Intelligence Agency has reportedly been buying access to President Hamid Karzai’s inner circle for a decade.

The United States and its NATO allies have complained for years about rampant corruption in Afghanistan, voicing frustration with President Karzai’s inability – or perhaps unwillingness – to fight graft and improve the rule of law.

But according to a report published by the New York Times on Monday, Washington may be one of the biggest contributors to that very corruption. The Central Intelligence Agency has reportedly been dropping off suitcases stuffed full of American dollars at the office of the Afghan president for years, in an effort to buy influence in Kabul.

The British Guardian reported on Tuesday that the United Kingdom’s MI6 also may have made cash payments to Karzai’s office, in an effort to promote meetings between the Taliban and the Karzai government.

The alleged CIA bribes have supposedly amounted to tens of millions of dollars over the past decade. Much of the money was reportedly distributed to warlords and politicians, in an effort to buy their loyalty.

Continue reading