Fifa scandal: US securities commission investigates company dealings – report
SEC reportedly examining whether effective bribes passed between Fifa-linked bodies and US commercial partners in breach of Foreign Corrupt Practices Act
US securities regulators are examining the behaviour of several companies with links to Fifa or other soccer bodies caught up in a major global corruption scandal to see if there were possible violations of US federal bribery laws, according to a report.
The civil probe was in its early stages and may or may not lead to any findings of wrongdoing or enforcement action, said the Reuters news agency, citing an unnamed official who described an investigation being carried out by the USSecurities and Exchange Commission.
Separately, the head of Bolivia’s soccer federation, Carlos Chavez, has been arrested on charges of corruption in the management of finances related to the sport, according to that country’s public prosecutor.
US and Swiss authorities are conducting a wide-ranging investigation into bribery involving soccer officials, marketing executives and various companies. In late May the US indicted nine soccer officials – most of whom held positions at Fifa – and five executives for a range of offences related to more than $150m of alleged bribes and kickbacks.
The SEC probe centred on publicly traded companies who have been involved in soccer contracts, such as athletic shoes and sportswear company Nike, said the Reuters source, who asked not to be named because of the non-public nature of the investigation.
The exact scope of the probe and the names of other companies being scrutinised could not be learned, Reuters said.
Although Nike has not been specifically named or charged with any wrongdoing, the company was swept into the scandal when US prosecutors in the indictment described bribes and kickbacks in connection with a landmark 1996 deal in Brazil.
The description of the $160m, 10-year deal signed by “Sportswear Company A” matched the details of Nike’s agreement to become the footwear and apparel supplier and sponsor of the Brazilian national team, which at that time was the most successful in the world.
In a statement on Friday a Nike spokesman said that the company “is committed to co-operating with any government investigation into the Fifa matter”.
In late May Nike said that the government had not alleged it violated the law or knowingly took part in a kickback scheme.
Securities experts say the SEC could potentially have a hook in the wider Fifa affair through the Foreign Corrupt Practices Act (FCPA), an anti-bribery law. The SEC and the US justice department both have power to bring FCPA cases, with the SEC’s jurisdiction centred on violations by public companies.
The law’s core anti-bribery provisions only apply to payments to governments or government officials. The Brazilian Football Confederation (CBF), which signed the 1996 deal with Nike, is a private organisation.
But the law contains a corporate books and record-keeping requirement that applies to other kinds of illicit payments – such as commercial bribery – that may not be related to government corruption.
A provision of the FCPA prohibits companies from falsely recording bribe payments as legitimate business expenses.
Meanwhile, in the case being pursued by Bolivian prosecutors, Chavez, who is also the treasurer of the South American Football Confederation, Conmebol, has been arrested on suspicion of a scam in the case of a fund set up for the family of a fan who died at an international match in the city of Oruro in 2013, the Bolivian state news agency ABI reported.
According to ABI, the fan’s family never received any money from that fund.
US and Bolivian authorities were unavailable for immediate comment on whether the arrest had anything to do with the US corruption investigation into world soccer’s governing body Fifa and related organisations, such as Conmebol.
The public prosecutor’s office said it also arrested the secretary general of the Bolivian federation, Alberto Lozada.
“The charges being investigated are criminal organisation, legitimisation of illicit profit, the untoward use of influence … and fraud,” said Bolivia’s attorney general, Ramiro Guerrero.
Guerrero said more than 40 people had testified so far in the course of the investigation, which began on 1 June.
Chavez’s lawyer, Jaime Tapia, called his arrest “shameful”, saying authorities should have listened to him before detaining him.
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