“Connectivity will be an enabler. Transparency for better government, education, and health.” Bill Gates
Eighteen months and 430 pages have gone into Michael Garcia’s report for the FIFA ethics committee into the 2018 and 2022 World Cup bidding, and there have been acres more pages of newsprint produced on the back of it. It was the highest-profile measure to emerge from the Independent Governance Committee’s strategic review of FIFA’s operations. But it was by no means the most important.
Of course Garcia’s report is entirely necessary. If people have been guilty of corruption or fraud, they should be brought to justice. But, unless one or other of the successful bidders is stripped of their hosting rights, which I highly doubt, then in the grand scheme of things little will come of it.
Even as Hans-Joachim Eckhert deliberates over what to do with the findings contained in Garcia’s report, what interests me far more than what occurred in a one-off vote back in 2010 is what FIFA is doing on a daily basis today. For the opportunities for corruption throughout the world game have always been rife. It is only because it does not involve a global media event like the World Cup bidding decision that seldom has anyone ever paid attention.
In June 2011 a former senior administrator of one African national association gave me a wholesale run-through of how things worked on the ground in his country. “The way we run these federations is with cash,” he said. “There are no cheques, no bank transfers. They only use cash. Even when they pay the players it is in cash. They do this willingly because they know that it’s too transparent to use other methods. Every penny in my nation’s football is always in cash. It’s easy that way to rob it.”
These were not the words of some loner with an axe to grind. I tracked down a European former manager of the same nation, one that was successful enough to have played in the World Cup. He confirmed that he had experienced problems with his home nation’s inland-revenue service due to the difficulties it had encountered in tracing the salary and bonus payments he had received.
There was no excuse for these practices. The efforts of people like Bill Gates mean we live in a connected world. The refusal to implement measures of transparency was clearly willful. This should have been treated as a very serious issue but it was not until Mark Pieth’s IGC raised the matter in its report, the FIFA Governance Reform Project, was any attention ever given to it. “When it comes to govern FIFA as an economic enterprise, the inter-dependence between FIFA and its member associations in terms of financial assistance, development programs and realization of tournaments … raises serious independence issues,” Pieth’s report read.
“…The IGC has worked closely with the Ethics Committee, the Audit and Compliance Committee and FIFA’s administration to ensure that the new governance structures and policies become functional. Special emphasis has been placed on the governance of Development Programs including financial controls over Members Associations…”
When a national association in receipt of FIFA financing also holds a vote in the FIFA presidential election (with another one of them due in May next year) or in ballots for juicy confederation posts then independence must be called into question. Particularly if no one ever checks what happens to the funding FIFA disburses.
The scale of this historical conflict of interest is staggeringly huge: in the first 13 years of this century, FIFA paid out close to $2 billion to its member associations in development funds. In only four years, between 2015 and 2018, there will be $900 million disbursed. Yet traditionally there has been an alarming lack of transparency and accountability. Some payments were made to accounts in the name of other parties than the member association or confederation itself. Even if the account were in the name of the member association, there was no way of checking who the ultimate beneficiary holder of that account was.
If in the face of these temptations there were only five per cent of the $2bn that disappeared into the hands of corrupt individuals, then the opportunity cost to football would be $100 million. However anecdotes such as the one from my African contact suggest football has probably lost substantially more than that over the years.
It is for this reason that the measures FIFA has introduced following the IGC report are to be praised. From January next year all of FIFA’s member associations have been obliged to comply fully with new General Regulations for Development Programmes, rules “with the objective of enhancing their governance structure and compliance”.
The most basic of all checks and balances – that payments must be made to the confederations or member associations and not to their staff or officials – has finally been introduced. The application process for FIFA grants has been refined with more disclosures required and there is a formal tender process for any expenses of $50,000 and above.
But most reassuring is how all 209 FIFA member associations must submit audited accounts and agm minutes for scrutiny by FIFA, and how one-fifth of them are also subject to an audit conducted by KPMG. Funds can be withheld from those who fall foul, or they can be ordered to return what they have already received. In the event of suspected fraud Eckhert’s judicial body becomes involved, with all the disciplinary powers it has at its disposal.
In this interim period before full compliance is expected not everyone could be given a clean bill of health. About one in 10 nations failed to deliver audited reports in a timely fashion. Two that did were subject to sanctions for irregularities. Antigua and Barbuda was handed a $30,000 fine for mortgaging a property it built under the Goal programme without previously informing FIFA. Separately, a forensic audit has been ordered in Nepal after what a FIFA spokesman termed “unappropriated cash movements” were identified.
It seems FIFA suspects Nepalese football to have succumbed to one the great risks of the prior unaccountability: that of cash for votes. The payments it received between 2005 and 2012 under the Goal programme and FIFA’s Tsunami relief fund are also subject to an investigation. That was the period when Manilal Fernando was FIFA’s development officer. As an example of the historical utility of FIFA funding to ambitious individuals, Fernando’s career as a FIFA financier was so successful that he rose to the executive committee in 2010. The crash to earth was just as spectacular, though: Fernando received a lifetime ban from all football activity in 2013 after being found guilty, among other things, of bribery and corruption.
Clearly there is still some way to go at FIFA, and both Pieth and Garcia have wondered publicly whether that will be possible under the current leadership of the organisation, with both intimating that the culture is set at the top. There is also the question of whether self-policing, even with the assistance of local auditors, goes far enough to make cash movements transparent. It would mean a lot more work for FIFA but in this connected world, viewing every cash payment made by member associations with the development finance they receive would not seem beyond the practical realm.
But what is encouraging is that for the first time it will become at least a little bit harder for football’s funds to be misappropriated by the unscrupulous. The opportunity for patronage from those with access to the FIFA coffers towards voting members in national associations is also reduced.
This is truly for the good of the game. One of the three “general objectives” of FIFA’s development programmes is: “To promote football’s values of team play and discipline as well as education, health and well-being.”
It does not require someone of Bill Gates’s formidable intellect to identify that only with transparency and good governance can FIFA be an enabler for that.
Journalist and broadcaster Matt Scott wrote the Digger column for The Guardian newspaper for five years and is now a columnist for Insideworldfootball. Contact firstname.lastname@example.org.