For every bribe recipient, there is a bribe payer, and the Foreign Corrupt Practices Act focuses on the conduct of the payor, not the recipient. One of the reasons the original round of arrests in the FIFA corruption scandal was focused solely on individuals was that they were the ones alleged to have received the bribes. However, that direction may be shifting. A recent report says that the Justice Department has begun to look at the “role of multinational sponsors, broadcasters, and banks” in facilitating the corruption.
That the investigation has made this shift is not surprising. However, the extent of the government’s probe may well be. Further, the article says: “it remains unclear if the companies are the focus or if prosecutors are just seeking cooperation.” While the companies under Justice Department scrutiny were not named in the article, it did note that “at least 11 multinational companies and banks have commissioned” internal investigations. Some of them include Nike, DirectTV, 21st Century Fox, KPMG, Citibank, HSBC, Standard Chartered, Credit Suisse, and UBS.
The message is quite clear for all U.S. companies that did business with FIFA, regional soccer organizations such as CONCACAF, and the national soccer federation: You need to get out ahead of the government probe now by investigating any business dealings you might have had in this arena. Most critical are any dealings you had with third parties, which might have facilitated any transactions. This would include sports marketing firms and companies that may have been involved with buying or selling broadcast rights.
It turns out that in at least one country, Argentina, those broadcast rights are held by the Argentinian government, so there is clearly FCPA jurisdiction. The Panama Papers release has also played a role in this widening investigation, as the documents may “detail money flows and entities involved in the alleged scheme.” Several of the banks under investigation have entered into DPAs for other money-laundering issues, so this new investigation could pose further questions and risks.