Friday, March 29, 2024
HomesportsThe banks and brands sweating on FIFA probe

The banks and brands sweating on FIFA probe

Some of soccer's biggest sponsors have been quick to show their dismay at the corruption allegations against high-ranking FIFA officials. But the finer details of the indictment appear to implicate one U.S. household name in particular.

The 161-page document released by the U.S. Department of Justice (DOJ) claims that a multinational sportswear company headquartered in the U.S. was involved in "bribes and kickbacks" which were used to sign a sponsorship deal with the Brazilian national soccer federation in 1996.

It doesn't name the company, just calling it sportswear company A, but Nike's own website states that the sports brand signed an apparel licensing deal with Brazil's soccer team that year. The indictment highlights that the sportswear company made payments to a sports marketing firm. The DOJ does not suggest that these payments were illegal but claims the marketing firm then used them as bribes for FIFA officials.

Nike told CNBC via email that the implications spotlighted in the indictment do not allege that Nike engaged in criminal conduct. "There is no allegation in the charging documents that any Nike employee was aware of or knowingly participated in any bribery or kickback scheme," a spokesperson said.

Read MoreWhy the US is leading the charge against FIFA

"Nike believes in ethical and fair play in both business and sport and strongly opposes any form of manipulation or bribery. We have been cooperating, and will continue to cooperate, with the authorities," the spokesperson added. Shares of Nike dipped slightly Wednesday and Thursday.

Wall Street banks named

Pablo Barrientos of San Lorenzo tackles Mario Bilen of Auckland City during the FIFA Club World Cup Semi Final match between CA San Lorenzo and Auckland City FC at Marrakech Stadium on December 17, 2014 in Marrakech, Morocco.Chris Brunskill Ltd | Getty Images

The arrests of seven FIFA officials on Wednesday morning marked the opening of two separate investigations into alleged corruption at world soccer's governing body. U.S. authorities are focusing on alleged wrongdoing that spans the last 24 years while Swiss regulators are directing their efforts on the bidding processes of the next two World Cups in Russia and Qatar.

The DOJ claims that vast sums of money changed hands in the U.S. between sports marketing firms and FIFA officials from its regional branch called CONCACAF (the Confederation of North, Central America and Caribbean Association Football). In the indictment, it names several Wall Street banks that were allegedly used to funnel money between different parties although they are not accused of any wrongdoing.

Citibank, JPMorgan Chase and HSBC are named in the document as well as UBS, Bank of America, Espirito Santo Bank and Julius Baer. A spokesperson for Citi told CNBC on Thursday morning that the bank has been "cooperating with the Justice Department during their investigation" while JPMorgan and HSBC declined to comment.

FIFA has expressed its relief at the two investigation, trying to put a positive spin on what is undoubtedly a very difficult time for the organization. Presidential elections are still scheduled to go ahead this week despite the scandal and there are also no plans to change the host nations for the next two tournaments.

FIFA President Sepp Blatter, who was not charged, said Thursday " it is necessary to begin to restore trust in our organization."

Read More FIFA's Blatter: I can't watch everyone all the time

'Listen and learn'

RELATED ARTICLES
- Advertisment -

Most Popular