Seb Coe’s Biggest Challenge

In mid-September 2006 Lord Coe, public supremo of the successful London 2012 Olympic bid, turned down the opportunity to become chairman of UK Athletics. Sport journalists had widely assumed that Coe would slot into this made-for-Seb post, after Dave Moorcroft’s resignation as the chief executive of UK Athletics in August. But Lord Coe had bigger things on his plate, having spent some time the previous week in Zurich at the headquarters of FIFA, the world governing football body. FIFA’s president Blatter beamed with pleasure on announcing that Coe had accepted the offer to head up FIFA’s new ethics commission. The double-gold medallist and IOC (International Olympic Committee) member will have a lot on his plate. Not the existing cases of ethics in FIFA’s files – such as Trinidad & Tobago soccer boss and FIFA vice-president Jack Warner and his alleged ticket dealings – but any forthcoming ethical matters across world football. One wonders whether Lord Coe has reflected fully upon the context of his new responsibility. The text below is the English-language basis of a piece published in Berlin daily Der Tagesspiegel just before the World Cup in Germany. It could be enlightening reading for Lord Coe: perhaps even Seb’s powers of persuasion – famously allied with Tony Blair’s charm and power in the hotel rooms of Singapore in July 2005 – will be stretched to their limits in his new role. He might not have far to travel beyond FIFA House itself in rustling up business for his new commission.

Fifa and Its Partners

There were no unseemly tussles for power in Berlin during the days before the World Cup Finals kick-off on Sunday June 11. FIFA had changed its long-standing tradition of holding its elections for the presidency at its congress on the eve of the big event. It attracts too much of the wrong kind of publicity for the likes of FIFA president Joseph ‘Sepp’ Blatter, who will look to coast confidently through his third World Cup Finals since being elected at the Paris congress preceding the 1998 finals. His predecessor, Brazilian Dr João Havelange, gained the position in 1974 and presided – unopposed at five elections – throughout a further five Finals. Between them Blatter and Havelange will have controlled the governing body of the world game for almost a third of a century, during which time Germany will have had 4 heads of state, the United Kingdom 5, and the USA 6. But Blatter was peering over his shoulder in the summer of 2006, looking anxiously away from the playing fields of Germany, monitoring the fall-out from the legal investigation in Switzerland into the collapse of marketing giant International Sport and Leisure.

Winning the World Cup in 1974, the Federal Republic of Germany was complimented by Havelange for the organising committee’s achievements: ‘I presuppose that it was generally accepted as spectacular … Indeed, it would be a considerable advantage, if one were to accept the organisation … in 1974 as a starting-point and example for future World Cup tournaments’. Havelange had cause to remember Frankfurt with fondness, as the climax of his campaign to oust the Englishman Sir Stanley Rous. Havelange had travelled the world for several years, making deals with his South American allies, promises to third world countries, and commitments to the expansion of international football’s highest-profile event: Argentina marched controversially to the world title on home territory in 1978; the number of participants in the Finals was increased from 16 to 24 for the 1982 Finals in Spain, and to 32 for France ‘98. Sponsors were attracted, and television deals achieved, that would have looked like fantasy projections back in the days of Rous. Throughout this, Havelange and Blatter, the Batman and Robin of world football governance, held off challenges from Europe and Africa, and sustained for themselves the glamorous, cocooned and privileged lifestyle to which the bosses of international sports organisations were becoming increasingly accustomed. In achieving this, they worked in close partnership with International Sport and Leisure (ISL), a marketing company that, until its liquidation in May 2001, was the conduit for many millions of the FIFA monies that were flowing into the world game in its expansionist boom years.

There’s a man in the middle of this extraordinary story: Horst Dassler, of adidas, who at the age of 20 was getting Olympic athletes on to his illegal books at the Melbourne Olympic Games of 1956. Havelange had made bold promises, introducing new international tournaments for younger players, staging them in novel venues such as the Gulf States as a thank-you to those who had helped him in to office. But FIFA had been far from prosperous in 1974 and Havelange needed two things in order to keep his promises: a trusted lieutenant within his administration; and a source of external income with which to make his manifesto happen. Initially Coca-Cola provided the latter, and Sir Stanley Rous’s old general secretary Dr Helmut Käser kept FIFA House in Zurich ticking along. Soon, though, Havelange turned to Dassler, who had watched the Brazilian’s successful campaign, as the go-between to transform FIFA’s fortunes: Dassler and Havelange handpicked the young Sepp Blatter to groom him for the future. Within a few years, Blatter had joined FIFA, married Käser’s daughter, and taken over his father-in-law’s post. Blatter’s marriage, once he’d landed the top job, wasn’t to last long: but his relationship with Havelange was.

These were the years in which get-rich-quick merchants moved in on the innocent world of sport. Just down the road in Switzerland, at Lausanne, the International Olympic Committee (IOC) was going commercial. The IOC president, former loyalist in General Franco’s fascist administration, Juan Antonio Samaranch, was installed in 1980, and had no worries about moving on from the old days of amateur idealism, putting a FIFA-style plan in place to secure huge sponsorship sums from selected corporations, and selling the television rights for the games for unprecedentedly large sums. At the heart of these deals was Dassler, known for his ‘little black book’ of addresses and contacts. ISL was never directly Dassler’s company, but was widely known to be his brainchild as marketing agencies became the key intermediary in the new economics of sport. UEFA bosses were later to refer to ISL as FIFA’s ‘black box’ of laundered finances.

In the spring of 1983, the IOC made its initial deal with ISL, giving the company the brief to manage its marketing and licensing deals. ISL had already been handling both UEFA’s and FIFA’s advertising and merchandising rights, and saw the Olympics as the as yet ‘least exploited property’. Dassler established the company in Lucerne, Switzerland, and put one of his adidas henchmen, Klaus Hempel, in charge. Swiftly, ISL gobbled up marketing rights to sport and by 1985 dominated the lucrative international events in the Olympics, football and athletics. Dassler was the catalyst, and the networks of the new sports moneymen were peopled by graduates of the adidas academy. Blatter was a classic protégé, plucked by Dassler from his marketing post at Swiss Longines, and sent for training at adidas’s Landersheim headquarters. Trained there in the autumn of 1975, he then operated as FIFA’s technical director until 1981, travelling the world on behalf of Havelange’s developmental programme, and polishing his marketing pedigree in his commitment to the Dassler dream of global sports-marketing domination: ‘I will never forget adidas because, I repeat, without adidas we wouldn’t have had this development programme. Without adidas I think that FIFA would not be where she is today.’

Blatter and Dassler, who died in 1987, were born within days of each other, as Blatter himself put it, in March of ‘the beautiful year of 1936’, coincidentally the year when Havelange was enjoying the hospitality of his German hosts at the Hitler Olympics. They might have been the same age, but Blatter talks of Dassler with passion, awe and an almost filial piety: ‘He was an extraordinary man, a man of courage, of initiative, a visionary … adidas, the father of sport sponsoring. One can never repeat this enough.’ His passion for and loyalty to Dassler spilled over into the ISL years and the time after Dassler’s death. Blatter called the FIFA-ISL relationship a ‘sweetheart’ relationship, ‘like a Venetian night of love’. Cornered in conversation by a BBC2 journalist, Blatter conceded that the love affair had faded, that ISL had diverted monies, and that he and FIFA learned of this in the early months of 2001, from Brazilian television company O Globo. ISL had collapsed with debts of more than 450 million Euros, but could also not account for some 75 million Euros from the television contract with O Globo. Blatter had little choice but to turn on his long-standing cronies, and FIFA lodged the criminal complaint in Switzerland that was to lead, four years on, to charges against several of ISL’s top executives. In December 2001 eleven members of FIFA’s executive committee wrote to Blatter in exasperation, still ‘not clear on the income lost to FIFA in relation to the collapse of ISL’, and also expressing a ‘continued concern … in relation to the number and role of Presidential advisers, who remain unaccountable to the official bodies of FIFA.’ In January 2002 the big-hitting executive committee member Dr Chung Mong-Joon from South Korea wrote to the president of the central and North American confederation Jack Warner: ‘I would like to emphasize that the management of FIFA’s finance is flawed and the lack of transparency is at the root of current speculations’. FIFA general secretary Michel Zen-Ruffinen told the executive committee, in May 2002, how Blatter had struck deals and ‘employment agreements with former ISL managers’, with no reference to the director of human resources or Zen-Ruffinen himself; he also outlined Blatter’s plan to arrive at a settlement with the ISL administrators ‘under which FIFA will have to pay around CHF 40 million to the bankruptcy estate’, writing off 251 million of its initial claim against ISL.

Blatter’s loyalties were re-surfacing: in June 2004 FIFA requested that the criminal investigation be curtailed, making a mockery of the claim in its centennial history, published in 2004, in relation to ‘rumours of corruption and vote-buying’, that ‘all the accusations have always eventually been withdrawn’. The missing 70 plus million Euros still under investigation in the ISL case shows the shallowness of this claim. ISL top man Jean-Marie Weber has even been implicated in the payment, by Blatter’s long-term personal lawyer, of 2.5 million Swiss francs into the account of the ISL liquidator. This happened just months before FIFA’s request that the criminal investigation be stopped. The lawyer, Prof. Dr. iur. Peter Nobel, had been busy the previous year too, serving a court order on behalf of both FIFA and Blatter in May 2003, in an unsuccessful attempt to stop publication of my book Badfellas.

Some sports organisations had seen ISL getting too bloated. Dick Pound, marketing guru and vice-president at the IOC, ended the cosy relationship and brought the marketing function inside the IOC: FIFA, he said, had become careless in its trust in an over-expanding ISL. FIFA moved too late, the omata networks of its inner circles and so-called partners inextricably interlinked in years of insider dealing and dodgy accounting. ‘Unity is the most highly valued quality within every organization’, Havelange proclaimed to the South American confederation prior to the 2002 World Cup Finals. How Blatter must have wished, as he lined up alongside his mentor in Ascuncion, Paraguay, that he’d brought the marketing function in house years ago.

Blatter himself has spoken of greed in modern football, and in a barely hidden condemnation of UEFA, the European football federation, has talked of the ‘economic rape’ practiced by ‘neo-colonialists’ of the European game, in its recruitment of players from under-developed countries. Havelange’s protégé often speaks before he thinks, whether on the abolition of national anthems at international matches, or the playing kit of women footballers that he has said should be as skimpy as can be. The FIFA president, seen by many of the grizzled survivors and veterans of football’s global political games as lacking in presidential gravitas, would do well to think before he issues his edicts. His own salary was a reported 20 million US dollars over 6 years from his election in 1998, even though a presidential term is only 4 years. The executive committee was never consulted or informed on the ‘principles or amounts’ relating to this remuneration.

Greed in modern football has been established as the career norm of a generation of sporting administrator and entrepreneur both facilitated and personified by Blatter himself. He sits alone on weekend afternoons in his presidential office in the bunker overlooking Lake Zurich, an emperor without court, abandoned by his young wife. As the headline flashed across the news services on November 12 2002 – ‘Four former ISL executives arrested over FIFA complaint’ – the words of Niccolo Machiavelli may have come to haunt Blatter. The chronicler of the Borgias noted that you should either treat men well or crush them, for ‘they can avenge themselves of lighter injuries, of more serious ones they cannot’. Not crushing his allies from the ISL debacle could well prove Blatter’s fatal error, if Jean-Marie Weber and others choose to tell the Swiss courts more than has yet been told about the irregularities at the core of FIFA finances.

© Alan Tomlinson, September 2006

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