Blatter’s first re-election: May Days 2002


Staying power

When Sepp Blatter’s first term as president of FIFA was coming to a close, just before the 2002 World Cup Finals in Korea/Japan, he was mired in controversies related to FIFA’s financial problems, based in large part upon the collapse of International Sports and Leisure (ISL), the sport marketing company that for close on two decades had dominated the economics of world sport in an expanding landscape of international coverage of sport and a globalizing media market. ISL was in the 1980s the new player in international financial brokerage of sport’s expanding global market, the brainchild of adidas’s Horst Dassler, the man widely credited with a little black book of addresses and contacts of sport federation leaders, media executives, sport agents/entrepreneurs, and sponsors that would reshape the political economy of world sport. Blatter survived of course, and in these reflections on his survival strategy and success I draw upon three sets of documents: first, papers compiled by the then General Secretary of FIFA, Michel Zen-Ruffinen, for the FIFA Executive Committee (ExCo) meeting of May 3rd 2002; second, a set of papers comprising a “Criminal Complaint” by 11 ExCo members, against Blatter, and presented to Zurich’s Public Prosecutor’s Office on 19th May 2002; and third, a set of legal papers delivered to my home address on 22nd August 2003, from Nobel and Hug solicitors, Zurich, on behalf of two plaintiffs, these being FIFA and Blatter himself, constituting an application for an injunction against the co-authoured book Badfellas: FIFA Family at War. Readers can see my book FIFA: The Men, the Myths and the Money (Routledge, 2014), for more detail on these documents, particularly Chapter 7 on ‘Crises’. Here, I summarise some key points from these sources, and then ask how and why Blatter, exposed as he was in this situation, and resorting to legal action to seek to silence critical commentary on his presidency, could himself avoid any form of accountability to or within his own organization, in terms of any long-established disciplinary procedures that FIFA had in place before the belated introduction of an ethical process in 2004. It is worth reminding ourselves that these questions long pre-date the controversies of World Cup hosting decisions, or the redacteur farces and excesses of the Eckert whitewash of the Garcia report (the latter being the Report on the Inquiry into the 2018/2022 FIFA World Cup™ Bidding Process prepared by the Investigatory Chamber of the FIFA Ethics Committee November 13 2014).

May days

Back in 2001, following the collapse of ISL, and the challenge launched to Blatter’s presidency by the president of the African Football Confederation (CAF) Issa Hayatou, FIFA’s ExCo felt emboldened to challenge Blatter’s position. Eleven complainants (almost half of the 24 members of the committee) took a form of legal action against Blatter on 10th May 2002, signing up to documentation delivered to the Public Prosecutor’s office in Zurich by lawyer Prof. Dr Rainer Schumacher. This document, referring to “§ 20 para. 1 Swiss Criminal Code”, amounted to an accusation of extensive criminal conduct by Blatter in relation to his position as FIFA president. The complainants included Swedish UEFA president Lennart Johansson, AFC (Asian Football Confederation) president Dr Mong Joon Chung from Korea, and Cameroonian Issa Hayatou – the presidents of the three largest continental confederations, all three holding Vice-Presidential positions on the ExCo. So the senior figures in this group of 11 represented, in their positions within FIFA and the confederations, close to 150 of the national associations constituting the membership of FIFA, considerably more than the two-thirds of the electorate that would be required to oust a FIFA president in a vote in Congress. The 11 signatories included two further Vice-Presidents of the Committee, lawyer David Will from Scotland, and industrialist Antonio Matarrese from Rome, Italy. This group granted powers of attorney to Schumacher to “file the present criminal complaint”. The criminal complaint was made in the context of FIFA’s status as defined by the Swiss Civil Code, in that “Swiss law is therefore applicable to its legal relationships, and in particular to its legal relationships in private law.” Adding to the context, Schumacher noted that the basement of FIFA’s Pilatus Building in Zurich, where the organisation’s “archive is to be found”, had recently been rendered inaccessible by the instructions of FIFA’s Finance Director Urs Linsi to change the locks, “so that the files are not currently accessible”.

The ISL/ISMM Group, based in the canton of Zug, had gone bankrupt in May 2001; and the Kirch Group, Munich, had collapsed in early 2002. These circumstances, the complaint claims, rendered FIFA’s financial situation “totally impenetrable”, as the bankrupt companies held the marketing rights for the 2002 and 2006 World Cups. Despite this huge crisis of financial management, in what the complaint calls the “initial situation”, “the Accused [Blatter] was practising favouritism with FIFA assets in order to build up an autocratic power base (which is contrary to the Statutes) and in order to secure his re-election on 29 May 2002”. FIFA was hovering on the edge of bankruptcy and the “FIFA Executive Committee’s requests for information were either ignored or put off or fobbed off with global statements to the effect that the FIFA was in perfect financial health”.

Blatter, the case argues with detailed reference to FIFA’s statutes, “cannot take any presidential decisions. Under the FIFA Statutes, he does not possess any presidential decision-making powers”. Such powers lie, “to a very great extent”, with the ExCo, “the executive body of FIFA”; and the Congress (comprising a representative of each member national association) is the “supreme authority” of the organisation, also having “financial sovereignty”. But none of this, the Criminal Complaint claimed, inhibited Blatter from engaging in practices “concerning SUSPICION OF BREACH OF TRUST … AND DISHONEST MANAGEMENT”.  

Having described the initial situation, the document proceeded to describe Blatter’s weaving elusiveness when asked by the ExCo to account for the financial situation. At the FIFA Congress in Buenos Aires in early July 2001, the ExCo asked Blatter to explain the financial situation:

"On 7 July 2001, FIFA President Blatter promised that he would have FIFA’s financial situation analysed by an external auditor and publish the resulting audit. The report presented by KPMG Fides Peat, Zurich, on 22 October 2001 (as at 30 June 2001) was utterly worthless, however. That report did not provide the basis for any evaluation of FIFA’s financial situation. The auditors had restricted themselves to verifying the technical correctness of the balance sheet and had covered themselves with considerable reserves."

“Constant stalling and vanishing tactics” increased “the mistrust of numerous members of the Executive Committee”, the Complaint notes, and a majority of its members resolved to act, calling for an extraordinary meeting of the committee in order to appoint an ad hoc committee “to audit FIFA’s financial situation”.  Blatter, with no right so to do, ordered the “suspension” of this internal audit committee (IAC) in April 2002. That committee had been planning to interview, as part of the audit, both Linsi the financial  director, and Zen Ruffinen the general secretary. Blatter’s illegitimate move to “suspend” the work of the IAC therefore had, it was alleged, “the aim of keeping secret the financial situation of FIFA and his own financial machinations”.

The Criminal Complaint then catalogued a series of activities, many documented and evidenced by Zen-Ruffinen in his “strictly confidential” paper to the ExCo. These included the disappearance of files from FIFA headquarters; the exclusion of the General Secretary from financial matters and decisions; payments to individuals for imprecise services, for the supply of information that could incriminate other individuals, and for use of a name in the presidential election campaign. The document notes too that some evidence had disappeared of such payments, “since access to” the FIFA accounts “was denied … by Sepp Blatter and his people … and is now available only to ‘faithful followers of Blatter’”. In this list of abuses of leadership and management, and accounts of financial maladministration, the following are just some of those implicated: the Trinidadian Jack Warner and his family; previous president Dr João Havelange; Liberia’s then Football Association president; and Blatter himself in relation to his personal salary. On the latter, Blatter has clearly been a financial rule unto himself:

"The Executive Committee does not have access to any documents which would allow the Complainants to acquaint themselves with firstly, Mr Blatter’s agreements with FIFA and, secondly, the effective payments made to Mr Blatter and debited to FIFA, and to compare the two. In view of all the circumstances, there is a compelling suspicion that, with his secrecy tactics, Mr Blatter is seeking to cover up unlawful personal emoluments."

Zen-Ruffinen’s report to the ExCo also documented “abuses of the Projects GOAL and FAP”. The Financial Assistance Programme and the GOAL initiative were, “as a matter of fact”, used by Blatter in campaigning for the re-election:

"The prioritization of the needs analysis of countries was changed by the President in the presence of witnesses according to his travel schedules so that he could inform each visited country that it had been selected for the programme. For example, Cameroon was replaced by Burkina Faso, Congo DR by Cape Verde, Angola by Botswana."           

The Criminal Complaint was not progressed, and plaintiffs Blatter and FIFA could claim later in the year, in their application for an injunction against Badfellas, that the complaints process had been “abated”; but no counter-evidence was cited or presented to contest the complainants’ core claims. Three weeks later in that fateful May, Blatter was re-elected by 139 votes to 56, an increase on his majority in 1998 when he gained 111 to Johansson’s 80. Omertà, rather than transparency, would be the outcome of the FIFA congress as Blatter’s beneficiaries, supplicants and supporters granted him his second term.

Ethical unaccountability

How could Sepp Blatter survive the scandals and the storms of his first presidential re-election? With such a catalogue of allegations and evidence how could he escape the sanctions of organizational transparency and accountability? The May Days uprising of the ExCo in 2002 proved short-ter, and Blatter entered a second tem in which he introduced, initially in 2004, an Ethics Committee and consequent revisions to ethical processes. In the 2009 edition of the FIFA Code of Ethics, though, Article 2 stated that the code could not be retrospectively applied “to facts that have arisen after it has come into force”. So Blatter could wipe the slate clean, play the reformer, and continue business as usual. But what about the disciplinary committee that had for a long time been in place, prior to the introduction of any explicit ethics process?

            In the years of activity to which the Criminal Complaint refers, Blatter himself was surely in breach of basic disciplinary procedures. Yet it has become increasingly difficult to find or gain access to the Disciplinary Committee briefs of the time. As the Criminal Complaint itself showed, FIFA operatives have purged administrative records, restricted access to documents and evidence, and perhaps the versions or editions of the Disciplinary Committee pertaining to the years 2001 and 2002 have been the focus of some of these processes. But we do have access to some of the formulations of the Disciplinary Committee, in place before Blatter himself succeeded to the presidency in 1998 and some beyond the early years of his presidency.

            On 4th December 1992 Blatter himself, as General Secretary, was the co-signatory with Havelange for FIFA’s 22-page Disciplinary procedures: List of disciplinary measures, and accompanying regulations. The procedures are framed primarily in relation to players and teams but more generally “natural persons” are also identified as answerable to the procedures, and subject to sanctions, such as “a temporary or lifelong suspension from all official functions”. But the procedures, in a relatively short pamphlet, refer primarily to external bodies, to national associations and the confederations, rather than FIFA itself. During Blatter’s occupancy of the presidency the Disciplinary Code has expanded to around 80 pages, and the 2005 edition was 48 pages. The latter, in Article 59, Section 6 on corruption, stated that: “Anyone who offers, promises or grants an unjustified advantage to a body of FIFA, a match official, a player or an official on behalf of himself or a third party in an attempt to incite it or him to violate FIFA regulations will be sanctioned”, with a fine and bans on involvement in any football-related activity and on entering any stadium. Article 3 (f), on the “scope of application: natural and legal persons” stated that “anyone with an authorisation from FIFA, in particular with regard 
to a match, competition or other event organised by FIFA” is subject to the code.   Perhaps there was a moment, back in 2002, when Zen-Ruffinen and the ExCo could have turned the Disciplinary Code upon the President, citing the cases of “general mismanagement, dysfunctions in the structures and financial irregularities”, as Zen-Ruffinen described the situation, as cause for internal investigation via FIFA’s own statutes and processes. If a copy of the 2001 or 2002 Disciplinary Code materializes, and we see a parallel section on corruption, perhaps a Disciplinary Committee with teeth, concerned with more than just infield matters and player conduct, could challenge the cunning survival skills of Blatter, demanding in retrospect that Blatter be called to account for his practices in terms of FIFA’s own internal procedures. But one of those practices has been to destroy or secure key sources, and FIFA will need fewer supine employees and officials, some brave enough to face the consequences of whistle-blowing, if there is to be any serious internal challenge to the octogenarian who has, to quote Zen-Ruffinen once more, and “against the statutes”, taken over “the management and administration of FIFA combining both, thereby working with a few persons of his trust only and manipulating the whole network through the material and administrative power he gained to the benefit of third persons and his personal interests. FIFA today is run like a dictatorship”.