Cayman Finance statement in response to the arrest of FIFA senior officials

“Cayman Finance is saddened to learn of allegations of corruption and money laundering among senior leaders and officials within FIFA,” said Cayman Finance CEO, Mr Jude Scott.

“Our information at this time is limited to that which is in the public domain, however, we are confident the relevant international investigating authorities will follow due process and the appropriate outcomes will be reached.

As a jurisdiction that consistently upholds good governance and transparency that robustly meets globally implemented standards for regulation and cross border cooperation, we are confident that the Cayman Islands authorities will provide effective support to international authorities, to the extent that further cooperation might be required from the Cayman Islands,” he said.

UK offshore tax havens at heart of US investigation into World Cup corruption

From The Observer UK

British Virgin Islands, Caymans and Turks & Caicos feature heavily in justice department indictment of senior football officials

British overseas tax havens play a key role in what US authorities have called “rampant, systemic and deep-rooted” corruption in the world of football, analysis by the Observer reveals.

The 164-page US Department of Justice indictment, outlining the case against the 14 football officials and marketing executives who were arrested last week, shows that three of Britain’s overseas territories – the British Virgin Islands (BVI), the Cayman Islands and the Turks and Caicos, all tax havens – allegedly played a part in masking kickbacks between officials and executives.

The revelation has intensified calls for a clampdown on the offshore banking sector, where campaigners say a lack of transparency and oversight allows bribery and corruption to thrive.

According to the indictment, Costas Takkas, a UK citizen who acted as attaché to Fifa’s vice-president, Jeffrey Webb, used a firm called Kosson Ventures, registered in the BVI and with bank accounts in the Cayman Islands, to allegedly facilitate illegal payments between a South American sports marketing agency, Traffic, and Fifa officials.

John Mann, a Labour MP and Treasury select committee member, said the use of British tax havens made investigating the scandal all the more difficult: “The problem is that the Serious Fraud Office here can’t investigate these tax havens, and that anomaly needs rectifying. They are centres for money laundering in a very big way. We are negotiating to change relations with the European Union, but we should spend just as much time renegotiating the deals with the overseas territories. They are becoming a serious problem for the world.”

The indictment raises questions about whether the banks in the tax havens should have flagged the transactions to the authorities as a potential concern. The indictment states: “On or about November 21, 2012, two wire transfers, of $750,000 and $250,000, were sent from Front Company A’s account at HSBC bank in Hong Kong to a correspondent account at Standard Chartered Bank in New York for credit to an account in the name of Kosson Ventures, controlled by Takkas, at Fidelity Bank in the Cayman Islands”.

A $500,000 payment to Webb was made by Traffic “through the account of another individual, a business associate of Co-Conspirator #2, to another account controlled by the defendant Costas Takkas at Fidelity Bank in the Cayman Islands”.

Another defendant, marketing executive Jose Margulies, had a controlling stake in a firm called Somerton, based in the Turks and Caicos. According to the indictment, Margulies used the accounts of Somerton and a Panama-based firm – referred to by the US authorities as “Margulies Intermediaries” – to “mask the sources and beneficiaries of bribe and kickback payments”. Between March 2003 and March 2008, “Margulies Intermediaries wired more than $3.5m into accounts controlled by the defendants Rafael Esquivel [president of the Venezuelan football federation], Nicolás Leoz [former president of South America’s football confederation] and Eugenio Figueredo [head of Conmebol, the South American football confederation], almost entirely through even, six-figure payments”.

Robert Palmer, head of Global Witness’s money laundering campaign, said: “If you wanted to design a system to weed out corrupt and laundered money, you would do it exactly opposite to the way places like the BVI and Cayman Islands are set up. They may have a veneer of light-touch ‘regulation’, but secrecy is hardwired into their DNA and it can be almost impossible to get information out of these islands.”

The use of the Cayman Islands to facilitate the allegedly corrupt transactions appears to have been longstanding. The indictment states that, in 1999, “Traffic caused $200,000 to be wired to a correspondent account at Barclays Bank in New York, for credit to an account held in the name of an entity controlled by Co-Conspirator #1 at Barclays Bank in the Cayman Islands.”

In 2012 Webb emerged as a candidate to succeed Jack Warner as president of Concacaf, the federation representing the North and Central American and Caribbean footballing nations. According to the US authorities, “an executive at Traffic USA supported Webb’s candidacy by causing $50,000 to be paid from Traffic USA’s operating account to a Caymanian company” controlled by Takkas.

Some of the money channelled through Britain’s tax havens was allegedly funnelled into property. Takkas transferred funds from his Kosson Ventures account at Fidelity Bank in the Cayman Islands to SunTrust Bank in the US, allegedly to help Webb buy luxury homes in Stone Mountain, Georgia. The use of Kosson Ventures in the scheme was “intended to conceal the fact that the defendant Jeffrey Webb was the beneficiary of the payment”, according to the US prosecutors.

The Cayman Islands also played a role in a bribery scheme to allegedly persuade Fifa officials to vote for the 2010 World Cup to be held in South Africa. Warner is alleged to have promised one official $1m in return for his backing South Africa. It is claimed that “the first payment in the amount of $298,500 was made by wire transfer sent on or about December 19, 2008 … to a Bank of America correspondent account in New York, New York, for credit to an account controlled by Co-Conspirator #1 at a bank in the Cayman Islands”.

Experts said the use of offshore accounts to facilitate corruption hit poor nations hardest. Joseph Stead, economic justice adviser at Christian Aid, said the government needed to send a consistent message. “The UK government has rightly urged Fifa to uphold the ‘highest standards of governance, transparency and accountability’, but this would carry more weight if the UK required the same of its overseas territories. It should start by ensuring that they make public the owners of the hundreds of thousands of companies they host. This would help remove the opportunity for those tempted to engage in corruption and tax evasion.”

IMAGES:                                                                                                                                                           George Town in Grand Cayman on the Cayman Islands. Photograph: Walter Bibikow/JAI/Corbis        Providenciales island in the Turks and Caicos. Photograph: Hemis /Alamy

For more on this story go to: http://www.theguardian.com/football/2015/may/30/british-offshore-tax-havens-investigation-world-cup-fifa

Fifa re-elects Sepp Blatter as president

From BBC

Sepp Blatter has been re-elected president of Fifa, football’s world governing body, in a vote overshadowed by arrests and corruption allegations.

Mr Blatter’s rival, Prince Ali bin al-Hussein of Jordan, withdrew after the first round of voting.

Mr Blatter fell seven short of the two-thirds needed, but Prince Ali opted not to contest further.

Seven top officials were arrested in Switzerland on Wednesday as part of a US prosecution that indicted 14 people.

Mr Blatter, 79, has faced calls to resign, including from UK Prime Minister David Cameron, who said in Berlin on Thursday that the Fifa president should quit “the sooner the better”.

‘Nobody is perfect’

But Mr Blatter hailed his victory, thanking all those who voted from him and his rival, Prince Ali.

Mr Blatter said: “I am not perfect, nobody is perfect, but we will do a good job together I am sure.”

He also hinted that this term in office, his fifth, could be his last, saying: “At the end of my term I will give up Fifa in a strong position.”

Analysis: Matthew Kenyon, BBC Sport

If you read most of the world’s media, Sepp Blatter’s ability to hang on to power at Fifa is nothing short of miraculous.

After years of negative headlines, the frenzy has reached fever pitch in the wake of the US allegations of corruption – even though Mr Blatter himself has not been implicated. And running through all this is a theme – bemusement that much of the football world keeps voting for him.

Nowhere is Sepp Blatter’s support stronger than across Asia and Africa. So why do most of the representatives from those two continents appear to be voting for him again?

Here’s about as succinct an answer as you’re going to get – from the president of the Nigerian Football Federation: “Blatter feels Africa. What Blatter pushes is equity, fairness and equality among the nations.”

We’re talking about two things – the first is concrete investment, often literally so. The second is respect.

Why Africa backs Blatter

South Africans shocked by scandal

How Fifa spends its money

In conceding, Prince Ali said: “It’s been a wonderful journey… And I want to thank in particular those of you who were brave enough to support me.”

Global citizens’ movement Avaaz, which started the #BlatterOut campaign, quickly condemned the re-election.

Campaign director Alex Wilks said: “More dirty dealings in Fifa’s halls have crushed the hopes of billions of football fans.”

The vote took place at Fifa’s congress in Zurich. In the first round Mr Blatter won won 133 to Prince Ali’s 73, just short of the 140 votes needed for an outright win.

The two candidates had earlier delivered final appeals to the electors.
The current and former Fifa executives indicted include Rafael Esquivel, Nicolas Leoz, Jeffrey Webb, Jack Warner, Eduardo Li, Eugenio Figueredo and Jose Maria Marin

Prince Ali, 39, said questions had been raised in recent days “about whether our Fifa family is morally bankrupt”.

“There are no easy answers and no blame that can be cast that will wash away the stain that marks us all,” he said.

Mr Blatter declared: “I am being held accountable for the current storm – so be it, I will shoulder the responsibility. I will take it upon myself and I want to fix Fifa together with you.”

To applause from a large number of delegates, he said: “I would like to stay with you. I would like to continue with you.”
Swiss inquiry

The vote comes two days after seven top officials were held in Zurich in a US fraud inquiry that indicted 14 people.

They are accused of bribery, racketeering and money-laundering involving tens of millions of dollars since 1991.

The aim of the bribes was to influence the outcome of bids to stage football tournaments such as the 2010 World Cup in South Africa and the 2016 Copa America in the US, prosecutors say.

Swiss prosecutors have launched a separate investigation into the bidding process for the World Cup tournaments in 2018 in Russia and 2022 in Qatar.

Many of Fifa’s major sponsors, including Coca-Cola, Visa, Adidas, McDonald’s, Hyundai Motor and Budweiser, have expressed concern over the investigations.

After Mr Blatter was re-elected, Coca-Cola said in a statement that Fifa “must now seize the opportunity to begin winning back the trust it has lost”.
‘Movement for change’

Michel Platini, president of the European football governing body Uefa, praised Prince Ali.

“I am proud that Uefa has defended and supported a movement for change at Fifa – change which, in my opinion, is crucial if this organisation is to regain its credibility,” he said.

Mr Platini had called on Mr Blatter to resign on Thursday.

Greg Dyke, the chairman of the English Football Association, told the BBC: “Sepp Blatter has run this organisation for 16 years, and for all of those 16 years, there have been levels of corruption.

“Sepp Blatter is not the man who is going to be able to change that.”

For more on this story go to: http://www.bbc.com/news/world-europe-32937639