What the Swiss Investigation Into FIFA Boss Sepp Blatter Means

Sepp Blatter Money H 2015

The news of the criminal investigation into Blatter marks the most dramatic development in the unfolding FIFA scandal since last May's early-morning raid.

Could this be the beginning of the end of Sepp Blatter?

Swiss authorities on Friday announced the beginning of a criminal investigation into Joseph S. Blatter, known as "Sepp," the long-reigning president of soccer world governing body FIFA. The investigation — on suspicion of “criminal mismanagement and misappropriation” of funds — is serious and, if the charges are proven, could mean the end of Blatter’s career and even jail time.

It is still a long way from that. Blatter is cooperating with the Swiss police, who interrogated him at FIFA headquarters on Friday. Police also searched Blatter’s office and seized data for the investigation. Blatter has always denied being involved in any illegal activities connected to FIFA, which is at the center of two major criminal investigations, one led by the U.S. Department of Justice, the other by the Swiss. Blatter had been scheduled to take part in a FIFA news conference on Friday, but it was canceled minutes before it was set to begin. FIFA then issued a statement confirming the investigation and interrogation of Blatter.

Swiss authorities named two key allegations against Blatter. One is that he signed a contract selling lucrative World Cup rights for well under market value, allegedly as a backhand deal with former FIFA executive Jack Warner, who in May was indicted by a U.S. grand jury on 12 charges of wire fraud, racketeering and money laundering in connection with the FIFA scandal. The contract, obtained by Swiss broadcaster SRF, which posted excerpts on its website, appears to grant the Caribbean Football Union regional broadcast rights to the 2010 and 2014 World Cups for a total of $600,000. Warner licensed those rights and sold them on for a reported $20 million.

Warner will face an extradition hearing on Dec. 2 which will determine whether he'll be sent to the U.S. to face charges.  

The other accusation put forward by the Swiss is that Blatter made a suspicious payment — of 2 millions Swiss Francs, or just over $2 million — to Michel Platini, a former soccer star and longtime member of FIFA's executive committee as well as the leading candidate to replace Blatter as head of the organization. The so-called “disloyalty payment” to Platini was allegedly for work performed between January 1999 and June 2002 but wasn’t paid until February 2011, just three months before Blatter ran for, and won, a fourth term as FIFA president. The suggestion is that the money was used to prevent Platini from opposing Blatter's candidacy.

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The Swiss authorities have also named Platini as a person of interest and interviewed him on Friday. So far, however, he is not the target of any investigation.

The news of the investigation into Blatter marks the most dramatic development in the unfolding FIFA scandal since last May, when Swiss police, acting on behalf of the Department of Justice, arrested 14 FIFA executives and marketing officials in an early-morning raid on a luxury hotel in Zurich. The FIFA members were there for the organization's annual conference, where, despite the scandal, Blatter was reelected FIFA president. Blatter was not charged at the time, though Swiss and U.S. officials said he would be a target of their investigations.

Now the other shoe has dropped and Blatter is in the line of fire. Despite maintaining his innocence, Blatter has announced he will step down as FIFA boss following a special presidential election, scheduled for February.

The man who has run world soccer since 1998 and built FIFA into a global marketing and money-making machine, will now have to face the full force of the Swiss and U.S. justice departments. The two national investigations are separate but the two nations are sharing information and coordinating their efforts.

In total, U.S. authorities have charged FIFA officials and connected marketing executives of soliciting and receiving more than $150 million in various bribes and kickbacks over the past 20 years.