Geelong Advertiser, Wednesday, 9 August 2006, p. 39.
It’s been a bad few weeks for the image of top-class sport in Australia and around the world. We have had Justin Gatlin, the American sprinter, and Floyd Landis, the winner of the Tour de France cycle race, exposed as having used performance-enhancing drugs to achieve their feats. In Italy, four of the leading football (soccer) clubs have been penalised for attempted match-fixing by ensuring that only certain referees were appointed to officiate at their matches. Closer to home a couple of Collingwood players have been fined by the club after being involved in an early morning brawl outside a night club and a rugby league player is alleged to have assaulted a young lady in Brisbane. Recently Wendell Sailor, the Wallaby winger and former NRL star, was banned for two years for cocaine use. A warts-and-all biography of Shane Warne may add little to what is already known, but it provides an extensive catalogue of the champion cricketer’s off-field womanising while he was married.
But some of the worst scandals are buried away on the financial pages, if they are reported at all. The recent football World Cup was a superb piece of sporting theatre, but the organisation which conducted it, the Federation International de Football Association or FIFA, is riddled with corruption and financial sharp practice. Prior to the tournament a member of its Executive Committee was found to have breached its own code of ethics by selling tickets to the tournament through a family company. The person concerned only escaped punishment by selling his shares in the company so that the President of FIFA, Sepp Blatter, could claim, ‘There were lengthy discussion in the executive committee meeting with interventions from practically every member but the committee was of the opinion that because Jack Warner has sold his shares in the company then there is no more a conflicting situation.’ This was not Warner’s first offence as you can find by reading Andrew Jennings’s expose of FIFA, Foul: The Secret World of FIFA: Bribes, Vote Riggings and Ticket Scandals. Another FIFA Executive Committee member, Ismail Bhamjee of Botswana was forced to resign and ordered to leave Germany after admitting selling tickets for the England versus Trinidad and Tobago match at three times their face value.
More seriously for FIFA, its overall financial position is still much more precarious than many appreciate. Though the World Cup generated huge income for the organisation, the finances of the world body remain a matter of concern. In 2001–02 FIFA was facing a serious financial short-fall in part because of the collapse of entities with which it had been doing business. There was a major controversy over the appropriateness of the measures taken to overcome the financial crisis, but this became bound up in the political struggle over the presidency. When Sepp Blatter won the latter contest he was able to ride out the financial storm in the short run, though according to the most recent official information from FIFA itself, the long-term financial issue will not be settled for some time.
Though its ramifications and processes are highly complex, the essential plank of the Blatter financial manipulation has been the so-called ‘securitisation’ of future income from the World Cup to underpin the current revenue position of the organisation which otherwise would show a considerable deficit. ‘FIFA is therefore seeking to increase its equity to such a level that running costs can in future be financed by the funds remaining from the previous World Cup rather than needing to cover them using prepayments of revenue for the subsequent event. This process will, however, take several World Cup cycles to complete.’ In other words, if normal accounting practices were used the governing body would still be insolvent.
So while the personal scandals make the headlines, the financial ones, which are arguably much more important for the health of sport, don’t get the airing they require, despite pledges of transparency by the leaders of these organisations.