FIFA bust legal strategy: The Department of Justice is using RICO to save soccer.

The Brilliant Legal Strategy Behind the FIFA Bust

The Brilliant Legal Strategy Behind the FIFA Bust

The law, lawyers, and the court.
May 28 2015 2:53 PM

The Brilliant Legal Strategy Behind the FIFA Bust

FIFA isn’t the culprit—it’s the victim.

Fifa bad.
FIFA, meet RICO. A kiosk in Rio de Janeiro shows newspapers blaring about the arrests of FIFA officials, on May 28, 2015.

Photo by Yasuyoshi Chiba/AFP/Getty Images

The stunning arrests of FIFA’s top brass at a glitzy Swiss hotel at dawn on Wednesday were widely heralded as a move against the international soccer juggernaut itself. In Slate, Stefan Fatsis wrote a story with the headline “The American justice system could actually bring down mighty FIFA.”* CNN announced that the United States is “bringing down the hammer on FIFA.” A New York Times editorial praised the Justice Department for taking “aggressive action” against “FIFA’s corruption.”

Mark Joseph Stern Mark Joseph Stern

Mark Joseph Stern is a writer for Slate. He covers the law and LGBTQ issues.

Wednesday’s bust may lead to the collapse of FIFA—but the legal theory behind the prosecution of FIFA’s leaders rests on the opposite premise. The Justice Department says it isn’t trying to bring down FIFA; it’s trying to save it. And it has decided to do so by arresting, prosecuting, and (with luck) imprisoning a stunning array of the organization’s most powerful leaders.

The roots of America’s FIFA bust lie in a 1970 law called the Racketeer Influenced and Corrupt Organizations Act. Congress passed RICO to help frustrated prosecutors take down the Mafia. Individual mobsters’ crimes were often difficult to prosecute in isolation from the Mafia’s broader criminal conspiracies. RICO allowed prosecutors to essentially put the Mafia on trial by tying together different mobsters’ crimes as part of a broad “criminal enterprise.” The law held mob bosses accountable for the criminal acts they ordered their minions to commit, since their coordination furthered the aims of the conspiracy. And once the RICO prosecution got rolling, attorneys could bring into the trial any fact that corroborated the existence or operation of the criminal enterprise.

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But RICO reaches far beyond the Mafia. Almost any association of people can qualify as an “enterprise” prosecutable under the law, from anti-abortion activists to police officers. And once someone is a member of that “enterprise,” he or she is responsible for the entirety of the conspiracy’s actions—so long as he or she was aware of the general purpose of the enterprise and agreed to further it in some way.

Given all the speculation over the years about bribes, vote trading, game throwing, and other potentially criminal behavior, it might sound like FIFA fits the definition of a corrupt organization. Counterintuitive as it may seem, though, the Justice Department hasn’t alleged that FIFA is a criminal enterprise. Rather, it has alleged that FIFA is the victim of a criminal enterprise—the group of corrupt officials who secured bribes and kickbacks through years of fraud and racketeering. Altogether these officials allegedly illegally solicited well over $150 million in exchange for exclusive media and marketing rights of international soccer tournaments. The Justice Department isn’t prosecuting them for that purported fraud alone. It is prosecuting them for allegedly participating in a criminal enterprise to defraud FIFA.

This charge is at the heart of the monster 161-page indictment released Wednesday. “The damage inflicted by the defendants and their co-conspirators,” the indictment declares, “was far-reaching”:

By conspiring to enrich themselves … the defendants deprived FIFA, the confederations, and their constituent organizations—and, therefore, the national member associations, national teams, youth leagues, and development programs that rely on financial support from their parent organizations—of the full value of [their] rights. …[S]uch deprivations inflicted significant reputational harm on the victimized institutions, damaging their prospects for attracting conscientious members and leaders and limiting their ability to operate effectively and carry out their core mission.
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The Justice Department’s main charge against FIFA’s officials isn’t very pretty. America is not attempting to topple a bloated, unprincipled organization. Rather, it is attempting to protect that horrible organization from its even more unscrupulous officials. These men owed a duty to FIFA to carry out their jobs honorably and conduct their business legally. Instead, they allegedly conspired to bribe their way to millions in personal wealth. The money they’re accused of pocketing should have gone to FIFA. Instead, prosecutors say, it went into their bank accounts.

And therein lies the second key to the Justice Department’s strategy. Many of the indicted officials are foreign nationals who have never lived in the United States. So how does the United States—and the Eastern District of New York in particular—have jurisdiction to prosecute them?

As it turns out, FIFA officials didn’t accept bribes in briefcases filled with cash: They allegedly had the money wired to them. And the banks that transferred the money keep their servers in—you guessed it—New York City. Thus, if an official had bribes wired to his bank account, his funds were routed through servers located in the Eastern District of New York—giving the U.S. jurisdiction to prosecute the crime. As FBI Director James Comey explained, “If you touch our shores with your corrupt enterprise, whether that’s through meetings or using our world-class financial system, you will be held accountable.”

Even if some officials had kept their money out of American banks, however, the U.S. could probably still assert jurisdiction to prosecute them. That’s because their alleged conspiracy operated, in large part, in the United States. Officials often held meetings in New York—meetings where they discussed, according to the indictment, “ongoing bribe schemes.” By furthering their allegedly criminal enterprise in New York, and associating with others who funneled money through New York banks, these officials ensnared themselves in a web whose center was the city itself. Some officials may not have, individually, committed an illegal act in New York. But under RICO, their purported participation in this conspiracy puts them on the hook for all of its wrongdoings.

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In a press conference Wednesday, Attorney General Loretta Lynch compared the FIFA case to investigations into the Mafia. It’s an apt (if slightly overblown) analogy: For years, prosecutors say, officials in FIFA’s upper rungs worked together to enrich themselves through fraud and deceit, using their immense power to extract kickbacks in return for favors only they were authorized to dispense. They thought they could hide behind layers of deception—but in the end, those layers only proved how deep the criminal enterprise runs. FIFA’s corrupt caste turned the organization into a morass of fraud and racketeering. The United States is trying to save FIFA from itself.

Thanks to Daniel Friel, former assistant U.S. attorney in the Eastern District of Louisiana, for help with this story.

*Correction, May 28, 2015: This story originally misspelled Stefan Fatsis’ first name and misquoted him.