Thursday, May 28, 2015

Tales Of Corruption: May 2015 Edition

Two separate corruption cases in the news, one common theme.

First, the ongoing scandal that is FIFA:

FIFA, the notoriously corrupt and yet seemingly invincible governing body of world soccer, has finally landed itself an indictment that some would say is worthy of its reputation. The charges against a handful of senior FIFA officials include money laundering, racketeering, bribery and fraud. In short, the federal lawsuit alleges what millions of soccer fans have suspected all along: that FIFA officials have been using the organization's massive influence to line their pocketbooks.

It's not enough to note how long this has been a problem: for decades, FIFA has been raking in millions and then billions of questionable money using the bidding wars between nations to host World Cup games, making decisions less on quality and availability and more on how much the host nation is willing to sell out.  The recent turmoil in Brazil - where FIFA profited at the expense of the impoverished nation - is the latest set of newsworthy reports to follow.  The fate of all those quickly, poorly built stadiums highlights the waste FIFA insisted on (and still does) when creating locations for their games.

FIFA had gotten to where they could dictate to host nations laws to make their organization more powerful and profitable.  They refused any transparency in their internal affairs.  Any dissent inside and outside stifled as the men in power remained in power (until their individual bad habits got to be too much even for FIFA to hide under the rug).

And for decades no-one fought it, no-one questioned it.  Because of national pride: soccer (international football) crazy nations could not say No, could not question the demands, out of fear of retribution or embarrassment.  Nations still pandered for the opportunity to be host country every four years.  Teams pined for the opportunity to win on the field.  Fans still traveled to rickety stadiums in poor urban (and in Brazil's case rural) zones and spent money to FIFA's delight.

Is it any surprise an organization would turn corrupt so fast, so deep?

The news punditry seems to be caught between awe and surprise that any charges at the level of FIFA's top offices were ever brought.  But we shouldn't be: sooner or later this much corruption collapses on itself.  The sin of pride by other nations got swamped by the pride and arrogance of the men who stayed in power too long.  Sepp Blatter has been in charge of FIFA since 1998, pretty much a turning point in how corrupt that organization became, and remains the most obvious problem in that organization that hadn't been arrested (yet).  Let this Slate article document the atrocities (of which I'll list a few):

...listing the seemingly unending litany of corruption allegations against the organization Blatter has run since 1998 and has been an official at since 1975.  ...with this just-ended World Cup and the police allegations of an illegal ticket sales scheme by FIFA’s ticketing and hospitality partner, a company in which Blatter’s nephew has a minority stake. Blatter presided over the decision to hand the £342 million contract to his nephew’s company back in 2007, and it wasn’t the first time he was alleged to have funneled cash to that particular family member...
...In 2002, Blatter was accused by FIFA’s then secretary general and erstwhile ally Michel Zen-Ruffinen of losing the organization $500 million through financial mismanagement, corruption, and cronyism. Zen-Ruffinen also testified that Blatter had paid a FIFA referee named Lucien Bouchardeau $25,000 and promised him $25,000 more for information on a Somali soccer official, Farah Addo, who had accused Blatter of bribery in his first election bid...
...FIFA’s corruption has direct consequences in the real world. In South Africa, hundreds of millions of dollars were spent on white elephant stadiums that have rarely been used following the 2010 World Cup in a country where more than half of its children were living in poverty as of 2012. Multiple local officials in that country were reported to have been murdered, allegedly for whistle-blowing or other involvement in stadium fraud.
In Brazil, a $300 million, 40,000-plus seat stadium was built in the middle of the Amazon rainforest where potential post-Cup audiences of that size just don’t exist. That’s probably one reason why a majority of Brazilians opposed hosting this World Cup, saying the more than $11 billion price tag could be better spent on public services...

And we haven't even gotten to the part where everything tipped against FIFA, when the stench of greed became too noxious to bear: the awarding of the World Cups for 2018 and 2022 to Russia and Qatar.  While Russia is a prominent nation with enough major cities to effectively host games, it's also one of the better-documented kleptocracies on the planet with a list of human rights abuses and current border issues with Ukraine.

And Qatar has been a disaster since Day One.  There were open questions about having a nation right on the equator hosting summer games in high heat environments, with each new question poorly answered than the last.  The games have to be moved to winter months, conflicting with other nations' scheduled football seasons.  Qatar simply does not have the infrastructure - the major cities of hotels, restaurants, transit service, communication hubs - needed to host so many games at once, and some places designated as locales don't even exist on the maps.

And in order to build these non-existent places to house insanely expensive stadiums, Qatar has resorted to a criminally bloody system of exported workers working overtime and in hostile conditions to the point of exhaustion and DEATH.  From Vox's report:

Working conditions are, in many cases, horrendous. Multiple reports from Amnesty, Human Rights Watch, the International Trade Union Confederation, and even a contractor employed by the Qatari government have come to basically the same conclusion: migrant workers frequently don't get paid for months at a time, are prevented from leaving the company or the country, and are forced to work in impossibly hot weather and conditions that virtually guarantee some will die.
In one migrant worker labor camp Amnesty researchers visited, "sewage was leaking from the ground — apparently from the camp's septic tank — and flowing down into the street, where it had collected in a large stagnant pool. Piles of rubbish were mounting up at the camp, apparently because the company had not paid for them to be collected, and the piles of rubbish attracted swarms of insects."
There was no electricity or running water. When Amnesty informed the Qatari authorities of this, they provided a small generator — and then took it away three days later.

And the death toll is already beyond the measure of other comparable mass projects:

From the Washington Post
Construction work should not be a death sentence.  And yet FIFA - which is supposed to oversee these projects and ensure the host nations are obeying laws and worker safety - has done nothing about it.  If the organization is feeling like it has few friends at the moment, it's because this corruption has a body count other nations can no longer ignore.  It's gotten to where even FIFA's headquarters home Switzerland is investigating charges of bribery involving the Russia and Qatar bids.

That's the current status of one scandal.  The second scandal just erupted today, although it has its roots back more than a decade by now.  Former Speaker of the U.S. House Dennis Hastert - the Least Powerful Republican With an Actual Title of the last twenty years - has been charged with lying to investigators and hiding evidence regarding a complex extortion/blackmail scheme.  To David Graham's Atlantic article:

But reading between the lines of the indictment against Hastert suggests a darker story than political corruption. In or about 2010, according to the indictment, Hastert—a former high-school teacher and coach—met with an unnamed individual from Yorkville, Hastert’s hometown. They “discussed past misconduct by defendant against Individual A that had occurred years earlier.” In effect, Hastert fell victim to blackmail, the indictment alleges: He “agreed to provide Individual A $3.5 million in order to compensate for and conceal his prior misconduct against Individual A.” (Since leaving the House, Hastert has become a highly paid lobbyist.)

Guessing games about who Individual A is should dot the blogosphere / twitterverse for the next two days.  And who's got $3.5 million to throw around like that to pay off a blackmail demand?!  Oh, right.  Insider Lobbyists.

Hastert then allegedly began withdrawing cash from his bank accounts to pay to the individual. But federal laws require financial institutions to report transactions greater than $10,000, and Hastert made a series of them. In April 2012, the indictment alleges, employees of Hastert’s bank questioned him about the withdrawals, and he promptly reduced his withdrawals to smaller amounts, to escape the requirement. Authorities were already watching, however, and they began investigating Hastert for structuring currency transactions to evade federal requirements—itself a crime.

"Can't get away with nothing" is probably what Hastert was thinking when he tried to hide transactions that were illegal to hide in the first place.  So why was Hastert acting like that in the first place?  Committing acts of desperation that were bound to draw attention and investigation?

Because he thought he could get away with it.  He was an ex-Speaker with political and financial connections up the wazoo.  He thought he could lie to investigators and have his own identity protect him from further inquiry.  Because power got to his head long ago, and with that power came pride and arrogance and recklessness.  It may not be on the scale of evil and corruption that FIFA leader Sepp Blatter is still committing at this moment, but it still reeks of damage and hypocrisy.

Let justice be done.  It would be nice to think Sepp Blatter will lose Friday's election for the Presidency - his incumbency has gone longer than FDR's - in the wake of the arrests and public outcry over Qatar, but that organization's system is so rigged in his favor I doubt it.  If he wins, he still faces the possibility the EUFA - the European leagues and the most prestigious part of the world football organization - will threaten to leave, destroying FIFA's very existence (A World Cup without Germany or Italy is no World Cup).  More likely is that the recently arrested are in position to turn testimony in exchange for saving their skins, any one of them close enough to Blatter to hopefully reveal a key link to justify slapping handcuffs on the corrupt SOB.

As for Hastert, it's got to come out just what the hell he was paying Individual A to keep secret.  Whoever it is has got to be on the run or planning his own deal to avoid charges of blackmail.  Either way, Hastert is toast: it's merely a question if the sin he's hiding is his own... or someone else's.

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