Nike Tied to FIFA Corruption Scandal Engulfing Miami-Based Company
Nike has issued a statement promising to cooperate with the probe.
The corruption scandal tearing through international soccer this week has already taken down more than a dozen top-ranking FIFA execs and business partners facing federal charges — including Aaron Davidson, the Miami-based head of soccer marketing giant Traffic Sports USA.
But now the corruption probe looks likely to entangle an even bigger corporate player: Nike, the sportswear giant, which has been tied to a bribe scheme that brought down Davidson's corporate boss in Brazil.
Nike has issued a statement promising to cooperate with the ongoing probe, noting, “Nike believes in ethical and fair play in both business and sport and strongly opposes any form of manipulation or bribery. We have been cooperating, and will continue to cooperate, with the authorities.”
Here's how the dots have connected back to the Oregon-based footwear giant. Federal authorities swooped into a hotel in Zurich this past Monday, nabbing nine FIFA execs staying there on wire fraud and racketeering charges back in the U.S. In all, 14 FIFA-linked officials face similar charges, which revolve around bribes paid and received to dole out lucrative TV and marketing contracts for the beautiful game.
Davidson is among those charged. Prosecutors say he helped steer millions in bribes to CONCACAF, the FIFA regional body for North America, Central America, and the Caribbean, to get TV and marketing rights for Brickell-based Traffic Sports USA.
That company's corporate parent, Traffic Sports International, is based in Brazil. And its founder, Jose Hawilla, already secretly pleaded guilty to corruption charges in December, agreeing to forfeit $150 million linked to the scheme.
That's where Nike comes into play. Hawilla's indictment has yet to be unsealed in federal court (a hearing is scheduled this morning to consider whether to release his complaint to the public).
But when U.S. Attorney General Loretta Lynch described the charges against the Brazilian, she said they included bribes paid on "agreements regarding sponsorship of the Brazilian national soccer team by a major U.S. sportswear company."
Hawilla has reportedly pleaded guilty in connection to the same deal: a 1996, $160 million package from Nike to sponsor Brazil's famed national soccer team.
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Nike reportedly isn't named in any federal charging documents, but it's link to Hawilla and the bribery scheme seems clear. More details could emerge today if a judge unseals the full indictment against the Brazilian.
The biggest name in FIFA, meanwhile, announced late last night he'll go on with plans to hold an election today despite the stunning corruption probe engulfing his sport. FIFA President Sepp Blatter finally addressed the charges yesterday after an emergency meeting in Switzerland and said he wasn't responsible for the corruption in the organization.
"We, I, cannot monitor everyone all the time. If people want to do wrong, they will also try to hide it," he told reporters.
He'll face Jordanian Prince Ali Bin Hussein in today's election, which most experts expect him to win despite the corruption case.
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