Football: 'Ominous' signs in Fifa's leaders' pay deals

(From left)  Jerome Valcke, Sepp Blatter and Markus Kattner
(From left) Jerome Valcke, Sepp Blatter and Markus KattnerPHOTO: REUTERS, EPA

ZURICH (AFP) - Sitting on the top of a mountain of football cash, Sepp Blatter, Jerome Valcke and Markus Kattner unilaterally awarded themselves bonuses and contracts worth millions of dollars.

Details of a Fifa investigation revealed on Friday (June 3) said the trio, who formed the pinnacle of the Fifa power pyramid, plotted "to enrich themselves" and ensure a comfortable future in case the they lost their jobs. They gave themselves US$80 million (S$109 million) in the past five years alone.

Over the last year, however, former president Blatter, Valcke, his number two as secretary general, and finance director Kattner have been fired or booted out of office and now face growing scrutiny from Swiss and US prosecutors.

 

"The evidence appears to reveal a coordinated effort by three former top officials of Fifa to enrich themselves through annual salary increases, World Cup bonuses and other incentives totalling more than 79 million Swiss francs (S$110 million) - in just the last five years," said Bill Burck, a partner with the Quinn Emanuel audit firm.

Fifa, now led by Giani Infantino, even created a compensation subcommittee in 2013 but they failed to rein in the illicit awarding of "massive" and "undue" payouts.

"There are multiple amendments to contracts often approved in close sequence," said a Fifa account of the investigation so far.

"Additionally, these various contracts were often entered into by Messers Blatter, Valcke and Kattner on the very same day. And more importantly, these dates were very ominous."

On April 30, 2011, just before a Fifa presidential election, when it was not certain Blatter would get a new four year term, Valcke and Kattner were given 8.5-year contract extensions until 2019 "with big increases in their base salaries and bonuses".

They also got "generous severance terms that guaranteed them full payment - up to 17.5 million Swiss francs and 9.8 million Swiss francs respectively - in case their employment with Fifa" was terminated, the likely consequence should Blatter not have been reelected.

If their jobs were terminated the two would receive the full value of their contracts "even if they were terminated for just cause".

Fifa would also pay their legal fees and other costs - two clauses the report described as appearing "to violate mandatory Swiss law".

Valcke was eventually dismissed last year over allegations of involvement in the black market sale of 2014 World Cup tickets. He also signed off on a US$10 million transfer made by South Africa to disgraced Caribbean football baron Jack Warner that US investigators suspect was a bribe to get support for South Africa to host the 2010 World Cup.

Kattner was sacked on May 23 after Fifa started looking into millions of dollars of payments that the finance director, and acting general secretary after Valcke's departure, awarded himself.

As finance director he had the authority to tell his subordinates in the payroll and HR department "how much should be paid out and to whom".

Fifa earns more than US$5 billion in revenues in the four years between each World Cup. The leading trio had their share, according to their contracts.

On Dec 1, 2010, Blatter, Valcke and Kattner received 23 million Swiss francs in "special bonuses" after the 2010 World Cup in South Africa.

The payments were awarded "retroactively" and "apparently without an underlying contract provision stipulating such bonuses".

In Oct 2011, Valcke and Kattner were awarded a combined 14 million Swiss francs in bonuses for the 2014 World Cup and in June 2014, they were made eligible for a combined 15.5 million Swiss francs in bonuses for the 2018 World Cup in Russia.

Swiss authorities searched Kattner's former Fifa office on Thursday. Fifa said they will also inform US authorities, who have already charged about 40 individuals and two companies over football corruption and are continuing to investigate.