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Submission 28
26 August 2015
Dr Kathleen Dermody
Committee Secretary
Senate Economics Reference Committee
PO Box 6100
Parliament House
CANBERRA ACT 2600
Dear Dr Dermody
I refer to the Inquiry into Foreign Bribery by the Senate Economic References
Committee.
I am pleased to provide this submission in respect of the Committees terms of
reference, particularly in relation to parts b(ix) and b(xii).
Please note that I would be pleased to appear before the Committee if
required, at my expense. However, I live in Europe and would ask that I be
given a minimum period of one months notice if possible so that I may arrange
my business and related commitments accordingly.
Please do not hesitate to contact me on
further information.
if you require
Jaimie Fuller
Chairman
SKINS Group of companies
Foreign bribery
Submission 28
Submission to Inquiry into Foreign Bribery by Jaimie Fuller, Chairman of SKINS, August 2015
1.
Introduction
Thank you for the opportunity to make this submission to the Inquiry into Foreign
Bribery (Inquiry) by the Senate Economic References Committee, particularly in
relation to parts b(ix) and b(xii) and Australias bid for the 2018/2022 World Cup
tournaments.
2.
About SKINS
3.
Why football?
I became interested in football and its governance firstly as a general issue. Like
many in the world, I found the decisions by FIFA to hold the World Cup tournaments
in Russia in 2018 and Qatar in 2022 as incredible not simply because I thought other
countries could do either tournament better (eg. England, Spain/Portugal for 2018 or
any of the other competing bids for 2022), but because of the significant human
rights issues facing both of the winning countries and the ease with which they won
their respective ballots. Russia won in just two ballots; Qatar won in four ballots.
I was also aware that Australia did very poorly in its bid gathering just one vote,
being knocked out in the first ballot and spending upwards of AUD $45 million of
public money in its bid.
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Submission 28
Submission to Inquiry into Foreign Bribery by Jaimie Fuller, Chairman of SKINS, August 2015
I had read bits and pieces about Australias bid before and after the vote, such as:
this article written by Matthew Hall that revealed the inclusion of a consultant
by the name of Peter Hargitay in the Australian Bid team
http://www.smh.com.au/news/sport/football/meet-ffas-man-ofmystery/2009/10/17/1255624771126.html;
this article written by Davidde Corran which raised questions about the
conduct of the Bid when the same Peter Hargitay had so much influence on
it http://www.theroar.com.au/2009/10/21/what-cost-are-we-willing-to-payfor-a-world-cup/;
an article written by British journalist, Andrew Jennings, concerning Mr Fedor
Radmann being another consultant engaged by the Australian Bid team in
January 2010 (copy attached);
the series of reports published by Fairfax in June/July 2010 that focused on
two of the consultants engaged by the Australian Bid, Peter Hargitay and
Fedor Radmann. Here is one of them
http://www.theage.com.au/national/world-cup-money-trail-lobbyists-tomake-millions-20100629-zj89.html;
an ABC Four Corners program on Australias failed Bid with former FFA
executive Bonita Mersiades, Peter Hargitay and SBS Televisions Les Murray
http://www.abc.net.au/4corners/stories/2011/09/08/3313323.htm.
4.
#NewFIFANow
Fast forward twelve months to November 2014, and I was contacted by British MP,
Damian Collins, who was coordinating a meeting of interested parties in the
European Parliament in Brussels in January 2015 to discuss FIFA and avenues for
improving its governance.
Mr Collins was moved to convene this meeting after the publication of the Eckert
Report, a 42-page summary of the 21-month investigation into the 2018 and 2022
World Cup Bids by the former Ethics Committee Investigations chief, Michael J
Garcia. Amongst other things, the summary report pointed to problematic
conduct by the Australian Bid, but also all-but publicly outed an Australian
whistleblower, Ms Bonita Mersiades, referring to her as unreliable because she had
spoken with the media. Judge Eckert also outed the woman who was the Qatari
whistleblower referring to her as not credible. Mr Garcia spoke with 75 witnesses
but FIFA via Judge Eckert only referred to two.
The Brussels meeting was co-convened by European MPs Emma McClarkin of
Foreign bribery
Submission 28
Submission to Inquiry into Foreign Bribery by Jaimie Fuller, Chairman of SKINS, August 2015
England and Ivo Belet of Belgium. Guest speakers included myself, former FIFA
executives including the head of the team that inspected all 2018/2022 bidding
nations, Harold Mayne-Nicholls of Chile, former head of the English FA Lord David
Triesman and Bonita Mersiades. The Communique arising from the meeting is here:
http://www.newfifanow.org/january-21-2015.html. Mr Collins wrote to several
Australian MPs and Senators inviting them to the Brussels meeting and seeking their
support for our efforts.
From that meeting, we established a campaign group known as #NewFIFANow. It
involves politicians, current and former football officials, government officials,
football whistleblowers and others who are collaborating to effect genuine, longlasting systemic change at FIFA. Our aim is for the establishment of a time-limited
independent FIFA Reform Commission led by an eminent person to review, develop
and implement changes to FIFAs Statues, policies and electoral process and then
conduct fresh elections. A copy of the #NewFIFANow Charter and Guiding
Principles for FIFA Reform is attached.
Since January 2015, we have been active in lobbying FIFAs sponsors, the 209
football associations, the FIFA Executive Committee, international organisations such
as the UN and UNESCO and player representative groups and fans groups to
support our principle objective.
Along the way, we have formed a coalition with the International Trade Union
Confederation (ITUC), originally around the issues of human rights and workers rights
abuses under the kafala system in Qatar but now more broadly encompassing
governance issues, Transparency International and Avaaz. All of these groups have
endorsed the call for a time-limited independent FIFA Reform Commission, as has
the European Parliament in its joint resolution here:
http://www.europarl.europa.eu/sides/getDoc.do?pubRef=-//EP//TEXT+MOTION+P8RC-2015-0548+0+DOC+XML+V0//EN.
Three of FIFAs major sponsors have also supported our call: that is, Coca-Cola, VISA
and McDonalds. We continue to lobby the remaining sponsors of adidas,
Budweiser, Gazprom, Hyundai and Kia.
Since the formation of #NewFIFANow, I have taken a prominent role as one of the
three key spokespersons for the group in international media and in other
international forums. Because of this, and a little like an investigative journalist
perhaps, I have also had people share information with me unsolicited and/or
corroborate information about FIFA and FFA.
I have also observed closely and commented publicly on some of the information
that has come to light especially since the arrests of the football officials in Zurich on
May 27, 2015, by the FBI. It should be noted also that, in addition to the US inquiry,
the Swiss Government is conducting a separate inquiry around the 2018 and 2022
World Cup bids (not just the winners) in relation to potential money laundering and
wire fraud.
Foreign bribery
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Submission to Inquiry into Foreign Bribery by Jaimie Fuller, Chairman of SKINS, August 2015
5.
Based on the discussions Ive had, and articles and interviews Ive read or seen,
there are some important questions around governance and management of
Australias World Cup Bid and the use of taxpayers funds relevant to this Inquiry. I list
these questions for the benefit of the Committees consideration.
5.1
Consultants
In FFAs Final Report to the government on expenditure on the Bid (September 2011),
they state that Mr Radmann received $3.63 million.
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Submission to Inquiry into Foreign Bribery by Jaimie Fuller, Chairman of SKINS, August 2015
In FFAs Final Report they state that Mr Hargitays company, ECN, received $1.45
million.
In the reports written by Baker & McKenzie in Fairfax media in June/July 2010, it was
stated that two of the consultants, Mr Hargitay and Mr Radmann, would receive a
bonus of $6.5 million between them if Australia won the 2018 tournament. As far as I
am aware, this was not disputed by FFA.
5.2
Considering Australia won neither tournament (and had pulled out of 2018 in
June 2010), why did FFA return only $3.34 million to the Government on
completion of the Bid?
Was the Government satisfied that only $3.34 million was returned in light of
the $6.5 million bonus that had been budgeted for?
What was the remaining $3.19 million spent on?
Relationship with the Russian Bid
Reports from Zurich in December 2010 say that on the night the outcome of the vote
was to be announced, Mr Frank Lowy and Mr Hargitay were waiting outside the
Zurich Congress Hall in snow conditions waiting for the arrival of the Russian Bid
contingent.
Foreign bribery
Submission 28
Submission to Inquiry into Foreign Bribery by Jaimie Fuller, Chairman of SKINS, August 2015
Bid Book
What was the original contracted amount with Mr Abold and his company
for this work?
Considering Mr Abold and his company had a track record in developing
successful Bid books and associated activities for the bids (eg. Germany 2006,
South Africa 2010, Abu Dhabi 2010 and 2011 and many others), why did this
cost blow-out by 38% (or $3.02 million)?
Was FFA concerned about this cost overrun? At what stage did it become
apparent that there would be a cost overrun of this magnitude?
What steps were taken to contain the costs within the original budget?
At any stage, did FFA consider that even at $8 million this was an excessive
amount of money for a Bid Book? What was the justification for this cost
overrun?
Is it a coincidence that the blow-out in the Bid Book costs ($3.02 million) is
roughly equivalent to the amount of the unreturned, previously budgeted
bonus ($3.19 million)?
Was FFA satisfied with Mr Abolds performance under the contract?
5.4
Payment to the Confederation of North and Central America and Caribbean
Football (CONCACAF)
It is widely reported and acknowledged by Mr Frank Lowy that a payment of
US$462,000 (approximately AUD$640,000) was made for the upgrade of stadium
facilities at the Joao Havelange Centre of Excellence in Trinidad and Tobago in
September 2010, a little over two months prior to the vote. It was a matter of public
record that this facility was owned personally by the then President of CONCACAF
and FIFA Executive Committee member, Jack Warner, who was named in the
indictment of May 2015 by US authorities.
One of Australias rivals for the 2022 vote, the USA, is a member of CONCACAF.
Why did FFA think it necessary to contribute funds for this purpose?
Where did the money come from?
If the money came from FFA funds (non-Bid), where is it included in its annual
financial report for 2010-11? Did FFA inform its members of this expenditure
either before or after the donation?
Why was there no media release to announce this generous donation?
Mr Frank Lowy has stated publicly that he had no discussion with Mr Warner
about this donation. Is he aware whether any of his consultants did? If so,
what did he know about these discussions and when?
Foreign bribery
Submission 28
Submission to Inquiry into Foreign Bribery by Jaimie Fuller, Chairman of SKINS, August 2015
5.5
Mr Frank Lowy has stated publicly that several people visited Trinidad and
Tobago to inspect this facility, and that detailed plans were made for the
work. How many people inspected the facility and at whose expense? How
much did these visits cost? What bucket of money paid for the plans to which
Mr Lowy referred and how much was this?
Mr Frank Lowy has stated publicly that AusAID did not support additional
government funds going to this facility upgrade in Trinidad and Tobago. Was
this a concern to him or anyone at FFA? Why did he think it was necessary,
considering it was not approved by government experts, to make the
payment ten weeks out from the vote?
Due to the nature of the sport, FFA would make a large number of
international payments, presumably by ordinary banking arrangements. Why
was this particular payment made by way of a Travelex cheque, via London
and New York, rather than by ordinary banking arrangements? Did FFA make
any other payments in relation to the Bid in this manner? If so, what and to
whom?
Memorandum of Understanding with Jamaica
5.6
In November 2010, one week or so before the World Cup vote, Australia was given a
Dream Asia award by the Asian Football Confederation (AFC) in appreciation for a
AUD $5 million donation to the AFC.
Why did the FFA think it necessary to contribute funds for this purpose?
How much of the $1.46 million allocated to projects related to the AFC in the
Final Report to government were included as part of the $5 million donation?
Was the $1.46 million paid by Travelex cheque or by ordinary banking
arrangements?
In the Final Report to government of September 2011, FFA notes that its
Community Programs expenditure was underspent by 28% ($950,000)
primarily because of a reduction in FFAs obligations to football
development in Asia.
Where did the funds for the $5 million donation come from?
If not from Bid monies, was it from FFA (non-Bid) monies? If so, where is it
included in any of its annual financial reports? Did FFA inform its members of
this expenditure either before or after the donation?
Foreign bribery
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Submission to Inquiry into Foreign Bribery by Jaimie Fuller, Chairman of SKINS, August 2015
5.7
It is widely reported that Australia provided AUD$4 million over three years from the
AusAID budget to the Oceania Football Confederation for sports development
projects via the Australian Sports Commission. Unlike the donations to CONCACAF
and the AFC, this donation was announced publicly by then Prime Minister Kevin
Rudd at a Commonwealth Heads of Government meeting in August 2009.
5.8
Why did AusAID and the Australian Sports Commission think it necessary to
contribute funds for this purpose?
Whose suggestion was it that these funds be made available?
Did AusAID need to obtain any additional funding in that financial year or
subsequent years in order to meet this obligation?
How much money had AusAID previously provided to the Australian Sports
Commission for sport development in the Pacific?
When Prime Minister Rudd announced the grant, the agreement was cosigned by the then Chief Executive of FFA, Mr Ben Buckley, and the then
President of Oceania and FIFA Executive Committee member, Mr Reynald
Temarii. As it was for general sports development purposes, why were Mr
Buckley and Mr Temarii signatories to this agreement?
What did FFA, AusAID and the Australian Sports Commission think when Mr
Reyanld Temarii was one of two FIFA Executive Committee members caught
on tape by The Sunday Times offering to sell his vote in return for funds of $4-5
million for a headquarters building?
What did FFA, AusAID and the Australian Sports Commission think when
Ahongalu Fusimalohi of Tonga Football Association, and executive member
of the Oceania Football Confederation, was caught on tape by The Sunday
Times admitting that Oceania was voting for Australia in the Bid vote because
of the donation made by Australia to Oceania?
Non-payments to Africa
The four voters from the African continent were Mr Amos Adamu (Nigeria), Mr
Jacques Anouma (Cote dIvoire), Mr Issa Hayatou (Cameroon) and Mr Hany Abo
Rida (Egypt). In the reports written by Baker & McKenzie in Fairfax media in
June/July 2010, it was stated that an amount of AUD$4 million was budgeted for
international football development in Africa. As far as Im aware, this claim was not
disputed by FFA.
However, in the Final Report to government, FFA refers to $240,000 paid towards
projects in Africa: $150,000 for Tygerberg Childrens Hospital and $90,000 for lap
desks, both in South Africa.
Foreign bribery
Submission 28
Submission to Inquiry into Foreign Bribery by Jaimie Fuller, Chairman of SKINS, August 2015
5.9
Bid management
5.10
Mr Frank Lowy
Mr Brian Schwarz, Deputy Chairman of FFA (and also Deputy Chairman of
Westfield)
Mr Philip Wolanski
Mr Peter Hargitay
Mr Stevie Hargitay
Mr Fedor Radmann
Mr Andreas Abold
Mr Ben Buckley (as CEO).
Considering they were responsible for a significant government grant, were
any records of the Bid management meetings made? If so, do they make
reference to any of the issues raised above?
Were any recommendations made by FFA employees that a broader-based
advisory or management group should be established for management of
the Bid?
How much information was shared with the remainder of the FFA Board?
Why was the FFA Board told via a Memo from Mr Buckley to the Board in
October 2009 that the amount budgeted for the Bid Book was $5.39 million
when, in FFAs Final Report, they state that the original budget was $8 million
and final expenditure $11.02 million?
Treatment of whistleblowers
Through my activism work, I have had the privilege of meeting many people who
can be considered whistleblowers.
Relevant to this Inquiry is the Australian who was disgracefully singled out by the
Eckert Report referred to above on behalf of FIFA and referred to as unreliable, Ms
Bonita Mersiades.
Having known Ms Mersiades for almost two years, and worked with her as a cofounder of #NewFIFANow, she is anything but unreliable. She has shown herself to
be a person of utmost professionalism and integrity, with a high work ethic
complemented by a lifelong love, and knowledge, of football. Like me, she is
motivated in respect of her significant work in relation to #NewFIFANow by a
genuine desire to see world football (and its 209 member associations) managed
with an appropriate level of democracy, transparency and accountability.
When her employment with FFA was terminated, she was denigrated personally in
the press by
who, at the time had not even met
her; and blamed for lack of activity in relation to the Bid in respect of relationships
with state governments and stadiums, when neither were her responsibility, by
. How would these two otherwise reputable journalists have got
this so wrong if they were not briefed by FFA as a type of payback for daring to
question some of the decisions taken by FFA, particularly in relation to the
consultants?
Foreign bribery
Submission 28
Submission to Inquiry into Foreign Bribery by Jaimie Fuller, Chairman of SKINS, August 2015
The social media chitchat, prompted by a tweet from an FFA employee, was that
Ms Mersiades was the source of the information to
in June/July 2010
because she was bitter and twisted and a disgruntled former employee. I do not
know if she was, or she wasnt, one of the sources for
, but I do know that
media reports have proven to be correct. I also know that Ms Mersiades is
neither bitter nor twisted and that the phrase disgruntled former employee is
usually a lazy excuse that is used by former employers to try to dismiss claims against
them.
Since becoming more prominent internationally as a #NewFIFANow advocate, Ms
Mersiades has been further targeted by FIFA and parties close to FIFA. This action
has included the establishment of a fake website using her name, a fake email
address using her name and a fake Bitcoin account using her name and soliciting
funds for publication of a book.
My experience with whistleblowers suggest that this is typical behaviour of powerful
people and organisations that are in the wrong. They operate on the basis of a
culture of silence and intimidation where people who dont speak-up are rewarded
and those who do can suffer. I am aware that Ms Mersiades was not able to find
alternative appropriate employment despite her immense skills, capabilities and
experience.
As I mentioned at the outset, I have read, listened to and watched a large amount
of material in relation to Australias World Cup Bid. Ms Mersiades has always been
measured and professional in her commentary. She has never made accusations
against the FFA or any of her colleagues. She has raised legitimate questions about
the conduct of the Bid that deserve an answer. Comments she has made directly
about Australias Bid consultants and in relation to issues such as Australias
donation to CONCACAF have proven to be accurate. In respect of FIFA, and
broader football governance issues, her experience, insights, commentary and
judgement are nothing short of impeccable.
Relevant also are the cases of two Australian journalists.
One is Jesse Fink, who was formerly employed by the website associated with SBSTV, TheWorldGame.com.au. Mr Finks experience as a critic of the Australian Bid has
been documented via the ABCs 7.30 program
http://www.abc.net.au/7.30/content/2011/s3264012.htm. The other is Davidde
Corran, who is also interviewed in the 7.30 story and to whose article I referred in
section 3 of my submission. These young journalists were doing nothing other than
casting a questioning eye over the World Cup Bid, and issues and individuals
associated with it, and also lost their jobs.
I do not know what the answer is in respect of whistleblowers. But I do know, from my
experience with Ms Mersiades, my understanding of the circumstances in relation to
Mr Fink and Mr Corran, and my experience with whistleblowers in cycling, athletics
and cricket, that as a community, we should do all that we can to protect them
and to support courageous individuals who are only seeking to find the truth in the
public interest and to advance civil society.
ENDS
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