By Heather Lowe, June 1, 2015
The FIFA Bribery Case Could Lead to Compensation for the Victims of FIFA’s Alleged Corruption
You may have noticed that the U.S. Department of Justice (DOJ) is making sure that we have an idea of whom the victims in this FIFA corruption case are. They noted it in their press release, talked about it at their press conference, and included it in the indictment at paragraph 73. I agree with the Department of Justice that the victims of this case are important. This blog is about why this case could potentially lead to compensation for those victims in a way you might not have considered.
So who are those victims? The DOJ’s indictment describes how FIFA, the FIFA confederations, the confederation members (including national member associations), youth leagues, and development programs all lost out on funds from the marketing contracts that may have been more lucrative for FIFA if there had been competitive bidding for the contracts. In addition, other sports marketing companies that may have lost out on a bid to secure the marketing rights—or may never even had a chance to bid—are also victims.
For those of us that work on development issues, this is a particularly important point. Commercial bribery distorts markets. Among other things, it can:
- prevent honest firms from winning bids and therefore stymie their growth,
- block new companies from entering a market, and
- weaken that market in general because the best service, price, processes, etc., are no longer going to rise to the top, keeping market standards low and depriving consumers of better quality services and products.
When a country or industry is plagued by endemic bribery, these negative economic effects increase exponentially and a country’s economy cannot grow. That’s why the DOJ doesn’t want large-scale bribery taking root in the U.S., and rightly so.