Banks did not police FIFA transactions

A global group of government anti-money-laundering agencies said that financial institutions have not done enough to police suspicious financial activity by officials at soccer's global governing body FIFA, and cautioned banks to step up scrutiny.

The warning from the Paris-based Financial Action Task Force came in the wake of last month's indictment by the United States of nine current and former FIFA officials and five business executives on a series of corruption charges, including bribery, money laundering and wire fraud.

With the US investigation continuing to widen, and a separate Swiss probe gearing up into whether there was corruption involved in FIFA’s awarding of the hosting rights to Russia and Qatar for the next soccer World Cups in 2018 and 2022, the warning will add to banks’ concern about handling certain soccer accounts for organisations and individuals.

Some European and US banks had already stepped up scrutiny of FIFA-related accounts and at least one said it had stopped handling FIFA business for some time because of corruption allegations. In a statement, that has now been removed from the agency’s website, FATF said “recent reports about alleged corruption and money laundering activities on a large scale by several high-ranking FIFA officials underscore how important it is that financial institutions identify and monitor high-risk customers.”

It said that financial institutions “do not appear to have given a sufficient amount of scrutiny to the financial activities of the officials concerned, as many of these allegedly corruption-related transfers passed through the international financial system undetected.”

FATF, whose members include the US, China, Brazil, Switzerland and many other European countries, said that an “ongoing public debate about the integrity of an entity should raise flags to financial institutions. As a result they should treat customers that are related to that entity as high risk customers.”

Reuters was told about the statement, which appears to be dated June 16, by a European official with knowledge of the FIFA case. It can be found through a Google search but is no longer accessible through the FATF website.

FATF President Roger Wilkins told Reuters that he had taken the decision to remove the statement from the agency's website over concerns about its phrasing and a lack of concrete evidence to support the claims.

“We don’t want to interfere with ongoing investigations and the way it’s phrased could be misconstrued,” he said, speaking by telephone from Brisbane where FATF is meeting. “We don’t have any direct evidence that financial institutions have done necessarily anything wrong or failed to do anything in relation to these things.”

Reuters