ISL fraud trial begins

Swiss prosecutors accuse Fifa's former marketing arm of large scale fraud.

    Uefa were highly critical of Sepp Blatter's
    handling of the ISL collapse [GALLO/GETTY]
     
    Swiss prosecutors have accused Fifa's former marketing arm of funneling millions of dollars in bribes through a Liechtenstein foundation.

    Prosecutors opened their court case by alleging that six executives of ISL/ISMM paid about $18 million to people involved in negotiating rights deals for major sporting events.

    It was the first time state prosecutors in the Swiss canton of Zug explicitly accused the company of bribery.

    They said ISL/ISMM used a foundation registered in the principality of Liechtenstein to funnel the money.

    The six executives, who have not been named because of Switzerland's strict privacy rules, deny all charges.

    No current or former Fifa officials are among the accused.

    The $300 million debt

    ISL/ISMM, Fifa's marketing partner for almost two decades, left an estimated debt of $300 million when it collapsed in 2001.

    The bankruptcy led to bitter clashes between football's world governing body Fifa and European body Uefa, which questioned Fifa president Sepp Blatter's handling of marketing deals.

    Prosecutors said the six executives knew about the payments. The six are charged with embezzlement, fraud, fraudulent bankruptcy, damaging creditors and falsification of documents, and could face up to 4½ years in prison if convicted.

    In total, the criminal mishandling at ISMM amounted to more than $98 million, prosecutors said.

    ISMM, the parent company of ISL, owned the television and marketing rights to the 2002 and 2006 World Cups.

    Shortly after the bankruptcy, Fifa lodged a criminal complaint against ISL/ISMM over irregularities in accounts.

    The Zurich-based sports body later withdrew the complaint, but launched a civil case to recover $122 million it claimed it was owed.

    ISL/ISMM was the focus of a tense power struggle at Fifa between Blatter and his former No. 2, Michel Zen-Ruffinen, and former Uefa president Lennart
    Johannson.

    Zen-Ruffinen accused Blatter of engaging in irregular payments in connection with marketing deals.

    Blatter denials

    Blatter denied any wrongdoing and was re-elected in 2002 for a second term as president of one of the world's most powerful sports bodies.

    Fifa spokesman Andreas Herren said the football body was only one of ISL/ISMM's clients.

    Others included Uefa, the International Association of Athletics Federations and the Association of Tennis Professionals.

    A verdict in the trial is expected later this year.

    SOURCE: Agencies


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