How the media provides a cover for money laundering in football.

by Tony Attwood

It has for many years been rumoured that the transfer market is in the hands not of the clubs but of a small number of people who euphemistically are known as agents.  It is a topic we have covered before, noting reports that suggest that these agents not only present their players to clubs, suggesting that the player is available, they also become bankers making the finance available so that clubs feel they can afford players whom they previously thought were out of their reach.

In short moving players around with the agents supplying much of the finance is a form of money laundering based on the drugs trade.  It’s purpose is to give an explanation to the authorities for the source of their money.  They become rumour mongers (starting the transfer rumours we see every day), player agents and bankers.

The fact that these rumours are not based on anything solid can be shown both in the fact that in most transfer windows 98% of the rumours turn out to be untrue, and 99% have no traceable source.  Many rumour mongers cite other websites or newspapers as the source, which if one follows the trail ends up going round and round in circles.  Few ever cite an original source.

And there are many reports circulating suggesting that some agents are themselves linked closely to the illegal drugs trade.  Their interest in football is that it gives them an ideal way to launder the money that comes pouring into their empire in cash.

So, these agents help plant numerous wild stories in the media daily about player X going to club Y.  Journalists and bloggers lap up these tales never once asking “why do 98% of these stories turn out to be false?”  Never realising that by running these stories they are helping the drugs companies run their business.

Having a football club which often makes a loss, except when it does a particular deal, is ideal for this.  Indeed when Portsmouth went into crisis in 2010 just a couple of years after they won the FA Cup the issue of money laundering was reported to be at its core, with some suggesting that the principal reason for the investment of many previously unknown overseas groups was to allow them an outlet for money gained through criminal activity, most commonly drug dealing.

The governance of clubs by their leagues and has always notoriously slack, simply because increasingly it is the clubs that have had the money to do the deals, which generally involve a lot of overseas transactions.  Meanwhile organisations charged with overseeing the clubs and keeping them in order have been seen either as toothless organisations, often run by old duffers who have been put in charge because of their incompetence, or organisations which follow the Fifa route and show a wilingness to be corrupted.

Indeed many of the arguments against the activities of the FA in England have been of this nature: the association is unable to reform itself, and hence unable to reform the football it is meant to be controlling.

As a result of this lack of control, clubs that have been corrupted have been able to buy players with money gained from illegal sources and then sell the players later for clean money.  The books show the owners generously investing say £50m into the club and then later withdrawing from the club just £20m.  But in essence, they have been moving on money from sources they do not want to be identified, but taking out money that looks legitimate.

Uefa itself in a report suggested that money laundering was dominant in football and a huge number of transfers of players, especially transfers involving an eastern European club was primarily for the purpose of laundering money.

Although we have run a variety of pieces on the topic of the involvement of European gangs in football we have been generally sneered at, and (rather ludicrously I felt) asked to present evidence.  As if a football blog run by a group of fans was going to be able to provide the sort of evidence that the police were struggling to lay their hands on.

Rather the point has always been that the ceaseless loss-making of certain clubs only makes sense if money laundering is part of the plan.

Anyway none of the recommendations to crack down on racketeering in football by controlling unlicensed agents were ever implemented, and the third-party ownership of players has continued.  In this system a player’s transfer might be arranged by an agent who has agreed with the player to take a much higher proportion of the player’s income from all sources than is normal, in return for regularly moving him on for significant sign on fees.  Each move and each new arrangement makes it harder for the legal authorities in each country to track where the money actually came from to fund the movement of the player, and thus money that originated from drugs deals can no longer be easily traced back to the criminals.

A key part of the issue is that there is in effect no enforcement of the movement of players between clubs. If club A wants to sell and club B wants to buy they are hardly going to hold up the deal because they wonder how much of a cut the agent is getting.  One sees themselves getting a great player, the other sees themselves getting urgently needed money.  And besides if the journalists do their bit and say a player is worth £100m, but in fact the club actually only pays £15m, it helps the image of the club, and leads the financial authorities on a false trail.

Technically players can’t be owned by third parties, but with clubs always looking for new players with high potential available at bargain prices, if player agents are actively encouraging players to move (because the agents benefit from each move by getting a percentage of the deal), there is a constant drive for more and more transfers to happen.

This is enhanced by the insatiable desire of popular newspapers, broadcasters, and blogs, to create what appear to be complete articles and news stories out of the notion that player X is going to club Z.   To make each story appear credible the story always cites another source (usually overseas and untraceable if one tries to check back) as the origin of the piece.  One correspondent suggested that in South America the drug dealers have deals with newspapers to create rumours – which of course the journalists in England readily reprint on a daily basis.  As a result, and as we have shown 98% of all such rumours involving Arsenal are fake.  Now we can see why.

Thus as the Guardian said recently in the article “Football transfers rife with illegality and exploitation. It creates a climate of suspicion in which clubs are afraid to lose competitiveness by acting in legal and/or ethical ways. The lack of transparency in transfer operations in general, and in the representation market more particularly, puts clubs at disadvantage vis-à-vis agents and intermediaries who have easier access to the most relevant information.”

In short while the media makes the transfer market its key talking point and sees it as an indicator of whether the club is being ambitious, and the transfer of players as the only way to improve a club’s performance, the media frenzy surrounding transfer speculation actually exists as a way of covering up its true nature: a way of moving money from criminal activity into the legitimate business world.  Money laundering.

So what we now have are agents being paid by clubs to entice players to move, while Fifa, now utterly immobilized through the court cases that it is becoming increasingly embroiled in, primarily in Switzerland the USA, is unable to cope.  There is no even legislation prohibiting people with criminal records from becoming football agents.

Meanwhile, the football media daily stoke the flames reporting transfer stories mostly invented by agents either to promote their own player or as a smokescreen for their association with money laundering.

Thus we have

• Inept overseeing organisations (for example the FA)
• Overseeing organisations themselves with crooks and criminals running the show (Fifa)
• Agents associated with money laundering for drug dealers
• Newspapers and bloggers that willingly publicise fake transfer tales planted by the agents and thus keep the fake publicity for the system running
• Agents who increasingly own rights in the players whom they move around
• Clubs always looking for a cheap player without asking who is behind the move transfer they are offered.

It’s quite a system.

Chaos in Europe; silence in England

• Three years after the events, Infantino in yet another Fifa corruption case
• Another football scandal looms as law officers raid the German FA’s offices
• Infantino looks sunk; but if he takes down Fifa as well, what replaces it?
• Fifa starts to implode, and the strange case of lack of UK interest in events
• Amazing unbelievable development in the Fifa battle; sadly not on UK news
• The Fifa court cases continue, more corruption, more scandals and the FA says…
• How Fifa is finally falling apart in the courts (but the English don’t want to know)
• The Swiss government is fighting Fifa. And now so is the USA!
• Another legal case involving Fifa, yet more silence in the UK media