The DA MP’s 2010 World Cup Scandal Affidavit
Complaint Concerning The Crimes Of Corruption Under Section 3 The Prevention Of Corrupt Activies Act, 2004 And Fraud.
1, the undersigned MMOBA SOLOMON MALATSI do hereby make oath and state that,
1. I am the complainant in this matter.
2. I am an adult male member of the National Assembly of the Republic of South Africa of full legal capacity, presently residing at 12 Union Street, 9 Avignon Court, Gardens, Cape Town.
3. Unless otherwise indicated, the facts contained in this affidavit are within my personal knowledge and to the best of my belief, are both true and correct.
4. This complaint concerns criminal offences committed in contravention of the Prevention and Combating of Corrupt Activities Act, 2004 (“the Corruption Act”) by, among others:
4.1 Daniel Alexander Jordaan (“Jordaan”), an adult male, the current mayor of the Nelson Mandela Metropolitan Municipality, as well as the current President of the South African Football Association, whose further particulars are unknown to me; and
4.2 Molefi Nataneal Oliphant (“Oliphant”), an adult male, and the erstwhile President of the South African Football Association, whose further particulars are unknown to me.
5. On 15 May 2004, it was announced that South Africa would host the Federation of International Football Associations’ (“FIFA”) 2010 World Cup (“the 2010 World Cup”). The award of 2010 World Cup to South Africa was the culmination of a bidding process, during which South Africa’s bid was driven by the South African World Cup Bid Committee 2010 (“the 2010 Bid Committee”). According to an article in the Mail & Guardian entitled “FIFA: Who in SA did dirty cup deal” and published on 29 May 2015 (which article is attached hereto marked annex “A”), the 2010 Bid Committee included Jordan and Oliphant, as well as Irvin Khoza, Koos Bekker, Selwyn Nathan, Michael Katz, Raymond Hack and Kaizer Motaung. These individuals were also all members of the Local Organising Committee for the 2010 World Cup (“the LOC”).
6. It has since emerged that the award of the 2010 World Cup was influenced by the giving of bribes. In a guilty plea made before a court of the United States of America on 3 June 2015 by Charles Blazer (“Blazer”), a former member of FIFA’s executive committee, Blazer indicated that “I and others on the FIFA executive committee agreed to accept bribes in conjunction with the selection of South Africa as the host nation for the 2010 World Cup. Among other things, my actions described above had common participants and results” (the relevant page of Blazer’s guilty plea is attached hereto marked annex “B”).
7. In an indictment of Jack Warner, former Vice President of FIFA (“Warner”), among other FIFA officials, issued on 22 May 2015 (attached hereto marked annex “C”; “the indictment”), in the United States District Court, Eastern District of New York, it was revealed that at least two South African officials were central to the 2010 World Cup bribery. These individuals are not named in the indictment and are identified only as “co-conspirators” #15 and #16 (see page 27 of the indictment). It is expected that he identity of these individuals will be confirmed during the criminal process in respect of Warner and his co-accused. The two individuals are, however, described as high ranking members of the 2010 Bid Committee and the LOC. Accordingly, it is likely that these two individuals are among the eight individuals set out at 5 above.
8. In the indictment, co-conspirator #15 is described as, among other things, having met with an agent of Warner’s (described as co-conspirator #14) in a hotel room in Paris, France. This meeting was to exchange “a briefcase containing bundles of U.S. currency in $10,000 stacks”. Co-conspirator #14 left France the same day he arrived carrying the briefcase (see page 81 of the indictment).
9. It also appears that during the bidding process, and prior to the award of the 2010 World Cup to South Africa in May 2004, it was communicated to Warner that the 2010 Bid Committee was “prepared to arrange for the government of South Africa to pay $10 million to [the Caribbean Football Union (“CFU”)] to ‘support the African Diaspora.’” It was understood that this payment would be made in exchange for the agreement of Warner, and certain other individuals on FIFA’s executive committee (collectively, “the bribed FIFA officials”), to vote for South Africa to host the 2010 World Cup. Warner apparently accepted the offer and agreed to transfer at least $1 million of that amount to an individual identified only as co-conspirator #1. It was apparently agreed, however, that the amount would only be paid after South Africa was awarded the 2010 World Cup. The bribed FIFA officials later indicated that they indeed voted for South Africa to host the 2010 World Cup (see page 82 of the indictment).
10. Before the amount was paid, the bribed FIFA officials were informed that “the South Africans were unable to arrange for the payment to made directly from government funds. Arrangements were thereafter made with FIFA officials to instead have the $10 million sent from FIFA – using funds that would otherwise have gone from FIFA to South Africa to support the World Cup – to CFU” (see pages 82 – 83 of the indictment).
11. The instructions to do exactly this appears to have been given by Jordaan himself in his capacity as chief executive officer of the LOC in a letter dated 10 December 2007, in which Jordaan writes to FIFA’s General Secretary Jerôme Valcke (“Valcke”), among other things “I want to suggest that FIFA deducts this amount (US$10.0m) from the LOC’s future operational budget and deals directly with the Diaspora Legacy support programme”. This letter is attached hereto marked annex “D”.
12. A further instruction was issued by Oliphant in a letter to Valcke dated 4 March 2008, seemingly in his capacity as president of SAFA, in which he records that SAFA “requests that FIFA withholds an amount of US$10 million from the [LOC’s] future operational budget funding and thereafter advances the amount withheld to the Diaspora Legacy” and that the “Diaspora Legacy Programme be administered and implemented directly by the President of [the Confederation of North, Central American and Caribbean Association of Football (“CONCACAF”)] who shall act as a fiduciary of the Fund”. The letter is attached hereto marked annex “E”. Warner was, at the time, the President of CONCACAF.
13. FIFA officials in Switzerland effected the instructions of Jordaan and Oliphant during January 2008 by transferring an amount of US$10 million in three tranches to accounts held in the name CFU and CONCACAF but controlled by Warner (see page 83 of the indictment). Warner then proceeded to siphon off and launder the money transferred into the CFU and CONCACAF accounts into his own personal accounts, as well as accounts belonging to the individual identified only as co-conspirator #1 (pages 83 to 86 of the indictment).
14. It thus appears that Jordaan and Oliphant were complicit with, and indeed seemingly central to, the bribery scheme described in the indictment and mentioned by Blazer in his guilty plea as they have each personally signed letters issuing instructions to give effect to the payment of a bribe to the bribed FIFA officials.
15. Against the above background, it is my suspicion that numerous offences may have been committed by numerous persons relating to the transactions discussed above. At the very least, however, I believe there are reasons to suspect that, at the very least, Jordaan and Oliphant are guilty of the crimes of (a) general corruption under Section 3 of the Corruption Act; and (b) fraud.
16. I suspect that further offences may have been committed by Jordaan and Oliphant, evidence of which further offences I suspect will be revealed during the course of investigation.
17. I also suspect that other individuals may have committed related offences, which individuals and offence I suspect will be revealed during the course of investigation.
18. Section 3 of the Corruption act provides that: “Any person who, directly or indirectly… [inter-alia] gives or agrees or offers to give to any other person any gratification whether for the benefit of that other person or for the benefit of another person, in order to act, personally or by influencing another person so to act in a manner:
(i) that amounts to the – (a) illegal, dishonest, unauthorized, incomplete, or biased… exercise, carrying out or performance of any powers, duties or functions arising out a constitutional, statutory, contractual or any other legal obligation;
(ii) that amounts to – (a) the abuse of a position of authority; (b) a breach of trust; or (c) the violation of a legal duty or a set of rules;
(iii) designed to achieve an unjustified result; or (iv) that amounts to any other unauthorised or improper inducement to do or not do anything, is guilty of the offence of corruption.”
19. It must be noted that the definition of “gratification” under Section 1 of the Corruption Act is very broad and includes “money, whether in cash or otherwise . . . any donation, gift . . . reward . . . or any other similar advantage . . . any forbearance to demand any money or money’s worth or valuable thing . . . any other service or favour or advantage of any description . . . any right or privilege . . . any valuable consideration or benefit of any kind . . .” The agreement, offer to give, or giving of any gratification
20. It appears that Jordaan and Oliphant, among others, offered, agreed to give, and indeed gave gratification to Warner, among other individuals on the executive committee of FIFA. Such gratification took the form of:
20.1 the US$10 million bribe, purportedly paid to CFU and CONCACAF to “support the African Diaspora” (“the bribe”) but in fact paid as a donation, gift, reward, or other similar advantage; and/or 20.2 forbearance to demand, or a right to claim, the amount of the bribe from FIFA officials in Switzerland; and/or
20.3 A promise to cause the payment of the amount of the bribe, through intermediaries, to Warner and other members of the FIFA executive committee, which promise constituted, among other things, a favour and/or advantage of any description, and/or a valuable consideration or benefit.
21. The high level details of the offer, the agreement to give and the giving of this gratification are set out in the indictment. Oliphant and Jordaan’s direct involvement in the offer, agreement to give and the giving of the gratification is evidenced by the letters attached hereto marked annexes “D” and “E”.
22. This gratification was given for bribed FIFA officials, including Warner and the individual described only as co-conspirator #1 in the indictment. In order to act, personally or by influencing other people to act in a certain manner unlawfully
23. It appears from the indictment that the giving of the bribe to Warner was in order to influence him, as well as other FIFA executive committee members to exercise their votes to select South Africa as the successful bidder for the 2010 World Cup. It is sufficient that Jordaan, Oliphant and any other had the intention to influence Warner as well as other FIFA executive committee members. In any case, Warner, as well as other FIFA executive committee members, did indeed cast their votes in favour of South Africa.
24. Though I do not doubt that South Africa may very well have been the appropriate choice to host the 2010 World Cup, the fact that Warner and the other FIFA executive committee members exercised their votes in favour of South Africa in exchange for the gratification discussed above, renders the exercise of their vote in this way, among other things:
26.1 An illegal, dishonest and/or biased exercise of their powers in the context of their contractual and FIFA constitutional obligations as members of the FIFA executive committee;
26.2 The abuse of their positions of authority as members of the FIFA executive committee;
26.3 A breach of trust or the violation of a legal duty or a set of rules which apply to them as members of the FIFA executive committee;
26.4 Potentially caused an unjustified result, in that the result should have arisen from a vote uninfluenced by the prospect of personal gain on the part of the FIFA executive committee; and/or
26.5. An improper inducement to vote in favour of South Africa.
The offence of corruption
25. Accordingly, as it appears that all of the requirements under section 3 of the Corruption Act are present, and on the basis set out above, there is good reason to believe that Jordaan and Oliphant are guilty of the offence of corruption under section 3 of the Corruption Act.
26. Fraud consists in unlawfully making, with the intent to defraud, a misrepresentation which causes actual prejudice or which is potentially prejudicial to another.
Making of the misrepresentation
27. As appears from the indictment, members of the South African LOC intended to transfer the bribe to induce the Warner and other members of the FIFA executive committee to vote in favour of South Africa to become the successful bidder for the 2010 World Cup.
28. In Oliphant’s letter (annex “E”), however, Oliphant misrepresents the bribe as a legitimate transaction based on a “decision by the South African Government that an amount of US$10 million be paid to the [LOC]” “thereby reducing the [LOC]’s overall budget” and that FIFA should accordingly withhold “an amount of US$10 million from the [LOC]’s future operational budget funding and thereafter [advance] the amount withheld to the Diaspora Legacy Programme”. It is suspected that Oliphant thereby misrepresented the nature of the proposed transaction, disguising the bribe as a donation to the Diaspora Legacy Programme arising from a surplus in the LOC’s budget caused by a transfer of money from the South African government.
29. Likewise, in Jordaan’s letter (attached hereto marked annex “D”), Jordaan states that “the South African Government has undertaken to pay an amount equivalent to US$10.0m towards the 2010 FIFA World Cup Diaspora Legacy Programme”. Jordaan relies on discussions with the then Deputy Minister of Finance, Jabu Moleketi, and the then Minister of Foreign Affairs, Dr Nkosazana Dlamini Zuma, as confirmation of this instruction. It is suspected that Jordaan thereby misrepresented the nature of the proposed transaction, disguising the bribe as a donation to the Diaspora Legacy Programme on the instruction of the then Deputy Minister of Finance and the then Minister of Foreign Affairs.
30. – Accordingly, both Jordaan and Oliphant appear to have made misrepresentations with respect to the nature of the transaction in an attempt to disguise the payment of the bribe. It appears that these misrepresentations were made to FIFA’s General Secretary, as well as to members of the South African cabinet.
Causes And Actual Prejudice
31. – The US$10 million transferred to the CFU and CONCOCAF bank accounts as the bribe should have been transferred to the LOC. Instead, the South African government transferred the equivalent of US$10 million to the LOC to make up for the shortfall. This unlawful expenditure of tax payers’ money clearly and actually prejudices both the South African state and the public.