Julius Baer pays $80m in FIFA corruption settlement

Swiss bank Julius Baer will pay $79.7 million in a settlement with the US Department of Justice after being implicated in a corruption probe surrounding FIFA, the governing body of world soccer.

The US Department of Justice said: “Bank Julius Baer & Co. Ltd. (BJB or the Bank), a Swiss bank with international operations, has admitted today in federal court in Brooklyn that it conspired to launder over $36 million in bribes through the United States to soccer officials with the Fédération Internationale de Football Association (FIFA) and other soccer federations, in furtherance of a scheme in which sports marketing companies bribed soccer officials in exchange for broadcasting rights to soccer matches.

“The proceeding was held before U.S. District Judge Pamela K. Chen.

“The bank made these admissions and entered into a three-year deferred prosecution agreement with the department in connection with a criminal information filed today in the Eastern District of New York charging the bank with conspiring to commit money laundering.

“As part of this agreement, the bank has agreed to pay more than $79 million in penalties (including a fine of $43,320,000 and forfeiture of $36,368,400) to resolve the investigation into its involvement in a money laundering conspiracy that fueled this international soccer bribery scheme.

“Jorge Luis Arzuaga, a former BJB relationship manager who worked in the Bank’s Montevideo, Uruguay, and Zurich, Switzerland, offices pleaded guilty in June 2017 for his role in this conspiracy and was sentenced in November 2020.

“That case was assigned to U.S. District Judge Pamela K. Chen of the Eastern District of New York, as is this case.”

Acting Assistant Attorney General Nicholas L. McQuaid of the Justice Department’s Criminal Division said: “Today’s resolution sends a strong message to all banks and other financial institutions that if they knowingly misuse our financial system to hide their clients’ criminal proceeds or to promote a corrupt scheme, they will be held to account.

“From the time of the first FIFA-related indictment, the department has promised to hold accountable the financial institutions involved in this global criminal scheme.

“We are delivering on that promise.”

Acting U.S. Attorney Mark J. Lesko for the Eastern District of New York said: “BJB and its employees facilitated bribes and its compliance department turned a blind eye to glaring red flags of money laundering.

“This office will hold accountable those corporations or individuals that use the American banking system for corrupt ends. As today’s resolution makes clear, financial institutions that become complicit in their clients’ efforts to launder illicit funds face significant penalties.”

Assistant Director-in-Charge William F. Sweeney Jr. of the FBI’s New York Field Office said: “Bank Julius Baer pursued the profit it could make laundering corrupt funds derived from a criminal scheme run by powerful FIFA officials.

“Their behavior has earned them the equivalent of a red card, and the money the bank now owes the U.S. government is more than double what it admits to laundering.

“The FBI operates globally with our international partners, and our message to those who may be looking to profit from similar schemes – the penalties for this type of play are steep. Stay within the rules.”

Special Agent in Charge Ryan L. Korner of the IRS-Criminal Investigation said: “Bank Julius Baer aided corrupt FIFA officials in laundering over $36 million.

“Banking officials that are a conduit for criminal activity undermine their own profession and the health of our financial system.

“The Bank’s admissions show that IRS-Criminal Investigation will relentlessly pursue corruption across borders, including financial institutions that facilitate or conceal criminal activity.

“This should put other banks on notice that aiding in corruption will cost you millions.”

Julius Baer said in a statement: “Julius Baer … has finalised the agreement reached with the U.S. Department of Justice (DOJ) in November 2020, as reported, to settle the FIFA-related investigation in the U.S.

“Specifically, Julius Baer has entered into a three-year Deferred Prosecution Agreement, pursuant to which it will pay the previously communicated amount of USD 79.7 million, which has already been charged against the 2020 financial results.

“Julius Baer welcomes the final resolution of this legacy matter.

“This marks another step in JuliusBaer’s continued efforts to pursue the closure of remaining regulatory and legal matters incooperation with the relevant authorities.”

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Mark McSherry
Dalriada Media LLC sites are edited by veteran news journalist Mark McSherry, a former staff editor and reporter with Reuters, Bloomberg and major newspapers including the South China Morning Post, London's Sunday Times and The Scotsman. McSherry's journalism has also appeared in The Washington Post, The Guardian, The Independent, The New York Times, London's Evening Standard and Forbes. McSherry is also a professor of journalism and communication arts in universities and colleges in New York City. Scottish-born McSherry has an MBA from the University of Edinburgh and a Certificate in Global Affairs from New York University.