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BRUSSELS ― The European Parliament thinks football stinks.
Concerned that transfers and sponsorship deals might be about as watertight as Manchester United’s defensive line, lawmakers are pushing for governments to back down in their opposition to soccer clubs being included in an EU law cracking down on money-laundering.
“Member states refuse to subject football clubs, leagues and agents to the basic rules of due diligence,” said Green MEP Damien Carême, co-leader of the Parliament’s negotiations and a fan of Racing Club de Lens in France. “This is a godsend for thugs and oligarchs, who will be able to carry on with their little business of match-fixing and dubious transfers with complete impunity.”
The Parliament’s demands are the latest step in wrangles over an EU plan proposed two years ago to streamline Europe’s safeguards against money laundering across the board, which currently differ from country to country. The talks, between the Commission, Parliament and the Council, representing national governments, are deadlocked, in part because countries are resisting the inclusion of football in the legislation.
While it could be argued global soccer and corruption go hand-in-hand ― in 2015, U.S. authorities indicted nine officials from the Fédération Internationale de Football Association (FIFA), which governs the game across the world, for racketeering, conspiracy and corruption ― insiders suggest that money-laundering, though less obvious, might be rife. Europol and the European Commission have highlighted the industry risks in reports in recent years.
As Carême put it, “football is a key sector for money laundering,”
Operation Zero
The way it often works is this: Since criminals struggle to spend money they make from illegal business without attracting attention from authorities, they funnel it through legitimate companies to make it look like the cash is clean. As far as football is concerned, a common technique is to inflate the price of a player transfer and then pass the additional proceeds back to the underworld.
One of the countries that appear to have had a particular problem is Belgium. An investigation called “Operation Zero” exposed money laundering gangs operating in Belgian football clubs in 2018. The probe led to a crackdown on the league, forcing clubs to introduce new safeguards.
But it’s Belgium’s experience in particular that gives governments pause for thought.
The country’s safeguards turned into a burdensome box-ticking exercise rather than an effective way to fight money launderers, according to Niels Appermont, professor of economic law at Hasselt University, who researched the rules with the help of a grant from UEFA. (At no point did UEFA intervene in the study, he said.)
“I do see and acknowledge major problems in this sector,” Appermont said. “Our point in the Belgian case is that if you want to tackle these problems well” then you should “not use a one-size-fits-all solution and try to understand the market that you’re trying to regulate.”
Those close to the situation claim the amount of hoops that now needs jumping through and red tape that has to be navigated makes it harder for Belgian clubs, which includes Anderlecht and Standard Liège, to compete in player transfers.
MEPs have suggested introducing thresholds to shield smaller clubs from the administrative burden of due diligence checks. But governments reject that compromise.
Diverse football landscape
UEFA, the governing body of football in Europe, and Football Supporters Europe (FSE), which represents fans, are lobbying in Brussels to get their voice heard in the negotiations. They have urged lawmakers to first consult and then create a tailored set of rules for the sport, including anti-money laundering safeguards.
They say applying a one-size-fits-all approach without assessing the consequences could disadvantage smaller clubs that aren’t equipped to handle the paperwork.
“EU policymakers should appropriately engage with football stakeholders in assessing impacts and developing policy options that meet our shared objectives without risking unintended consequences across Europe’s diverse football landscape,” a UEFA spokesperson said.
