Press releases 30th April 2020

Bank Hapoalim Agrees to Pay More Than $30 Million for Its Role in FIFA Money Laundering Conspiracy

• Bank Hapoalim B.M. and Hapoalim (Switzerland) Ltd. Enter Into Three-Year Non-Prosecution Agreement

Bank Hapoalim B.M. (BHBM), an Israeli bank with international operations, and its wholly owned subsidiary, Hapoalim (Switzerland) Ltd. (BHS), have agreed to forfeit $20,733,322 and pay a fine of $9,329,995 to resolve an investigation into their involvement in a money laundering conspiracy that fuelled an international soccer bribery scheme. Specifically, BHBM and BHS have admitted that they, through certain of their employees, conspired to launder over $20 million in bribes and kickbacks to soccer officials with Fédération Internationale de Football Association (FIFA) and other soccer federations.

“For nearly five years, Bank Hapoalim employees used the U.S. financial system to launder tens of millions of dollars in bribe payments to corrupt soccer officials in multiple countries,” said Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division. “Today’s announcement demonstrates the department’s commitment to holding financial institutions to account when they knowingly facilitate corruption and other criminal conduct.”

“Today’s resolution marks another successful chapter in this district’s effort to hold accountable those corporations and individuals who participated in a bribery scheme that corrupted international soccer,” stated U.S. Attorney Richard P. Donoghue of the Eastern District of New York. “This office, along with our law enforcement partners, will continue to identify wrongdoers who manipulate international soccer in order to reap illicit profits and bring them to justice.”

“This announcement illustrates another aspect in the spider web of bribery, corruption and backroom deals going on behind the scenes as soccer games were played on the field,” said Assistant Director in Charge William F. Sweeney of the FBI’s New York Field Office. “Bank Hapoalim admits executives looked the other way, and allowed illicit activity to continue even when employees discovered the scheme and reported it. The New York FBI Eurasian Organized Crime Task Force and our law enforcement partners have doggedly pursued every strand uncovered in this criminal investigation, and will keep at it until they root out all of the bad actors.”

“This forfeiture sends a clear message that no matter how complex or far reaching the conspiracy, justice will prevail. Bank Hapoalim B.M. and its subsidiary, Hapoalim Ltd., participated in a conspiracy that corrupted international soccer, its confederations, and member associations,” said Special Agent in Charge Ryan L. Korner of the IRS-Criminal Investigation (IRS-CI) Los Angeles Field Office. “IRS-CI is proud to work alongside our international law enforcement partners, the FBI, and the United States Attorney’s Office to bring closure to this egregious international scandal that corrupted the sport of soccer.”

According to admissions in the statement of facts stipulated to by BHBM and BHS as part of the agreement, from approximately Dec. 10, 2010, to Feb. 20, 2015, BHBM and BHS personnel conspired with sports marketing executives, including executives associated with Full Play Group S.A. (Full Play), a sports media and marketing business based in Argentina, and others, to launder at least $20,733,322 in bribes and kickbacks to soccer officials. In exchange for those bribes and kickbacks, the soccer officials awarded or steered broadcasting rights for soccer matches and tournaments to the sports marketing executives and their companies.

Full Play allegedly executed the illegal payments from accounts at BHS and BHBM’s branch in Miami, Florida, which were held in the names of Full Play subsidiaries and affiliates. On March 18, 2020, Full Play was charged along with others in a superseding indictment in the Eastern District of New York with racketeering conspiracy, wire fraud, wire fraud conspiracy, and money laundering conspiracy.

BHBM and BHS also admitted they conspired to launder money for Luis Bedoya, who at various times served as the president of the Federación Colombiana de Futbol, a vice president of the Confederación Sudamericana de Fútbol (CONMEBOL), and a member of FIFA’s executive committee. BHBM’s Miami branch and BHS allowed accounts controlled by Bedoya to be used to receive illicit bribe and kickback payments. Bedoya pleaded guilty to racketeering conspiracy and wire fraud conspiracy on Nov. 12, 2015, in the Eastern District of New York.

Notwithstanding the repeated concerns raised by BHS compliance personnel about certain payments made to soccer officials from the accounts associated with Full Play, BHS failed to take action. Instead, the banks’ relationship managers continued executing illicit bribe and kickback payments on behalf of Full Play.

Under the agreement, BHBM and BHS will jointly pay a criminal penalty of $9,329,995. The banks will additionally forfeit funds totaling $20,733,322.

As outlined in the agreement, the government’s decision to enter into a non-prosecution agreement with BHBM and BHS was premised upon the banks’ thorough and complete cooperation and the banks’ other substantial remedial efforts, which have included closing Bank Hapoalim (Latin America) S.A. and BHBM’s branch in Miami. BHS is also in the process of closing its operations.

The agreement announced today is part of an investigation led by the FBI’s New York Field Office and the IRS-CI’s Los Angeles Field Office. Trial Attorney Michael P. Grady of the Bank Integrity Unit of the Criminal Division’s Money Laundering and Asset Recovery Section (MLARS) and Assistant U.S. Attorneys Lauren Howard, Brian D. Morris, and Samuel P. Nitze of the U.S. Attorney’s Office for the Eastern District of New York prosecuted the case. Former MLARS attorneys Kendrack D. Lewis of the Justice Department’s Civil Division and Maria K. Vento of the U.S. Attorney’s Office for the Western District of North Carolina, the Criminal Division’s Office of International Affairs, and the government of Switzerland provided significant assistance in this matter.

• This media release was published by the US Department of Justice (DoJ) on 30 April 2020. Click here for the original, and click here to download the Hapoalim FIFA Non-prosecution Agreement.

You may also like...

Pin It on Pinterest

Share This