Sochi Corruption Investigation Seen As Stunt

Russian President Dmitry Medvedev has ordered an official corruption investigation over alleged bribes related to construction in Sochi ahead of the city's 2014 Winter Olympics. Many is Russia view the investigation as a fluff effort to try to convince people that the government is acting against corruption.

The Novaya Gazeta story focuses on Vladimir Leshchevsky, deputy of construction in the Kremlin's Office of Presidential Affairs – a vast empire that owns about $500 billion worth of former Soviet Communist Party property. It alleges that he took about $5.7 million in kickbacks from the Moskonversprom consortium of construction companies in connection with the renovation of two Kremlin-owned Sochi area sanitoriums.

"To really fight corruption he would have to fire [Prime Minister Vladimir] Putin, who is at the center of the Sochi Olympic scandal, but that's not going to happen," says Boris Nemtsov, a former deputy prime minister and a leader of the liberal opposition who ran unsuccessfully for mayor of Sochi in polls last year that some criticized as Kremlin-manipulated. "So he orders an investigation of Leshchevsky, a nobody. It's just a PR action."

Medvedev orders corruption investigation into Putin's Sochi Olympics
The Christian Science Monitor
July 29, 2010

Russia's Corruption Builds $7.8 Billion Road

Corrupt practices in Russia have greatly ballooned the costs of simple road projects ahead of the 2014 Winter Olympics in Sochi, according to a recent article from the Russian edition of Esquire magazine.

Corruption in Russia has made road-building so expensive that the same stretches of highway could be coated in an eight-inch thick layer of foie gras for the same price, a study has found.

The decision to publish the bizarre calculation in the Russian edition of Esquire magazine was designed to embarrass the Kremlin, which has failed to tackle endemic corruption in the industry. The magazine used one road, being built for the 2014 Winter Olympics in the southern town of Sochi, as an example. The price tag for the 50-kilo-metre long road is $7.8 billion Cdn, more than the entire costs of the Vancouver Olympics including the upgrades to the Sea to Sky Highway.

Read more: http://www.vancouversun.com/news/road+Sochi+costs+billion+corruption/3308038/story.html#ixzz0uQmjuj5a

One road in Sochi costs $7.8 billion due to corruption
Daily Telegraph via The Vancouver Sun
July 22, 2010

Soccer and Government Officials Implicated in Million-Dollar Graft Case

A new investigation by the Sowetan newspaper alleges that a committe had voted to give members of the Local Organizing Committee and the South African Football Association a deep cut of the proceeds from the 2010 World Cup. Many high ranking government officials have been implicated in the investigation. Roughly 50 million Rand (~$6.7 million USD) would have been split by the officials. The payoffs have been referred to by some officials as "bonuses".

The committee, led by Oliphant as president and Khoza as his deputy, voted at a meeting to reward members of the Local Organising Committee (LOC) board 10percent while Safa executives stood to pocket 5percent of the spoils, estimated at between R500million and R1billion – a windfall from the June 11 to July 11 soccer showpiece.

Shockingly, associations of Safa were to be given a paltry 5 percent.

This was uncovered by Sowetan after a lengthy investigation and eventually confirmed by a number of highly-placed sources in the soccer fraternity.

Ousted Safa bosses’ plan to loot R500m
Sowetan
April 29, 2010

Book Explores Corruption Related to 2010 World Cup

A new book investigates various conflicts of interest and instances of corruption related to the 2010 World Cup in South Africa that challenge the wisdom and value of hosting similar international events.

A book released Wednesday by the Institute for Security Studies in South Africa, titled “Player and Referee: Conflicting Interests and the 2010 FIFA World Cup,” details six case studies regarding stadium building, official suppliers, bidding practices and government oversight that cast a harsh light on the lack of transparency and public benefit of such arrangements.

The case studies, written by investigative journalists from South Africa and Britain, charge that competing interests among those seeking to benefit financially have left preparations for the 2010 World Cup vulnerable to “manipulation through the use of influence, political pressure, bribes, fraud and extortion.”

Many of these accounts have a familiar ring, addressing issues that occurred at previous World Cups. FIFA, soccer’s world governing body, has regularly faced charges of secrecy and corruption.

Book Questions World Cup Business Arrangements
The New York Times
April 28, 2010

Nelspruit's Stadium A Sore Spot for Impoverished Locals

Nelspruit's $137 million World Cup stadium has locals angry about the lack of attention officials are paying to the city's thousands of impoverished people. This piece examines the controversy surrounding the stadium, corrupt local officials and the ignored needs of locals.

Such boasts may well turn out to be true, for South Africa has spent more than $6 billion on stadiums, roads, airports and other projects. But Nelspruit, in preparing for its own six hours of championship soccer, is instead an example of the nation at its worst, with distressing inequality — measured by some economists as the worst in the world — and an epidemic of local corruption that often leads the downtrodden to rise up in anger.

Simon Magagula lives in a mud house accessible by a dirt road whose cavities deepen with each rainfall. His doorway is a short jaunt to the new stadium. “Those who’ll benefit from this are the wealthy that already have plenty in their hand,” he said, not in resentment so much as weariness.

And indeed, with the stadium project came an infusion of money, catnip to the corrupt who congregate at the junction of money and power.

Cost of Stadium Reveals Tensions in South Africa
The New York Times
March 12, 2010

Bribery Offer Reported by Stadium Construction Company

An official from a London-based construction company says the company was asked to pay a bribe of 20 million Rand (~$2.5 million) to secure a bid for a World Cup stadium.

The Daily Dispatch reported that two people allegedly approached Rumdel Construction with an offer to secure the R500-million contract for the company.

A representative of the company confirmed the incident took place, but declined to comment further for fear of the safety of his workers in the Mthatha area in the Eastern Cape.

Construction company linked to 2010 bribe
Independent Online
July 9, 2009

2010 Corruption Risk Highlighted in Report

A report from South Africa's Public Service Commission is putting the spotlight on the risk of corruption during the lead-up to the 2010 World Cup.

The report highlighted potential challenges in areas such as the capacity of the emergency services, processing the huge influx of visitors, and providing services without bias based on race, gender or disability.

"Lack of full compliance may put departments, which are involved in big programmes and tenders, at risk regarding potentially corrupt practices," the report stated.

SA must be wary of corruption linked to 2010, says report
Mail & Guardian
July 7, 2009

Crimes at Confederations Cup Bolster Security Concerns

Reports of crimes and security breaches during the recent Confederations Cup have bolstered the concerns of many who fear South Africa's high crime rate will be a blight on the upcoming World Cup. Officials, however, downplayed the recent crimes, which included some teams being robbed, journalists being mugged, and fans being forced to pay bribes to corrupt police.

Deputy security minister Fikile Mbalula downplayed concerns on Monday, saying the incidents were isolated and did not constitute any "major breach of security."

Crime threatens to mar Confed Cup
The Times
June 23, 2009

Police Demand Bribe From Reporter

This post from a Reuters sports reporter recounts a run-in with local police in Sandton City who pulled the reporter over, offered driving directions and then demanded payment.

I told them I had a very reliable SatNav. They told me it was useless and I would get lost. Only they knew where my hotel was and after giving me directions asked me for their money.

“Where are our dollars or pounds, sir ?” they asked in a more threatening manner.

I gave them their cash and they let me go.

Mind how you go, sir — a lesson with the South African police
Reuters
June 15, 2009

Host-Making an Exercise in Corruption at FIFA

Investigative sports journalist Andrew Jennings discusses the corruption that plagues FIFA in this interview with SoccerLens from October. Many topics are discussed in this lengthy interview, including the process of determining World Cup hosts, which Jennings says is corrupt.

Andrew Jennings: There are only 24 men who decide the World Cup. They don’t let women in. Most of them are not thieves. I think they are all morally corrupt because nobody raises their hand and says ‘I want to get out of here. I don’t like what is going on. We are going to take our regional Confederations and break away. We don’t like these scum.’ Not in football. Not in sport. 24 are members of FIFA’s Executive Committee. President Blatter does not cast a deciding vote. You have three from CONCACAF, your part of the world, Chuck Blazer, one of the partners with a wonderful apartment in Trump Tower, you’ve got Jack Warner in Trinidad and Tobago, Rafael Seguero from Mexico, they represent you, all sports fans know that, they claim to speak for you, but they don’t want to talk to you or spend time with you. We have 8 in Europe because we are just a bigger footballing area, there are 3 or 4 out of the African continent, and one from Oceania. These are the guys who decide who gets the World Cup. A year ago, I presented a BBC programme documenting the bribes, how Germany won the votes to host the last World Cup in 2006.

SoccerLens: As a follow up to the last question, could you discuss if there were any irregularities about the bidding process for World Cup 2006?

Andrew Jennings: What you need to know for any World Cup bid, there is no accountability or transparency. Partly because they get away with it, and frankly, the coverage of journalists is not as good as it could be. Money has gone through Caribbean banks, or accounts in Lichtenstein. There is no question since Joao Havelange, the Brazilian, took over, in 1974, corruption immediately followed. Before him, there was the Englishman, Sir Stanley Rous. Now, I am not being patriotic about it, but Stan Rous was clean. He may have been a bit of a bumbling old fool, but he would never take a bribe.

Havelange with his gang arrived, and Sepp Blatter, and boy was football corrupt from then on. So bribes were paid for contracts, but in South Africa, the government had a policy that they would not pay bribes. Morocco paid. People who take bribes don’t always do what you ask of them. You can’t go to the police and say ‘I bribed that guy. He didn’t deliver the World Cup.’

Now what happened with Germany was, they had a very good position, they have great football tradition and Blatter behind them, Africa wasn’t going to vote for them, they were nearly there, they didn’t need many votes, so what happened, I’ve got the documents on this, there was one guy who stood to make the most money out of this was the German TV mogul, Leo Kirch. He has the biggest film library outside of Hollywood. He’s a very astute businessman. He has sports stations in Germany, if he could get the World Cup to Germany, he’d make a lot of money due to television rights.

Source:
Vote Rigging and Ticket Scandals at FIFA
SoccerLens
October 22, 2008