28 May 2021
Federal prosecutors offered Swiss bank Julius Baer & Co. on Thursday (27 May 021) a deferred prosecution agreement to pay a criminal fine and forfeiture of about $80 million for money laundering charges related to bribes involving the international soccer governing body FIFA. Julius Baer agreed to this settlement and will not face a criminal trial so long as the bank abides by the terms of the agreement for the next 42 months.
The prosecutors formally charged the bank with money laundering conspiracy in the federal court in Brooklyn, New York. The deferred prosecution agreement was disclosed during an arraignment hearing for the bank.
The bank helped laundering of $36.37 to bribe the sports officials. The bank agreed to pay that amount in forfeiture. The balance amount of the $80 constitutes criminal fine.
According to the terms of the agreement the bank admits that the criminal allegations against it are true and accurate, and that they can be used against Julius Baer in other proceedings.
Switzerland’s third-largest private bank has said it has cooperated with the Justice Department since 2015. It has also said it has upgraded its compliance controls and dismissed some clients.
From February 2013 through May 2015, a former client relationship manager of the bank, Jorge Luis Arzuaga, conspired with sports marketing executives to launder the bribes through the United States to soccer officials for broadcast rights, the Justice department said. Alejandro Burzaco, was the controlling executive of Argentina-based Torneos y Competencias S.A. and was involved in the laundering scheme. The DOJ said that Burzaco and co-conspirators agreed to pay approximately $30 million to the senior vice president of FIFA, who was also the president of the Asociación del Fútbol Argentina, for his support in the award of regional broadcasting rights to the 2018, 2022, 2026 and 2030 editions of the World Cup.
In total, seven FIFA officials were arrested on 27 May 2015 on suspicion of receiving US$150 million in bribes. The arrests triggered Australia, Colombia, Costa Rica, Germany and Switzerland to tart or intensify their own criminal investigations into top FIFA officials for corruption.
The Justice Department commenced the FIFA probe in April 2015. Since then more than 40 people were charged and more than 30 pleaded guilty.
FINMA, the Swiss financial regulator, has also imposed penalties for Julius Baer’s anti-money laundering shortfalls, and ordered the bank to improve its controls and appoint an auditor.