Former Fox Employee Convicted of Bribery for Soccer Broadcast Deals
The employee, Hernán López, and an Argentine marketing firm were accused of helping make illegal payments for rights to tournaments in South America.After hearing seven weeks of often-impenetrable testimony about television contracts, codes of ethics and the interpretation of Spanish phrases in emails sent more than a dozen years ago, a federal jury in Brooklyn on Thursday convicted a former Fox employee and an Argentine sports marketing firm of paying bribes in exchange for lucrative soccer broadcasting contracts.Prosecutors said that Hernán López, who until 2016 worked for a unit of what was then known as 21st Century Fox, had taken part in a complex scheme to make millions of dollars in secret annual payments to the presidents of national soccer federations in order to secure the rights to the Copa Libertadores and the Copa Sudamericana, widely viewed South American soccer tournaments. Full Play Group, the marketing firm, stood accused of similar but far more extensive corruption. Prosecutors said it paid bribes for the rights to World Cup qualifiers, exhibition matches, the Copa América tournament and the Copa Libertadores.The government also argued that López had taken advantage of “loyalty secured through the payment of bribes” to secure inside information that helped Fox beat out ESPN in its bid for the United States broadcasting rights for the 2018 and 2022 men’s World Cups — a theory Fox has vigorously denied. Fox was never accused of any wrongdoing.López, who holds dual American and Argentine citizenship, was convicted on one count of money laundering conspiracy and one count of wire fraud conspiracy and faces up to 40 years in prison. Full Play was convicted on six fraud and money laundering counts and, as a corporation, could face financial penalties.A third defendant, Carlos Martínez, who worked under López at Fox, was acquitted on counts of wire fraud conspiracy and money laundering conspiracy.The convictions represent what Breon S. Peace, the U.S. attorney for the Eastern District of New York, called “a resounding victory” in the Justice Department’s sweeping investigation of corruption in international soccer.After a secret inquiry began in 2010, the case broke into public view in May 2015 when sensational predawn arrests were made in Zurich, the city that FIFA, soccer’s world governing body, calls home. Since then, more than two dozen individuals and entities have voluntarily pleaded guilty to a wide variety of charges, including racketeering and wire fraud. And in 2017, a different federal jury convicted two soccer officials, from Paraguay and Brazil, on wire fraud conspiracy and other charges.Prosecutors indicted López, Martínez and Full Play in March 2020, signaling that the long-running case — which shook FIFA to the core and resulted in a shakeout of several generations of leadership in its ranks — still had legs.“The defendants cheated by bribing soccer officials to act in their own greedy interests rather than in the best interests of the sport,” Peace said in a statement following the verdict. Judge Pamela K. Chen rejected a request from prosecutors that López be taken immediately into custody, instead releasing him with tightened bond restrictions. A sentencing date has not been set.John Gleeson, a lawyer for López, said in a statement that “we are obviously disappointed with the jury’s verdict.”He continued, “The proceedings have involved both legal and factual errors, and we look forward to vindicating our client on appeal.” Lopez, who left Fox in early 2016, went on to found the podcasting company Wondery, which was sold to Amazon in 2020 in a deal that valued the company at a reported $300 million.Carlos Ortiz, a lawyer for Full Play, declined to comment. The company was founded by an Argentine father and son, Hugo and Mariano Jinkis, who were charged in 2015 but were not extradited. A lawyer for Hugo Jinkis said he could not immediately comment on the news.“We are very grateful for the jury’s service,” Steven McCool, Martínez’s lead lawyer, said in a brief call after the verdict. “Carlos received justice today and it was a long time coming.”A watch party in Los Angeles for the 2022 World Cup. Fox had the U.S. English-language rights for last year’s tournament in Qatar and the 2018 tournament in Russia.Mark Abramson for The New York TimesThursday’s verdict came on the fourth day of deliberations after a complex and slow-moving trial. Jurors were presented with reams of contracts, financial spreadsheets and bank transfer statements, as well as expert witnesses who debated whether a particular phrase meant “pay him less” or “pay it less.”At one point, early in the trial, Judge Chen admonished the lead prosecutor, Kaitlin T. Farrell, for reading entire emails about corporate issues into the official record, warning that she risked losing the jury’s attention.And as in the first trial in the case, the government relied particularly heavily on a single star witness: Alejandro Burzaco, the former chief executive of the Argentine sports marketing and TV production firm Torneos, who pleaded guilty in the case in 2015 and has been cooperating with the U.S. government since.Over 11 days of testimony, he described in painstaking and sometimes stultifying detail the esoteric series of shell companies and phony contracts that had been used to pay bribes to soccer officials through a joint venture owned by Torneos and 21st Century Fox. Although he personally arranged the payments, Burzaco said he had informed both López and Martínez about their existence and said that neither executive had done anything to halt them.Burzaco also detailed using a relationship cultivated through bribes paid to Julio Grondona — a FIFA vice president and a longtime president of Argentina’s soccer association who died in 2014 — to gain inside information that helped Fox win the U.S. English-language rights to the 2018 and 2022 World Cups. ESPN had long held that coveted property.Although bidding was supposed to have been blind, Burzaco said he had asked Grondona in late 2011 for help at López’s request. Burzaco testified that Grondona had “told me if Fox puts $400 million, they are going to award it to Fox — tell your friends.” Fox ultimately paid $425 million, and several years later obtained rights to the 2026 World Cup, to be held in the United States, Canada and Mexico.Over howls of protest from defense lawyers, prosecutors called the former ESPN president John Skipper to testify about the incident. “I was disappointed,” he said. “In fact, I was angry.”In a statement after the verdict, a Fox spokesman said, “This case does not involve Fox Corporation, and it was made clear that there was no connection to Fox’s successful World Cup bids.” The company has in the past noted that the unit where López and Martínez worked, Fox International Channels, was spun off in 2019 and that it was a different division, Fox Sports, that was charged with negotiating for those rights.Although both López and Martínez maintained their innocence, claiming they were never aware any bribes had been paid, Full Play took a decidedly different tack. Its lawyers readily admitted that the company had made regular payments to Latin American soccer officials but claimed that those payments had not been bribes but simply the standard way of doing business when it came to South American soccer.Ortiz, the lawyer for Full Play, said in his closing arguments late last week: “You can look at it and, say, hey, do I like this morally? Do I think this is appropriate?” But, he added, “all of these executives and officers acted in a manner and behaved and carried themselves in a manner that sent a clear, strong message that their receipts of payments were totally fine.” More
