Just about 10 days ago, the feds handed down a 47 counts, 161 pages, wide-ranging racketeering indictment against top executives of the Federation Internationale de Football Association ("FIFA"), world soccer's governing body, its constituents, as well as some US-based sports marketing companies. The indictment alleges that FIFA officials regularly engaged in a pattern of criminal activity that included bribery, fraud, kickbacks and money laundering. The indictment takes advantage of the RICO statute's generous reach-back provisions that allow prosecutors to all-but ignore standard statute of limitations restrictions as long as two racketeering offenses are committed within 10 years of each other (one of which was after the RICO statute was enacted). Initially, the prosecution prompted some serious head scratching, as in: Is FIFA really what the US Congress originally had in mind for a Criminal Enterprise?; and, With most of the acts occurring outside the U.S., how does the Eastern District of New York have jurisdiction over crimes occurring in Europe and countries outside the U.S.? As someone who has both prosecuted and defended criminal RICO cases, it's easy for me to answer both questions. First, though, a quick primer on RICO is probably in order.
RICO makes it "unlawful for anyone employed by or associated with any enterprise engaged in, or activities of which affect interstate or foreign commerce, to conduct or participate, directly or indirectly, in the conduct of such enterprise's affairs through a pattern of racketeering activity or collection of unlawful debt." For someone to be found guilty of violating the RICO statute, the government must first prove each of five essential elements beyond a reasonable doubt: (1) the existence of an Enterprise; (2) that the Enterprise engaged in, or that its activities affected interstate commerce; (3) that the defendant was employed by, or associated with , the Enterprise; (4) that the defendant knowingly conducted the Enterprise's affairs, or knowingly participated in the conduct of the Enterprise's affairs; and (5) the defendant knowingly conducted the Enterprise's affairs through a pattern of racketeering activity as alleged in the indictment, or engaged in a pattern of racketeering activity on behalf of the Enterprise. A "pattern of racketeering activity" is established when it is proven a defendant "committed at least two" of 35 specified criminal acts within a 10 year period of each other (one of which was after the 1970 enactment of the RICO statute), in connection with, or in furtherance of, the affairs of the subject Enterprise. Of the specified criminal acts, 27 "predicate crimes" are federal, including mail fraud, wire fraud and money laundering; 8 are state "predicate crimes," including bribery. Generally, RICO convictions call for up to 20 years maximum sentences, but when certain predicate acts are proven (such as murder, which is not alleged in the FIFA indictment), the sentence for that act is the same as though committed in state court (i.e,, if murder, the RICO defendant(s) can be sentenced to life). Accompanying forfeiture provisions are broad-based and comprehensive.
I am a frequent critic of the government trying to "square peg" its definition of what constitutes Criminal Enterprises. More and more the government routinely goes well beyond the traditional organized crime outfit, crime syndicate, and/or "mobbed up" labor union that I believe Congress originally intended to target. For example, recent prosecutions of "criminal enterprises" include teachers in Atlanta accused of changing test scores, officials in the MA Dept of Probation accused of job-rigging, and employees at a pharmaceutical compounding center accused of selling tainted drugs. Despite my usual criticisms, it's pretty hard to question how a business that allegedly regularly, and repeatedly, bribed executives, paid kick-backs and utilized a generalized "pay to play" approach as its principal way of conducting official business isn't the epitome, indeed the very dictionary definition, of a "racketeer influenced and corrupt organization." So, to me there's really no head-scratcher about FIFA being categorized as an enterprise.
As for jurisdiction, no lesser champion of individual freedoms or critic of government overzealousness than Vladimir Putin (I'm being sarcastic here, folks!) had this to say about that: "[the indictment is] another blatant attempt by the United States to extend its jurisdiction to other states." (Putin also imputed ulterior motives for the indictment saying, "I have no doubt that this is obviously an attempt to prevent Mr. Blatter's re-election to the post of FIFA president, which is a grave violation of the principles that international organizations function on.")
As to Putin's first comment about jurisdiction, though, it's clear he never read the indictment. Had he done so, he would have seen that the indictment levies charges against an organization (FIFA), which is comprised of other organizations, which are based in the United States. Indeed, 2 of the 14 named defendants in the indictment are US citizens. Moreover, one of the sports marketing companies that is a subject of the indictment is a US-based corporation. However, for those less politically invested who still have a hard time understanding how it is the U.S. has the legal authority to prosecute crimes committed outside its borders, it's important to know where defendants are from is not what confers jurisdiction on a court over a crime; what matters is whether any of the offense conduct occurred in, or was directed at, the United States. Even minimal contact with or in the U.S. is sufficient to confer jurisdiction. However, in this case, the indictment clearly states the defendants funneled proceeds from illicit kickbacks and bribes into banks and other financial institutions located within the United States. For example, the indictment states some of the following activities not only occurred here in America, but actually within the Eastern District of New York (Brooklyn, Queens, Staten Island, Long Island, etc): "the use of various mechanisms, including trusted intermediaries, bankers, financial advisors, and currency dealers, to make and facilitate the making of illicit payments; ...the structuring of financial transactions to avoid currency reporting requirements; bulk cash smuggling; the purchase of real property and other physical assets; the use of safe deposit boxes; income tax evasion; and obstruction of justice." All of which is why the prosecution was originally approved and initiated by then EDNY US Attorney, now US Attorney General, Loretta Lynch.
Whether or not the feds should be levying charges against FIFA, which is truly an international organization, is one thing. Whether or not the feds can do so under American law is quite another thing. Assuming the allegations contained in the indictment are true, which is presumed in federal court at this stage of the proceedings, there is clearly more than enough activity occurring within the United States to properly confer jurisdiction on a federal court sitting in New York over the alleged illicit activities of the racketeering enterprise.
If I were defending any one of the 14 named defendants in Brooklyn (where I am licensed to practice), I would not be basing my defense on either improper subject matter jurisdiction (e.g., FIFA isn't what Congress had in mind in terms of criminal enterprises) or improper venue because neither argument is going anywhere. I suppose the question of whether a jurisdictional challenge could be mounted if a particular defendant who is technically a "member" of the racketeering enterprise, but was totally unaware, both objectively and subjectively, that illicit activity was occurring within the United States might still be an interesting issue worth exploring by those tasked with defending some of the purely international defendants. Still, were i involved, I'd instead be trying to establish that no conspiracy existed, that none of the crimes, if even committed, were perpetrated on behalf of FIFA, and that bribes and kick-backs were nothing more than a series of one-off unilateral acts committed by someone else for the sole purpose of lining his or her own pockets.
In other words, I'd be promoting an "it's every man for himself" defense strategy advocating my client should not be ultimately held responsible for the "sins" of co-defendants, of which he did not know. Unfortunately, as with all federal conspiracies, there is no requirement that RICO defendants know, or even communicate with each other. Moreover, because RICO's broad net allows the lowest employee on the FIFA totem-pole not only to be charged, but to be held as culpable as its highest ranking officer, we're more likely to see a "first one to the lifeboat" approach, where low-ranking defendants will scramble to cut deals with federal prosecutors in exchange for testimony against those higher-up. Indeed, the "it takes a rat to catch a cat" ethos is not only why the Feds love RICO, but why RICO can be so devastatingly effective.
With multi-jurisdictional, international nexus, I'm guessing the exchange of required discovery will be a nightmare and measured by gigabytes as opposed to pages produced. I'm also guessing — actually, parroting what I've heard — what we've seen in this first wave is simply the proverbial "tip of the iceberg" and that more prosecutions will follow and/or defendants will be added by way of superseding indictment. In other words, we're not just eons away from full time here, we're not even close to kick-off. For me, the interest is less in terms of what the ultimate outcome will be and more in how many players are going to change sides; and just how quickly they will try to do it.
 The named defendants are: Rafael Esquivel, Nicolas Leoz, Jeffrey Webb, Jack Warner, Eduardo Li, Eugenio Figueredo, Julio Rocha, Costas Takkas, and Jose Maria Marin (the FIFA officials); Alejandro Burzaco, Aaron Davidson, Hugo Jinkis, Mariano Jinkis, and José Margulies (the corporate executives).
If you have this type of case contact Brad Bailey one of the top criminal defense lawyers in Boston.