One of the star prosecution witnesses in the corruption trial of three former football officials on Tuesday revealed how international broadcasters paid millions of dollars in bribes to secure television rights for games.
Alejandro Burzaco, the former chief executive of an Argentinian sports marketing company, said he partnered with companies including Fox Sports, Mexico's Grupo Televisa and Brazil’s Globo in deals that included kickbacks to win lucrative deals.
None of the three companies named by Burzaco has been charged in the case.
He offered his evidence on the second day of the trial of Jose Maria Marin, 85, former head of Brazil's football federation; Manuel Burga, 60, former president of the Peruvian football federation; and Juan Angel Napout, 59, former president of Conmebol, who have each pleaded not guilty to racketeering, wire fraud (financial fraud involving the use of telecommunications or information technology) and money laundering conspiracies.
Prosecutors say they profited from a culture of corruption that cost world football about $200 million over almost a quarter of a century.
Their trial in New York is the first to emerge from an American investigation that erupted into public view with the arrest of Fifa officials at a Zurich, Switzerland hotel in May 2015.
Burzaco, who has pleaded guilty to his role, said he paid bribes to all three defendants and described how his company, Torneos y Competencias, used fake contracts to hide its bribes.
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[ Bribes paid to South American football officials accused of $200m corruption ]
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The money came from T&T, a joint venture between Torneos y Competencias and Fox Pan-American Sports – a subsidiary of 20th Century Fox – and was paid to senior officials at Conmebol, which governs football in South America, to ensure control of TV rights for its tournaments.
For example in 2008, T&T extended its deal for the rights the Copa Libertadores and the Copa Sudamericana club competitions, he said.
“Did you pay bribes in connection with those contract extensions?” asked Samuel Nitze, US assistant attorney for the eastern district of New York.
“Yes sir,” answered Burzaco, explaining they went beyond recurring annual payments which were already being made. “Special bribes for the extension of the contracts.”
Nicolas Leoz, the then-president of Conmebol, and Julio Grondona, Fifa vice president, received $1m. Three junior officials received $500,000 to ensure the contract was not put out to tender, he said.
The rewards for his company, he said, were a guaranteed stake in the exploding South American TV market for football until 2018 (a four-year extension). Fox Sports also won a share, he said, at a time it was launching additional channels.
As evidence of the scheme, prosecutors at the trial at a federal court in New York City produced a 2008 agreement for the partnership to pay $3.7m to a company in Turks and Caicos that was supposed to act as an intermediary in the deal.
Burzaco testified that it was not a real contract of service but instead a conduit for bribes.
His evidence is expected to continue on Wednesday, shining further light on the way money was paid for preferential treatment.
Each of the defendants on trial rose to become president of his country’s football federation, and Napout eventually took over as president of Conmebol in 2014
Although more than 40 individuals have been charged in the far-reaching investigation, they are the only ones to continue to maintain their innocence after extradition to the US.
Each faces up to 20 years in prison.
“These defendants cheated the sport in order to line their own pockets,” said Keith Edelman, assistant United States attorney, in his opening statement on Monday as he described a network of shell companies, bag men and cash drops used to siphon cash from massive marketing and TV deals.
The investigation has already revealed how senior officials at federations across North and South America pocketed bribes in order to steer television and marketing rights to favoured companies for almost a quarter of a century.
Sepp Blatter, president of the world governing body Fifa for 17 years, and other senior officials were ousted as the full extent of the taint emerged.
In their opening statements, lawyers for the three defendants urged the jury to dismiss the evidence of co-operating witnesses as unreliable.
"Some of the most corrupt people on earth," is how Bruce Udolf, who is defending Burga, put it as he suggest the witnesses faced up to 60 years in prison and would "get pretty doggone creative" to reduce their jail time.
None of the three companies named by Burzaco has been charged in the case.
Televisa spokesman Olmos Cruz Alejandro told Reuters the company could not comment without knowing more about the trial testimony.
Fox Sports spokeswoman Terri Hynes said the company had no comment.
Globo denied the allegations and said its internal checks did not find any illegal payments.
