CRIMINAL CAPITALI$M

EU Policy. 

EU’s plan for money-laundering checks on football inflamed by Chelsea claims

By Jack Schickler

Published on 17/11/2023 -

Lawmakers say allegations of misdealing by ex-owner Roman Abramovich lend credence to their crusade against dirty money in sport, though others urge caution

Recent revelations about financial misdealings at Chelsea FC have lit a fire under EU plans to make football subject to tough anti-money laundering restrictions.

EU negotiators are locked in a battle over whether to include football clubs, agents and associations under the bloc’s anti-money laundering (AML) rules, which would potentially require major sponsors and even fans to undergo extensive vetting.

Allegations which surfaced this week of complex financial transactions undertaken by ex-Chelsea owner Roman Abramovich have given extra ammunition to those MEPs keen to put football within the rules’ purview.

“The Chelsea affair shows once again the inherent risks in the football sector,” Damien Carême, the French green-party lawmaker who is spearheading AML talks on behalf of the European Parliament, told Euronews in a statement, adding: “The fight against money laundering cannot endure any gaps … no risky economic sector can be exempted from oversight.”

The Bureau of Investigative Journalism (TBIJ), citing leaked documents, alleged that Abramovich made tens of millions in undisclosed payments made via offshore companies, bypassing rules intended to ensure financial fair play in the sport.

“I ask those who are against: what more proof do you need?” said Carême.

MEPs see football clubs, agents and associations as a tempting target for illicit finance, and want them to report suspicious activity to the authorities — just as banks, art dealers and diamond traders already do.

That follows a 2019 report from the Commission which highlighted the game’s “complex organisation and lack of transparency” as a money-laundering risk, and a 2020 study from EU police agency Europol which alleged match-fixing by mafia-style crime groups.

EU member states in the Council are less convinced. At a Tuesday, 14 November closed-door meeting, known as a trilogue, MEPs and Council members met to thrash out a final text of the AML law.

They discussed but did not reach agreement on the football issue, three sources briefed on the talks told Euronews. The Cyprus Confidential reports from TBIJ broke just hours later, with the Abramovich story following early Wednesday morning.

Same goal

UEFA, European football’s governing body, told Euronews it shared the objective of tackling financial crime and protecting the integrity of the game — but urged the EU not to rush headlong into regulation.

“EU policy makers should appropriately engage with football stakeholders in assessing impacts and developing policy options that meet our shared objectives,” a UEFA spokesperson said in an emailed statement, warning that poorly drafted laws could pose “unintended consequences across Europe’s diverse football landscape.”

That may borrow from the experience of Belgium — which passed new AML rules for football after a 2018 scandal dubbed “Operation Zero”, which saw prosecutors probing allegedly suspect financial transactions raiding clubs including Anderlecht, Bruges and Standard de Liège.

The Belgian regime offers a cautionary tale, Euronews was told by Niels Appermont, an associate professor at Hasselt University.

“The existing framework doesn’t really correspond very well with the business of professional football,” Appermont said — as the rules are designed for banks not sport.

While anti-money laundering rules require checks on their “customers,” it’s not always clear what that means for — say — an incoming player transfer, nor how potentially lengthy vetting procedures fit into the tight timelines of a transfer window, Appermont said.

William Bull, an assistant professor at Maastricht University who, alongside Appermont, co-wrote a UEFA-funded 2022 study into the Belgian law, acknowledged issues in the football market — but questioned whether AML rules are the right way forward.

In the football sector, “everyone seems to be pretty much agreed that there’s a problem in terms of transparency, credibility, concerns about various covert dealings or payments through agents,” Bull said, but added that the “the jury’s still very much out” about whether existing financial-sector regimes are cost effective.

Chelsea did not immediately respond to Euronews’ request for comment, but in a statement provided to TBIJ said that the allegations pre-dated the club’s current ownership, and that the club had reported potentially incomplete financial reporting to football regulators. Representatives of Abramovich, who was forced to sell Chelsea last year after being sanctioned for his connections to Russian President Vladimir Putin, did not return requests for comment, TBIJ said.