Lewis has been a prolific author since leaving Salomon Brothers. He is most famous for Moneyball, his story about the Oakland Athletics that introduced the then-arcane world of statistical analysis to the average baseball fan, and ultimately to the world of sports as a whole. But he always returned to finance. The Big Short described aspects of the 2008 financial collapse in language the average reader could understand. Flash Boys shed light on the systemic corruption of the US stock markets that allows a select group of investors to front-run the rest of us, padding their pockets with our retirement savings.
When Attorney General Loretta Lynch stood before the world and brought the hammer down on the leaders of FIFA, Lewis surely must have looked on with incredulity. After all, the racketeering, money-laundering and wire fraud charges levied against a global assortment of FIFA luminaries was the product of a prosecutor armed with the resources of the FBI slowly working up the chain of command. First they turned American FIFA executive Chuck Blazer, then they followed him around the world, picking up one bad actor after another until the Godfather himself, FIFA President Sepp Blatter stepped aside. Surely if the US Department of Justice and the FBI could bring down FIFA, they could have exacted some degree of retribution from those who brought the world's financial system to it knees.
It is hard for many Americans to grasp what is going on here. First of all, we don’t even call it football like the rest of the world. But more to the point, most of us have never heard of Sepp Blatter, despite his being a global celebrity of sorts. But FIFA is a non-profit organization with $1.5 billion in financial reserves that is largely funded by American money. It is the point of access for advertisers wanting to reach the largest sporting audience in the world, and most of the leading advertisers are American companies. Roger Bennett, a British football journalist whose daily soccer podcast on ESPN, Men in Blazers, is essential listening for this scandal, put it succinctly the other day:
"McDonald's. Budweiser. Visa. Coke. When those massive American-based, global, multi-nationals are embarrassed, and suddenly their brands are linked to corruption, to bribery, to fraud, to the 1,200 deaths of essentially slave workers building the stadiums in Qatar. FIFA had to take action. And that action involves money, because that's the only language that FIFA understands. We've always said it had to be America that took FIFA down."
But really the credit should go to Andrew Jennings, the British journalist whose book Foul!: the Secret World of Fifa; Bribes, Vote Rigging and Ticket Scandals provided a roadmap for the FBI and Lynch to follow. And follow it they did. When Roger Bennett asked why the US Department of Justice was leading the charge against FIFA, ESPN investigative reporter and anchor Bob Ley summed it up: "Because the banking laws of the United States have been trifled with."
Which of course brings it all back to Michael Lewis, who has spent a quarter of a century chronicling nothing if not the trifling with the banking laws of the United States.
I get the din of bribery and corruption that swirls around FIFA. It is what happens when money and power meet. And some of it is simply comical. Jeffrey Webb, one of the indicted co-conspirators accused of taking millions of dollars in bribes in return for his vote as the FIFA delegate from the Cayman Islands describes himself as one of the leading bankers in the Cayman Islands. Really? A Cayman Islands banker? Is that not business card code for money laundering?
And then there is Sepp Blatter himself speaking to students at Oxford two years ago: "Perhaps you think I am a ruthless parasite sucking the lifeblood out of the world and out of football—the Godfather of the FIFA gravy train. There are those who will tell you that FIFA is just a conspiracy, a scam, accountable to nobody. There are those who will tell you of the supposed sordid secrets that lie deep in our Bond villain headquarters in the hills above Zurich." How hard would it be to imagine Blatter's words spoken by Lloyd Blankfein, the CEO of Goldman Sachs, the original "great vampire squid wrapped around the face of humanity, relentlessly jamming its blood funnel into anything that smells like money," as journalist Matt Taibbi suggested, who, like Lewis, must be wondering why the FBI has never called. Lewis, after all, laid out a similar roadmap, providing the names, the dates, the systemic fraud and corruption.
I get that many people find it hard to believe South Africa Sports Minister Fikile Mbalula when he denies that the six million dollars that South Africa paid to Jeffrey Webb and several others was a bribe to secure their support for South Africa’s bid for the 2010 World Cup. But many people also find it hard to believe that bankers Lewis described in The Big Short who deliberately designed securities to fail before selling them to clients did not similarly commit some manner of indictable offense. And many other people find it hard to believe that when the New York Stock Exchange sold access to hedge funds that enabled them to front-run average investors, none of those officials went to jail either.
Attorney General Loretta Lynch and her FBI colleagues have done their job. They have painstakingly followed the roadmap from the bottom of a corrupt global conspiracy to the top. That is a good thing. It is only their choice of which corrupt global conspiracy to tackle that seems curious.
Goldman Sachs—and I am only using Goldman as a metaphor for Wall Street—never bribed Jeffrey Webb, or at least I am not aware of any allegation that they did. But Goldman Sachs has put its money to good use, and perhaps better use than the FIFA leadership. Over the past decade, Goldman Sachs—once again, Goldman is just shorthand for the entire financial services industry—paid out almost six billion dollars in political contributions to members of the US Congress over the past decade. Those contributions were surely made with some idea of what was expected in return, and to ensure that their interests were represented at the highest levels of the US government.
Blatter has offered the typical CEO defense of the bribery and corruption rife within his organization. "I can't monitor everyone all of the time." But then he went further and suggested a credo that we have never heard from the leaders of our own banking industry in the wake of one scandal after another, one multi-billion fine after another. "We cannot allow the reputation of football and FIFA to be dragged through the mud any longer. It has to stop here and now." And then he did what no one did in the wake of the global financial collapse. He resigned.
The prosecution of FIFA came about because a journalist laid out a roadmap, and a prosecutor and the FBI picked up that roadmap and chose to follow it. The determination that Atttorney General Lynch has shown in her pursuit of wrongdoing at FIFA raises the question of why misdeeds on Wall Street were never pursued with similar zeal. Perhaps the roadmap that Michael Lewis laid out is not as compelling, or perhaps the culprits on Wall Street were simply better at playing the game and covering their tracks. Two years ago, Sepp Blatter described FIFA to students at Oxford as a conspiracy, a scam, accountable to nobody, words that many might apply to what Wall Street has become. It is all well and good that the US Justice Department has decided to police the rest of the world; it does beg the question as to why they have not been playing the same role here at home.