New law a game-changer for sport executives based in Switzerland

Swiss lawmakers have passed a bill that would subject sports officials – such as the head of Fifa, and the International Olympic Committee – to more financial scrutiny by banks in Switzerland.

Switzerland is responding to years of corruption allegations with a set of laws that have become known as “Lex Fifa”, which aim to tighten oversight of the approximately 60 sporting bodies based here.

Swiss lawmakers voted 128 to 62 in favour of revising a broader bill designed to fight money laundering, based on guidelines set up by the intergovernmental Financial Action Task Force (FATF).

Politically exposed persons

The bill now includes wording saying Fifa head Sepp Blatter and other sports executives, such as International Olympic Committee president Thomas Bach, should be treated as "politically exposed persons" – a term justice officials use to define those in positions that could be abused to launder money.

Bach, who pushed through sweeping reforms of Olympic bidding, said he welcomed the measures “wholeheartedly.”

The IOC will audit its accounts to higher standards than legally required of the organization and will provide a yearly finance report, including the allowance policy for all IOC members, Bach said.

Fifa said it supports government efforts to tackle corruption but didn’t comment specifically on the bill, which now goes to the Swiss government to be written into law.

The bill increases financial scrutiny of sports officials by necessity, because Switzerland’s banks are legally required to ensure funds are not of suspicious origin before they accept them.

Money-laundering

The broader money-laundering guidelines aim to keep Switzerland, which is effectively doing away with banking secrecy, off FATF blacklists.

Global corruption watchdog Transparency International welcomed the bill’s passage. But it said Switzerland should go a step further and make private corruption a criminal offense, to give prosecutors more leeway to crack down on wrong-doing in sport.

Sports bodies such as the IOC and Fifa enjoy a privileged existence in Switzerland. As non-profit associations, they pay a far lower tax bill than private-sector corporations.