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Football, Gambling, and Money Laundering pp 143–170Cite as

Proposals to Improve the War Against Money Laundering Through Gambling and Sport/Football

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Abstract

The study concludes by presenting concrete proposals for the public and private sectors in order to prevent and effectively combat money laundering. It also provides specific proposals to combat the novel method of laundering money through sport, football, and gambling.

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Notes

  1. 1.

    Brazil, despite being one of the most populous countries in the world (about 200 million), has a small gaming industry. The industry reached its peak in 2006, when there were over 130,000 machines including slot machines in about 1,500 bingos operating across the country. However, in 2007, many bingos were forced to a standstill and machines were confiscated by the authorities when a federal police operation named “Hurricane” revealed rampant corruption in the industry, with suspected involvement of politicians and organized crime in order to keep them open. Any project aiming to reopen bingos would create a serious risk of money laundering if it is accompanied by a large enforcement structure of regulation and oversight mechanisms sufficient to contain organized crime. No justification, including the allocation of revenue to sports, culture, health, safety, opening new jobs, and investment, would legitimize permission unless crime is able to be contained.

  2. 2.

    According to an article in The Economist, “not all these havens are in sunny climes; indeed not all are technically offshore. Mr Obama likes to cite Ugland House, a building in the Cayman Islands that is officially home to 18,000 companies, as the epitome of a rigged system. But Ugland House is not a patch on Delaware (population 917,092), which is home to 945,000 companies, many of which are dodgy shells. Miami is a massive offshore banking centre, offering depositors from emerging markets the sort of protection from prying eyes that their home countries can no longer get away with. The City of London, which pioneered offshore currency trading in the 1950s, still specialises in helping non-residents get around the rules. British shell companies and limited-liability partnerships regularly crop up in criminal cases. London is no better than the Cayman Islands when it comes to controls against money laundering. Other European Union countries are global hubs for a different sort of tax avoidance: companies divert profits to brass-plate subsidiaries in low-tax Luxembourg, Ireland and the Netherlands.” In The Missing $20 Trillion. How to Stop Companies and People Dodging Tax, in Delaware as well as Grand Cayman. The Economist, Feb. 16, 2013, http://www.economist.com/news/leaders/21571873-how-stop-companies-and-people-dodging-tax-delaware-well-grand-cayman-missing-20.

  3. 3.

    In Direito tributário comparado e tratados internacionais fiscais. Porto Alegre: Sergio Antonio Fabris, 2005, pp. 83–84.

  4. 4.

    Cf. id. pp. 166–70.

  5. 5.

    (d) Entry and Enforcement of Judgment—(1) In general—The district court shall enter such orders as may be necessary to enforce the judgment on behalf of the foreign nation unless the court finds that—(A) the judgment was rendered under a system that provides tribunals or procedures incompatible with the requirements of due process of law; (B) the foreign court lacked personal jurisdiction over the defendant; (C) the foreign court lacked jurisdiction over the subject matter; (D) the foreign nation did not take steps, in accordance with the principles of due process, to give notice of the proceedings to a person with an interest in the property of the proceedings in sufficient time to enable him or her to defend; or (E) the judgment was obtained by fraud. http://www.law.cornell.edu/uscode/text/28/2467.

  6. 6.

    United States v. Opportunity Fund and Tiger Eye Investments, Ltd. No. 1:08-mc-0087-JDB, United States District Court for the District of Columbia. Decided July 16, 2012. . Accessed June 14, 2012.

  7. 7.

    BANA, Anurag. Online Gambling: An Appreciation of Legal Issues. 12 Bus. L. Int’l 335, 2011, p. 342.

  8. 8.

    See, for example, the Resolution by the Brazilian financial intelligence unit, the Council for Financial Activities Control, COAF Resolution No. 10 of November 19, 2001.

  9. 9.

    In Pending U.S. Legislation to Prohibit Offshore Internet Gambling May Proliferate Money Laundering, 10 Law & Bus. Rev. Am. 447, 2004, p. 451.

  10. 10.

    In Brazil, the Internal Revenue Service Regulatory Directive No. 748/RFB of June 28, 2007, does not require offshore accounts or trusts to completely identify stockholders and administrators as is done for companies domiciled in Brazil. All that is required for enrollment in the Corporate Taxpayer Register (CNPJ) is a copy of the company charter. This means they might be satisfied with a simple declaration issued by a tax haven’s public agency (bearing the company name, date chartered, type, purpose, and address).

  11. 11.

    Cf. Terror outfit-turned “charity” JuD set to come under Pak Central Bank scanner. In Asian News International,03/13/2012. www.lexis.com. Accessed June 19, 2012; Naveed Butt. Insurance/takaful companies: SECP enforces compliance with AML Act. The Financial Times Limited. NPO 3/25/2012, 2012 WLNR 6308356.

  12. 12.

    See Prafulla Marpakwar. State forms cells to detect source of terror funds. Times of India. Copyright 2011 Bennett, Coleman & Co. Ltd. December 24, 2011. . Accessed June 19, 2012.

  13. 13.

    Cf. www.charitiesnys.com, or www.chaririesnys.com/pdfs/statute_booklet.pdf. Accessed May 29, 2012.

  14. 14.

    FATF, Vulnerabilities of Casinos and Gaming Sector, March 2009, available at www.fatf-gafi.org/dataoecd/47/49/42458373.pdf.

  15. 15.

    For more on this, see Jesús-María Silva Sánchez (in Eficiência e direito penal.Coleção Estudos de Direito Penal. São Paulo: Manole, 2004, No. 11, p. 11) and Anabela Miranda Rodrigues (in Contributo para a fundamentação de um discurso punitivo em matéria fiscal. Direito Penal Económico e Europeu: textos doutrinários.Coimbra: Coimbra ed., 1999, pp. 484–85).

  16. 16.

    SCHOPPER, Mark D. Internet Gambling, Electronic Cash & Money Laundering: The Unintended Consequences of a Monetary Control Scheme. 5 Chap. L. Rev. 303, 2002, p. 328.

  17. 17.

    In Internet Casinos: A Sure Bet for Money Laundering. 19 Dick. J. Int’l L. 77, 2000–2001, p. 108.

  18. 18.

    In Internet Gambling and the Destabilization of National and International Economies. Time for a Comprehensive ban on Gambling Over the World Wide Web. 80 Denv. U. L. Rev. 111, 2002–2003, p. 119.

  19. 19.

    Ian Abovitz. Why the United States Should Rethink Its Legal Approach to Internet Gambling: A Comparative Analysis of Regulatory Models that Have Been Successfully Implemented in Foreign Jurisdictions. 22 Temp. Int’l & comp. L. J. 437, 2008, p. 468.

  20. 20.

    In Internet Gambling, Electronic Cash & Money Laundering: The Unintended Consequences of a Monetary Control Scheme. 5 Chap. L. Rev. 303 2002, p. 304.

  21. 21.

    FIFA denied Spanish Courts to get a copy of the contract between the Brazilian football player Neymar and Barcelona club (see http://esporte.uol.com.br/futebol/ultimas-noticias/2014/02/05/fifa-se-nega-a-enviar-contrato-de-neymar-para-justica-da-espanha.htm. Accessed Feb. 06, 2014).

  22. 22.

    Andrew Jennings, in: A ginga perfeita dos donos da bola. A FIFA controla o dinheiro, marca os adversários e dribla a Justiça. Entrevista. O Estado de São Paulo, J4, aliás, June 27, 2010.

  23. 23.

    See Humberto Theodoro Júnior. Consumer Rights (Direitos do Consumidor: a busca de um ponto de equilíbrio entre as garantias do Código de Defesa do Consumidor e os princípios gerais do direito civil e do direito processual civil).Rio de Janeiro: Forense, 2009, p. 25.

  24. 24.

    In Professional Football and the Antitrust Laws: Impact of United States Football League V. National Football League and a Proposal for Change. 31 St. Louis U.L.J. 1057, 1986–1987, p. 1058.

  25. 25.

    Cf. JOY, Stephen; WARREN KINDT, John. Internet Gambling and the Destabilization of National and International Economies. Time for a Comprehensive ban on Gambling Over the World Wide Web. 80 Denv. U. L. Rev. 111, 2002–2003, p. 126.

  26. 26.

    In The Unlawful Internet Gambling Enforcement Act: A Bad Gambling Act? You Betcha! 60 Rutgers L. Rev., p. 501.

  27. 27.

    Cf. Blanchiment d’argent: l’autre mercato. Le Monde, published August 8, 2012. In http://www.lemonde.fr/sport/article/2012/08/30/blanchiment-d-argent-l-autre-mercato_1751790_3242.html. Accessed May 6, 2013.

  28. 28.

    See the Brazilian legislation, Estatuto do Torcedor, Law 10.671 of May 15, 2003 and Law 12.299 of July 27, 2010.

  29. 29.

    IRVING, James G. Red Card: The Battle Over European Football’s Transfer System. 56 U. Miami L. Ver. 667, 2001, p. 724.

  30. 30.

    See Article 1691 of the Brazilian Civil Code.

  31. 31.

    Brazilian law, in § 7 of Article 28 of Pelé Law, addresses the issue of sports agents, only prohibiting the granting of proxies to them with a term exceeding 1 year.

  32. 32.

    See Article 217, Part I, of the Brazilian Federal Constitution.

  33. 33.

    South African authorities created 56 Special Courts for the South Africa World Cup (2010), which were imposed by FIFA, and arrested two Dutch women who wore miniskirts with the colors of a competing European Brewery that was not a FIFA sponsor. The women were released only after an out-of-court agreement. See FIFA exigiu mudanças na justiça da África do Sul. Jornal da Globo, June 23, 2010, http://g1.globo.com/jornal-da-globo. Accessed Jan. 28, 2014.

  34. 34.

    Jonathan Magee. When is a Contract More than a Contract? Professional Football Contracts and the Pendulum of Power. 4 ESLJ xxvi, 2006–2007, page 46, April 1, 2013.

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  1. Tribunal Regional Federal 3rd Region, Sao Paulo, Brazil

    Fausto Martin De Sanctis

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De Sanctis, F. (2014). Proposals to Improve the War Against Money Laundering Through Gambling and Sport/Football. In: Football, Gambling, and Money Laundering. Springer, Cham. https://doi.org/10.1007/978-3-319-05609-8_9

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