Austin Jack Warner, Member of Parliament for Chaguanas West, failed to disclose the US$10 million he pocketed in 2010 in a hallmark self-dealing transaction involving his private offshore company, J&D International, and the Caribbean Football Union (CFU), of which he was president and which up until May last year was not a legal entity.
Continuing Sunday Express investigations reveal that the former football jefe failed to disclose tens of millions of US dollars of income from the sale of Caribbean media broadcast rights to International Media Content Ltd, which operates SportsMax cable channel, for several World Cup tournaments, including the 2010 edition in South Africa.
The hallmark Warner deal saw the sale of World Cup television rights for the Caribbean region brokered through his private Cayman company, J&D International, and another Warner shell creation trading as the CFU.
The rich backroom deal was brokered in 2001 in a bid to silence critics in Zurich about what former general secretary of the Federation Internationale de Football Association (FIFA), Michel Zen-Ruffinen, had described as “self-serving transactions” and the “raw pursuit of personal profit”.
Warner, a former executive committee (ExCo) member of the world football governing body, used his FIFA connections and close relationship with FIFA president Sepp Blatter to wrest ownership rights of the 2002 World Cup from key rival Caribbean Satellite Television Network (CSTN).
In an elaborate scheme to channel the TV rights in Warner’s direction, FIFA’s marketing partner, Kirch Media, created what was alleged to be a false claim to terminate its legal contract with CSTN—now the subject of a legal dispute with FIFA.
The backroom heist gave Warner control of Caribbean TV rights for several World Cup tournaments for a mere US$1, but sharp criticism from FIFA ExCo members, Lennart Johannasson and Zen-Ruffinen, forced Warner to relinquish the rights to the regional football body CFU.
But in a classic behind-the-scenes himself-to-himself deal, Warner, on December 10, 2001, sold the rights held by his Cayman company to the paper CFU company, of which he had complete control, for US$4.2 million.
Warner signed on behalf of J&D International and Harold Taylor, a long-time Warner aide, signed as an authorised CFU official.
Esther Dubarry, one of Warner’s secretaries of long standing and corporate secretary to several of his private corporations, signed as a witness to the agreement.
FIFA told the world that the award of the lucrative television rights was intended “to provide an additional source of revenue for football development in the CFU”.
The TV rights and the money flows from it went instead to Warner’s offshore company, according to FIFA insiders.
In the layered transaction, the Cayman company sold the rights to the CFU and privately negotiated the CFU TV rights sale to MCL SportsMax for some US$6 million.
Persons with knowledge of the situation told the Sunday Express that the broadcast income stayed with Warner’s Cayman company.
The CFU, the regional football body which was registered as a not-for-profit organisation in May 2012 in Jamaica, operated throughout its more than 20-year-old history at a loss. Insiders report the football body saw little, if any, of the TV rights money and to this day is yet to get any information—including financial records and bank statements—from its former president and/or its chief accountant and auditor Kenny Rampersad, Warner’s main man of business.
Sources say the Cayman company negotiated and retained a reported US$8 million paid by MCL SportsMax for the 2006 World Cup tournament and another US$10 million for the 2010 edition, income that Warner failed to disclose to the Board of Inland Revenue (BIR).
As reported last week, Warner has been operating outside this country’s tax laws for more than a decade and has failed to file corporation tax returns for any of his registrable interests disclosed in his statements of return to the Integrity Commission.
Other payments made to the Cayman-registered J&D International by businessman and United National Congress (UNC) financier Krishna Lalla were also not disclosed to the local tax collection agency.
Persons with knowledge of the situation say Warner received five payments totaling US$800,000 from Lalla over a four-month period in 2007, the same year he became a public official and subject to scrutiny under the Integrity in Public Life Act (IPLA) legislation.
Lalla also made a US$500,000 wire transfer payment to a Warner account at First Citizens Bank, Queen’s Park West, Port of Spain branch.
He paid another $500,000 (part of a $60 million payout) to a private CFU account held at Republic Bank on Tragarete Road in Port of Spain.
CFU insiders say the football body did not see a cent of that money.
The International Court of Arbitration for Sport (CAS), in reviewing the 2011 cash-for-votes affair involving CFU officials, took special note of the secret CFU bank account from which Warner was alleged to have paid his former close pal-turned-whistle blower Chuck Blazer two cheques totaling US$445,000, payments that are engaging the attention of the US Federal Bureau of Investigation (FBI) and US tax authorities, the Internal Revenue Service (IRS).
The majority of the CAS panel found Warner, the main architect of the Port of Spain-arranged CFU summit with then FIFA presidential candidate Mohamed bin Hammam, to be “an unreliable witness” who had a “detached relationship with the truth”.
Former CFU officials say they have no knowledge of any of the transactions hitting the parallel account held at Republic Bank. They also maintain that Warner had complete control of the official US and TT bank accounts held in the name of the football body.
CFU officials say Warner left the regional football body, which has been the beneficiary of substantial financial grants from FIFA, completely broke.
As reported in a previous series, published in this newspaper, the offshore account for J&D International at Fidelity Bank (Cayman) Ltd was set up by Jeffrey Webb, Warner’s successor at CONCACAF and now Blatter’s choice to succeed him as president of FIFA.
—To be continued