Sport

Investigators brought in to probe Mohamed bin Hammam corruption allegations

A former FBI director will assist in the investigation into claims of corruption which led to the suspension of Asian Football Confederation president Mohamed bin Hammam last month.

Associated Press

August 06, 2012

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A former director of the FBI has been brought in to assist the corruption investigation into suspended Asian Football Confederation president Mohamed bin Hammam.

Investigation firm Freeh Group International, founded by former FBI director Louis Freeh, has been appointed to probe allegations he misused AFC funds, along with making payments to football officials in Asia, Africa and the Caribbean.

The allegations were uncovered in an internal audit that resulted in the AFC giving bin Hammam a 30-day provisional ban last month - just days before the Court of Abritration threw out a lifetime ban imposed by FIFA on Bin Hammam for an unrelated bribery case.

AFC acting president Zhang Jilong called on the 46 federations to cooperate with the probe into the 63-year-old Qatari.

"We would like to point out that it is crucial that the Freeh Group receive unconditional and unreserved support and cooperation by all AFC officials, bodies, and Member Associations," Jilong said

"The proceedings presently relevant are not about incriminating or discrediting certain persons but aim at establishing the truth and, on a broader scale, at safeguarding the integrity and interests of football under the AFC's jurisdiction."

The audit, prepared by accountants PricewaterhouseCoopers, alleges he received millions of dollars from individuals linked to AFC contracts during his tenure that dates back to 2002. Bin Hammam is accused of spending $700,000 from AFC coffers on himself and his family, including $100,000 for his wife, $10,000 on a Bvlgari watch for himself and nearly $5,000 for his daughter's cosmetic dentistry.

Payments are alleged to have been made to Asian, African and Caribbean football officials, including $250,000 to Jack Warner, the former longtime head of Caribbean football.

The audit found that a contract for commercial rights with World Sports Group and its subsidiary World Sports Football were no-bid contracts that were "considerably undervalued." Bin Hammam is also accused of approving several lucrative, no-bid contracts for commercial rights, including one for Qatari-owned Al-Jazeera Satellite Network.

The audit said its review of the AFC accounts found that tens of thousands of dollars in cash were routinely given to federation presidents and their relatives. Most of it went into their personal bank accounts and none of it was for football-related expenses, it said.

Bin Hammam has not spoken about the latest allegations, but his lawyer said they are a FIFA tactic to block his return to world football.

Mercer, the investment consulting arm of US services company Marsh & McLennan, expects its wealth division to at least double its assets under management (AUM) in the Middle East as wealth in the region continues to grow despite economic headwinds, a company official said.

Mercer Wealth, which globally has $160 billion in AUM, plans to boost its AUM in the region to $2-$3bn in the next 2-3 years from the present $1bn, said Yasir AbuShaban, a Dubai-based principal with Mercer Wealth.

“Within the next two to three years, we are looking at reaching $2 to $3 billion as a conservative estimate and we do see an opportunity to do so,” said Mr AbuShaban.

Mercer does not directly make investments, but allocates clients’ money they have discretion to, to professional asset managers. They also provide advice to clients.

“We have buying power. We can negotiate on their (client’s) behalf with asset managers to provide them lower fees than they otherwise would have to get on their own,” he added.

Mercer Wealth’s clients include sovereign wealth funds, family offices, and insurance companies among others.

From its office in Dubai, Mercer also looks after Africa, India and Turkey, where they also see opportunity for growth.

Wealth creation in Middle East and Africa (MEA) grew 8.5 per cent to $8.1 trillion last year from $7.5tn in 2015, higher than last year’s global average of 6 per cent and the second-highest growth in a region after Asia-Pacific which grew 9.9 per cent, according to consultancy Boston Consulting Group (BCG). In the region, where wealth grew just 1.9 per cent in 2015 compared with 2014, a pickup in oil prices has helped in wealth generation.

BCG is forecasting MEA wealth will rise to $12tn by 2021, growing at an annual average of 8 per cent.

Drivers of wealth generation in the region will be split evenly between new wealth creation and growth of performance of existing assets, according to BCG.

Another general trend in the region is clients’ looking for a comprehensive approach to investing, according to Mr AbuShaban.

“Institutional investors or some of the families are seeing a slowdown in the available capital they have to invest and in that sense they are looking at optimizing the way they manage their portfolios and making sure they are not investing haphazardly and different parts of their investment are working together,” said Mr AbuShaban.

Some clients also have a higher appetite for risk, given the low interest-rate environment that does not provide enough yield for some institutional investors. These clients are keen to invest in illiquid assets, such as private equity and infrastructure.

“What we have seen is a desire for higher returns in what has been a low-return environment specifically in various fixed income or bonds,” he said.

“In this environment, we have seen a de facto increase in the risk that clients are taking in things like illiquid investments, private equity investments, infrastructure and private debt, those kind of investments were higher illiquidity results in incrementally higher returns.”

The Abu Dhabi Investment Authority, one of the largest sovereign wealth funds, said in its 2016 report that has gradually increased its exposure in direct private equity and private credit transactions, mainly in Asian markets and especially in China and India. The authority’s private equity department focused on structured equities owing to “their defensive characteristics.”