Corruption – University of Pennsylvania Professor P.

Nichols January 2017

Final assignment by Fabrizio Corradini

Match-fixing in Italian football (soccer): the resilient stain

of corruption on the “Beautiful Game”

From the Economist August 20th 2016:

http://www.economist.com/news/europe/21705256-italians-are-not-only-ones-throwing-
matches-you-betcha

From the New York Times June 2nd 2012:

http://www.nytimes.com/2012/06/03/sports/soccer/stain-of-scandal-again-taints-italian-
soccer.html

1. Last Summer saw the recurring tragic replay of match-fixing scandals in Italian
football. At the basis of the widespread cases of corruption revealed by investigators
is a now familiar collusion of opaque club-owners and managers, crooked betters,
match officials, players attracted to (or coerced into) “pay-for-sub-performance”
arrangements, dodgy player management cartels, as well as organised crime. The
latter not only fix results of matches on which they then bet with confidence (betting
is considered an effective means to launder money obtain from other illicit
activities), but also double as effective enforcers of the corrupt arrangements.
Sporting fans, honest club owners and players, as well as legal betters must be able
to place their trust in the fairness of sporting performances. This trust has repeatedly
been betrayed and diverted to the benefit of crooked gamblers and club owners,
who, by offering financial incentives to match officials, players and owners of rival
clubs, orient the results of the matches in their favour. The involvement of organised
crime ensures that financial suasion is often accompanied by very credible threat of
physical coercion. The owner of a mid-league club can be incentivised to give away a
match to a team that is threatened of relegation at the bottom of the league table.
Match referees can be convinced to make deliberately wrong calls (misuse their
power and players to play in low gear, or even commit match-changing fouls or
errors. Players’ careers are to a good degree dependent on the relationships they
have with their respective clubs – who can abuse this power to oblige players to
betray their duty to respect the rules of good sporting behaviour. This power has, in
many cases been compiled by carte-like organizations that acquired a stranglehold
on transfers of players between clubs. Trust placed by honest clubs and players, fans
and sports betters is thus abused for the benefit of a collusion of criminal interests,
who abused that trust, but also the power they hold over players or, in the case of
officials, over the course of matches.

2. The consequences of such criminal activities are broad and deep. At a societal level,
they contribute to undermining the trust in the country’s number one sport and
more broadly of its institutions, in a country already plagued by corruption (it
languishes in 61st place in Transparency International’s corruption perception
 ranking, a steady penultimate among EU countries. Economically, this means less
income from spectators (who increasingly stay at home and prefer to watch foreign
leagues on TV), advertising/sponsors (relational consequences) and TV rights, but
also drop in commitment by volunteers and loss of confirmed talent to other
countries or of potential youth talent to alternative sports (if these are assumed as
being less corrupt). On a more personal level, aside from the formal sanctions
inflicted, which I will discuss below, match fixing corruptions produces a waste of the
key resource of the club – talent. In clubs in which willingness to be corrupted is
important, talent might be trumped by “moral flexibility”. The Italian league, once
arguably the pre-eminent championship in the world, and prime attractor of the best
talent in the sport, has progressively and decisively been surpassed in terms of
economic and sporting performance by other leagues in Europe. In the cases in
which criminal and administrative convictions have been reached, the sanctions
have been heavy. Clubs found guilty have been sentenced to multi-million dollar
fines and their managers have in some cases served time prison. From an
administrative point of view – i.e. the decision of sports authorities – these clubs
have been retroceded to lower leagues or (for offences perceived as minor) had
points deducted in their respective leagues. On an individual referee or player level,
there have been fines and suspended prison sentences, but, perhaps more seriously
for professionally whose playing careers typically span a short 15 years, playing bans
imposed by the sporting federation (bans in Italy apply in other countries as well, by
agreements at the level of the sport’s international federation – FIFA … ironically
plagued by corruption scandals of its own). Level 1 and 2 costs have thus been high,
but, as ever and though less measurable, level 3 costs in terms of reputation and
economic prospects of been much higher.

3. Improving the control of this type of corruption runs parallel to the challenge of
tackling the rampant – and by now highly sophisticated and institutionalised - level
of corruption in the country – which abates by and reinforces the strong presence of
organised crime. Any work on improving the cultural attitudes toward corrupt
behaviour is hence strongly contingent upon improving the overall attitudes in the
country, starting with the leadership of the country. From an institutional
standpoint, and sticking to the chosen case of corruption in football/soccer
(inextricable enough!), the federation should increase transparency in financial
reporting standards by football clubs to clarify sources of income and ownership.
The anti-corruption prosecutors in Italy are actually of very high calibre, and despite
operating in a very hostile environment, have achieved remarkable results. One
could wish to create a specialised section looking into sport corruption at the level of
the newly created anti-corruption agency, which would have to work hand-in-hand
with the sport’s federation. Court and administrative procedures should be
accelerated and potential sanctions be increased to a level that becomes indubitably
dissuasive – both for clubs and players. One would also have to create an easy and
way for people to report suspected corruption in absolute confidence – assorted
with potential for plea-bargain leniency for early effective collaboration to the
inquiries. Clubs should also be obliged to openly communicate – and recognize in no
uncertain terms the misdeeds for which they were found guilty (too often the
sanctions are seen by fans of the indicted club as partisan justice in a system in
 which “everybody does it, but only we get punished due to some obscure plot” – and
clubs often abide in this comforting self-indulgent narrative). These measures ought
to jointly lead to reducing the attractiveness of corruption in this field: higher
probability of getting nabbed and higher price to pay when you do, higher
moral/social/psychological cost by openly admitting to the wrongdoing and, finally,
by making it much more risky/potentially costly for players to engage in the wrong
behaviour, make running these corrupt schemes much more expensive for the
corrupters. From a cultural standpoint, much work needs to be done at the level of
youth players. There is ample evidence that the tendency to “game the system”
while incurring no shame is instilled at a young age among players. This needs to be
addressed. Convicted players should be asked to cooperate in this as part of their
sentences.

4. Corruption in football is clearly but a microcosm of corruption in society at large, and

in a country already plagued by culturally well rooted corruption and powerful
organised crime, it is not surprising to graft manifest itself in sports as well. This has
been compounded by the fact that football as a sport has been itself hit at
international federation level by serious alleged corruption indictments). Recent
decades have seen a vast increase in money flows into the sport – income for which
the institutional body – FIFA - has been – if the allegations are to be believed -
unable and unwilling to ensure ethically proper and transparent management.
Tackling the national problem requires effectively addressing the challenges on both
ends.