When you think of an Olympic host, what comes to mind? Do you think or the controversy-ridden Sochi 2014 Winter Olympics, with allegations of c

THE OLYMPIC BRIBERY SCANDAL

By Dr Bill Mallon

U ntil 24 November 1998, all seemed to be well at the IOC headquarters along the shores of Lake Geneva. There had been few recent political problems, revenues from fund-raising and television were at all-time highs, and the most recent Olympic Games had been highly successful.

But on that day the Salt Lake City (Utah) television station, KTVX, reported that the Salt Lake Olympic Organizing Committee for the Olympic Winter Games of 2002 (SLOC) had been paying for Sonia Essomba to attend American University in Washington.1,2,5,11,17 The announcement by itself

seemed innocent enough, but it had far reaching repercussions, and what eventually transpired threatened the entire existence of the International Olympic Committee.

Sonia Essomba was the daughter of René Essomba, the late IOC member (1978-98) to Cameroon. The payments, it would be revealed, were part of a larger scheme set up by SLOC to award scholarships to the family members and friends of IOC members in an effort to win their votes to become the Host City The scholarship program had its start when Salt Lake City was bidding to win the 2002 Olympic Winter Games. Within a few days after the revelation of the Essomba “scholarship” the media reported that, beginning in 1991, shortly after Salt Lake City had lost the 1998 Winter Olympic bid to Nagano, 13 individuals had received scholarship assistance worth almost $400,000 from the Salt Lake Bid Committee or SLOC. Of these 13 individuals, at least six were close relatives of IOC Members.4

The International Olympic Committee Executive Board had a scheduled meeting in Lausanne shortly after these announcements. But even before that meeting, on 1 December, IOC President Juan Antonio Samaranch requested the IOC Juridical Commission to review the issue of the alleged scholarship. The Executive Board meeting began on 12 December 1998, but at the close of the meeting, Swiss IOC Member Marc Hodler spoke openly to the press, stating that at least 5-7% of IOC members had taken or solicited bribes by bid cities. He described corruption in the bidding system and stated that agents existed who, for a significant price, would attempt to deliver IOC votes to the various cities bidding for the Olympic Games and Olympic Winter Games.11

Within a few days, all manner of revelations were published by the media, which descended like sharks on a feeding frenzy. Among other announcements, Intermountain Health Care in Salt Lake City announced that it had provided free medical care to three people connected to an IOC member, which amounted to $28,000 worth of care for hepatitis, cosmetic surgery, and a total knee replacement. On 16 December, Salt Lake City mayor Deedee Corradini said that the city had hired the son of IOC Member David Sibandze as an intern. Bruce Baird, formerly the leader of the Sydney 2000 bid for the Olympic Games, announced that he had been approached by a non-IOC member who stated that, for the right price, he could deliver African IOC votes.1,2,4,5,11,17

Shortly before Hodler’s interview. upon the recommendation of the Juridical Commission, Samaranch had already formed an ad hoc commission to look into the allegations and accusations made against the host cities and bid cities.11 Canada’s Dick Pound was named to head the inquiry, usually called the Pound Commission.11 But Samaranch himself did not escape unscathed, when the press published reports in early January 1999 that he had been given expensive guns as gifts from Salt Lake City. Samaranch noted, however, that he had not kept the gifts for himself but had donated them to the Olympic Museum.2,17

Salt Lake City was not the only bid or Host City involved in the bribery scandal and efforts to investigate the Nagano bid committee began in earnest, as those Games had just ended in February 1998. It was reported in the Japanese media that the Nagano bid committee spent an average of $22,000 on 62 visiting IOC members. But further investigational efforts were forestalled when it was discovered that Nagano had destroyed all the records of their bid committee. If they had a smoking gun, it had been put out. Samaranch attempted to elicit information on other bid committees by writing to each bid committee or relevant National Olympic Committee going back to 1990, and requesting evidence of IOC Member wrongdoing2,17

At the beginning of 1999, investigating the IOC and the bid city process seemed to be all the rage. In addition to the Pound commission, the SLOC formed its own Board of Ethics to investigate its own practices. The United States Olympic Committee (USOC) also formed a panel to investigate the IOC, its administrative processes, and the selection of Olympic host cities. Headed by the former U.S. Senator from Maine, George Mitchell, its formal title was the Special Bid Oversight Commission of the United States Olympic Committee, but this group became known as the Mitchell Commission. Concurrently, the FBI (Federal Bureau of Investigation) began its own inquiry into the SLOC to determine if any federal laws were violated relating to bribery and the Foreign Corrupt Practices Act. Of note, only the Pound Commission actually interviewed the IOC Members under investigation, allowing them a chance to answer the charges before them.

New announcements from Salt Lake City appeared in the press almost daily in January 1999. On 7 January the Associated Press reported that IOC Member Jean-Claude Ganga of the Republic of the Congo had earned a $60,000 profit on a land deal arranged by a member of SLOC.2 On the same day, the first ripples that Salt Lake City and the Olympic Movement might be hit in the pocket book appeared when US West Airline, a major sponsor of the 2002 Olympic Winter Games, said it would withhold $5 million in payments until SLOC could answer question’s about the allegations.2 Shortly thereafter, David F. D’Alessandro, President of John Hancock Financial Services announced that, until the IOC cleaned up its act, his company would withhold payments to the

Olympic Movement,

On 8 January 1999, the President and CEO of SLOC, G. Frank Joklik, resigned, as did his Senior Vice-President, Dave Johnson.15 Joklik gave a press

conference at which be made the following

statements:

1. have an announcement to make that saddens me greatly. For the better part of the last decade, I have been intensely involved, along with some of the finest people I know, in bringing the 2002 Olympic Winter Games to Salt Lake City. This has been a tremendously successful effort so far and will be the most successful Olympic Games in history. I plan to help make it so.
2. the last six weeks I have been deeply dismayed by the facts that have come forth concerning behaviour by certain individuals acting for the Bid Committee during the process of winning the right to stage the Games. I have been reluctant to comment or take any action with regard to these charges because of my deep concern that we should be sure before we speak or act.”

After Joklik described some of the transgressions of the bid committee and SLOC, he said, “Therefore, I have today obtained the resignation of David Johnson, who was a vice-president of the Bid Committee, and has been acting as Senior Vice-President of the Organizing Committee until today. I have recommended the appointment of a new Chief Operating Officer. The other two principal members of the Bid Committee, Tom Welch, who was Chief Executive Officer and Craig Peterson, who was the Chief Administrative Officer, are no longer employees of the corporation. … Finally, to ensure that the Games go immediately forward, I must take steps of my own. Although I had no knowledge of these improper payments during my tenure as the volunteer Chairman of the Board of Trustees of the Bid Committee, in order to assure the people of Salt Lake City, the State of Utah, and the world that the Organizing Committee is distinct from the bid committee and is off to a fresh start, I have tendered my resignation today.”15

Tom Welch was the main impetus behind the Salt Lake City bid to host the 2002 Winter Olympics. Though no longer in an administrative position with SLOC, he was on their payroll as a consultant when the scandal hit. Joklik stated that Welch’s consulting agreement was terminated as of his announcement.15 Over the next few months, Welch was a marked man, and a reclusive one, who made no public statements but spoke only through his lawyers. He has been a figure in the FBI investigation of the Salt Lake Bid Committee (SLBC), and his lawyer, Tom Schaffer, revealed later in 1999 that Welch denied any wrongdoing, but the Associated Press reported that he would consider testifying against members of the IOC in exchange for immunity from prosecution.16

On 14 January 1999 USOC official Alfredo La Mont resigned amidst allegations that he had worked with SLOC to secure information concerning Latin American IOC Members. The next day, Samaranch called for an extraordinary IOC Session to be held in Lausanne on 17-18 March, but he also stated that he

would not resign, despite frequent calls in the media for him to do so. One break for SLOC occurred at this time as US West gave the committee the promised $5 million which it had been holding until all information was available.1,2,3,17

On 19 January Finnish IOC Member Pirjo Häggmann resigned. She was one of the first two female members of the IOC, having served since 1981. But her “crime” was that her ex-husband had

worked for the Salt Lake City bid committee and had also worked for the Toronto Bid Committee when that city bid to host the 1996 Olympics.1,2,5,17

The second IOC member to resign was the Libyan, Bashir Mohamed Attarabulsi, who did so on 22 January. It was revealed that his son had attended an English language center at Brigham Young University in Salt Lake City, with tuition paid by SLOC and the son was provided with $700/month by the organizing

committee.1,2,5,17

The Sydney bid for the 2000 Olympics, to this time, had been relatively unscathed. But on the same day that Attarabulsi resigned, John Coates, who had headed the Sydney bid, admitted that he had made last-minute offers of $70,000 to two African IOC officials, but said the action was legitimate.1,2,5,17

The IOC was once broke,

investigations continued into the status of three other

and it was only in the 1980s members – Korea’s Kim Un-

Yong, Russia’s Vitaly

that it began to achieve Smirnov, and Louis

Guirandou-N’Diaye of Côte d’Ivoire. Dutch member

financial independence. But

Anton Geesink, a former gold medalist in judo, had

all this happened quickly, too

been investigated, but was exonerated, and given only a

quickly for the IOC to adjust.

warning.14

On 23 January, the IOC Executive Board met in Lausanne to discuss the preliminary findings of the Pound Commission and make some early decisions. At the end of the meeting, Samaranch announced that the IOC had made mistakes, that they were responsible, and that it must never happen again. Six IOC Members were suspended, pending the final Pound Report, with a vote to be taken on their possible expulsion at the special IOC Session in March.

The six IOC Members suspended (and eventually expelled) were Lamine Keita of Mali, Agustin Arroyo of Ecuador, Charles Mukora of Kenya, Zein El-Abdin Mohamed Ahmed Abdel Gadir of the Sudan, Sergio Santander Fantini of Chile, and the aforementioned Jean-Claude Ganga. A third member resigned voluntarily, David Sibandze of Swaziland, while

Then came the reports. The first commission to formally issue its findings was the Board of Ethics of the Salt Lake Organizing Committee for the Olympic Winter Games of 2002. This was a five-member commission chaired by The Honorable Gordon R. Hall, former Chief Justice of the Utah Supreme Court. Their report was issued to the SLOC Board of Trustees on 8 February 1999.4 It was scathing.

It began by noting that the Board of Ethics had been formed on 10 April 1997 but the SLOC had asked it in December to expand its role in response to “certain allegations of wrongdoing or improper activity … during the bid effort.” The SLOC Executive Committee had asked the Board of Ethics “to conduct an independent and thorough investigation …” This investigation stated that Salt Lake City believed that it had lost the bid for the 1998 Winter

JOURNAL OF OLYMPIC HISTORY -MAY 2000 13

Olympics to Nagano because of the extreme measures taken by the Nagano bid committee to “befriend” IOC Members. Of note, shortly before the IOC Meeting at which Nagano was chosen, Japanese companies made large donations, possibly in excess of $15 million, to the IOC Museum in Lausanne. It should be noted, however, that Olympic Winter Games in Salt Lake City in 1998 would have followed the Olympic Games in Atlanta in 1996, and the IOC no longer usually awards both Games consecutively to the same nation.

With this in mind, the Salt Lake City bid committee, led by Tom Welch, revealed its new mission statement in October 1991. The mission for International Relations was to “plan and implement a campaign to secure the winning number of IOC member votes for Salt Lake City in Budapest in 1995.”4 To that end, the following goals, among others, were established:

. ‘Establish and maintain long-term, vote influencing relationships with IOC members.

. Establish and maintain long-term relationships with other key people of the Olympic Family. A key person is one who would influence an IOC member’s vote.

. Establish and maintain long-term, vote influencing relationships with the USOC.4

The Board of Ethics report then described a litany of indiscretions by the bid committee and SLOG. These included:

. Bid and organizing committee payments to Sibo Sibandze, son of Swaziland IOC Member David Sibandze, totalling $111,389.12, ending in October 1996.4

. The existence of the “scholarships program” which assisted family members or friends of IOC Members with payments to universities or other educational opportunities.4

. The employment of John Kim, son of IOC Member Kim Un-Yong, by Keystone Corporation, after Tom Welch had interceded on his behalf. Keystone was reimbursed the full costs of John Kim’s employment, estimated to be between $75,000 and $100,000. (The Pound Report later noted”… the Commission considers that there was an arrangement between SLBC [Salt Lake Bid Committee] and Keystone under which SLBC was

reimbursing Keystone for John Kim’s salary.“)

. Payment of living expenses in Salt Lake City from June 1992 to 1995, totalling nearly $21,000, for Nancy Rignault Arroyo, daughter of IOC Member Agustin Arroyo. (The Pound Report later estimated these benefits at $10,468.83.)

. Payments to consultants whose primary responsibility seemed to be to facilitate introductions between IOC Members and bid committee members. These consultants and their payments are listed as follows in the report: Mahmoud El-Farnawani, a consultant based in Toronto specializing on IOC Members from the Mediterranean region, was paid $148,260 over three years; Muttaleb Ahmad, Director-General of the Olympic Council of Asia, was paid $62,400 from June 1994-June 1995; “Citius” – a consulting contract which was traced back to an association with Alfredo La Mont, USOC Director of International Relations and Protocol, and which was paid $25,714.35 between March 1990 and May 1991; ARCA – another entity affiliated with Alfredo La Mont, which was paid $18,185.90; and the earlier described association with Bjarne Häggmann, husband of Pirjo Häggmann.4

. Payment of rent, tuition, and expenses for Sonia Essomba, which began the scandal’s revelations, to the tune of $108,350.4

The Board of Ethics did not stop with the above, and it noted that “Many witnesses before the Board of Ethics described Mr. [Jean-Claude] Ganga as the IOC member who most took advantage of the Bid Committee’s and the community’s generosity.” The report noted that Ganga visited Salt Lake City on six occasions. During those visits he was treated for hepatitis, his mother-in-law underwent total knee replacement surgery, and his wife bad cosmetic surgery, all on the dole of the Salt Lake City bid committee. It was estimated that travel expenses for Mr. Ganga and his family alone exceeded $115,000.4

In addition, the report stated, “There is no personal relationship between a Bid Committee official and an IOC member that appears more improper than the business dealings between Mr. Welch and Mr. Ganga.” Specifically, in May 1994, Welch and Ganga formed a partnership called “Claudet Investments,” whose purpose was listed as to “invest in real and personal property.“ Ganga was also assisted by SLOC Trustee Bennie Smith, Jr. in the purchase of land in the Ogden, Utah area, with Ganga realizing a profit of $60,000, when the land was quickly re-sold. There were also unexplained direct payments from the bid committee to Ganga totalling $70,010.4

The Board of Ethics report revealed further payments. Charles Mukora, the Kenyan IOC Member was paid $34,650 directly, purportedly for a Kenyan NOC program. Sergio Santander Fantini, Chilean IOC Member and President of the Chilean NOC, was paid directly and it is noted that, “both checks, totalling $20,050, lack proper documentation.” Further direct payments were requested from one of the consultants, Muttaleb Ahmad, to Zema Gadir, who was said to be the daughter of the Sudanese IOC Member, General Zein El-Abdin Mohamed Ahmed Abdel Gadir. But it was discovered that General Abdel Gadir has no daughter. (Note Abdel Gadir’s initials – Z.E.M.A. Abdel Gadir!)4

And so it went, through 57 pages of revelations of various indiscretions. The Board of Ethics Report concluded with nine recommendations, as follows:

1. The IOC should promulgate and enforce rules governing interactions between bid cities and IOC members.
2. The IOC should require bid cities to file periodic reports detailing all expenditures on behalf of IOC members.
3. The IOC and the USOC should prohibit bid cities from participating in NOC assistance or Olympic Solidarity programs during the bid process.
4. The USOC should promulgate and enforce rules governing interactions between U.S. bid cities, the USOC and the IOC.
5. SLOC should monitor the ongoing efforts of the IOC and the USOC to promulgate rules governing interactions with IOC members, and should establish supplementary policies as necessary.
6. SLOC should create an ombudsman position to provide an avenue for employees to communicate their concerns to the Board of Trustees.
7. SLOC should seek Board of Ethics review prior to making decisions that raise ethical concerns.

1. SLOC’s Executive Committee should conduct semiannual reviews of all material expenditures by SLOC.
2. SLOC should undertake a thorough review of its policies to ensure that appropriate direction is given to management and the Board of Trustees in conducting their business.4

The IOC could barely catch its breath over these revelations when the Mitchell Commission released its report on 1 March 1999.19 The Mitchell Commission did note that its sources were documents from SLOC and the USOC, as well as media reports. It did not interview IOC Members under investigation nor did it review IOC documents. It interviewed the two IOC Members to the United States, Anita DeFrantz and James Easton, as well as Frank Joklik. It was unable to interview Tom Welch and Alfredo LaMont, both of whom declined interview requests upon advice of counsel.

The Mitchell Report was more encompassing, dealing with several arms of the Olympic Movement. It looked at the bidding process, the IOC structure, and the USOC itself. Its 50 pages of documentation ended with seven pages of conclusions and recommendations.19 However, these were summarized early in the document as follows:

In our report, we make a Series of recommendations. principal among them are:

1. Bid cities should be prohibited from giving to members of the USOC or the IOC anything more than nominal value, and from directly paying the expenses of members of the USOC or IOC. Travel to bid cities and other expenses should be paid out of a central fund administered by the USOC in the selection of a United States candidate city, and out of a central fund administered by the IOC in the selection of a host city.19
2. The USOC must strengthen its oversight of the site selection process by:

a.	establishing an independent Office of Bid Complaints;
b.	prohibiting bid and candidate cities from having or participating in any international assistance
	program;

1. strictly applying the criteria for the award and administration of its International Assistance Fund; and
2. strengthening its Bid Procedures Manual and its Candidate City Agreement.19

3. The IOC must make fundamental structural changes to increase its accountability to the Olympic Movement and to the public:

1. substantial majority of its members should be elected by the National Olympic Committees for the country of which they are citizens, by the International Federations, and by other constituent organizations. The athlete members should be chosen by athletes. There should be members from the public sector who best represent the interests of the public.
2. its members and leaders should be subject to periodic re-election with appropriate term limits;
3. its financial records should be audited by an independent firm, and the results of the audit disclosed publicly, at least yearly; and
4. appropriate gift giving rules, and strict travel and expense rules should be adopted and vigorously enforced.19

4. The USOC should request the President of the United States to consider, in consultation with other governments, naming the IOC a “public international organization” within the meaning of the Foreign Corrupt Practices Act, as amended.19

But the Mitchell Commission, unlike the Pound Commission for the IOC, the Board of Ethics Commission for SLOC, and the FBI investigation, had no real power, and had primarily only a consultative role. But the IOC was listening.

An important recommendation made by the Mitchell Commission was to have the IOC and USOC “take the necessary steps to designate the IOC as a ‘public international organization’ pursuant to the OECD’s [Organization for Economic Cooperation and Development] Recommendation on Combating Bribery in International Transactions, and pursuant to the Foreign Corrupt Practices Act.” The IOC attempted to do this but in early December 1999, Donald J. Johnson of the OECD replied, “The IOC does not correspond to the definition of a public international organization in the meaning of Article I, Paragraph 4 of the convention, and that, as a result, its members could not be regarded as foreign public officials in the meaning of the convention. … I have asked the secretariat, in the context of this work, to put to the working group the idea of the convention possibly covering the officials of non-governmental international organizations such as the IOC.”26

In April U.S. Congressman Henry A. Waxman (D-California) introduced legislation to prohibit American corporations, including the television networks, from providing any financial support to the IOC until it instituted the reforms recommended by the Mitchell Commission. He later noted in House Subcommittee testimony that “It was a tough bill, a controversial one, but a necessary piece of legislation. It was also a bill with bipartisan support from members with very different political views.”26

The next published report after the Mitchell Report was the Sheridan Report, produced by Mr. Tom A. Sheridan, former Auditor General for Australia.18 Entitled Examination for SOCOG: Review of Records of the Sydney Olympics 2000 Bid Ltd by Independent Examiner, the report was produced in conjunction with Deloitte Touche Tohmatsu (auditors) and Clayton Utz (lawyers). Sheridan’s report investigated only the Sydney bid for the 2000 Olympic Games. Although it reached a number of conclusions, Sheridan was very careful not to make unwarranted assumptions. He noted, “I am reporting factual material which has not been tested and the accuracy and correctness of which has not been evaluated. Affected persons have not, in most cases, had an opportunity to comment or to rebut the material.” We stated further, “It is important to note that my powers in obtaining evidence outside the Bid Company records were limited to the co-operation

that individuals or organisations saw fit to provide.”

This is a problem inherent in most of the reports, as

their commissions do not have subpoena power, nor

can they act with policing authority to investigate

crimes.18

A much milder report than either the Mitchell or the Salt Lake City report, the Sheridan Report was criticized in the Australian media as being too “kind” to the Sydney bid committee. But Sheridan did point out several instances in which he considered either the bid committee or IOC Members to have breached the standards of conduct outlined by the IOC. Among other items, he reported that:

.

There were several breaches of guidelines related to gift giving to IOC members, in excess of the $200 (US) limit.18

. Two IOC Members had trips to European sporting events paid for by the Sydney Bid Committee, outside of IOC guidelines – Niels HØlst-SØrensen (DEN) and his wife attended the 1993 French Open tennis final; and Kevin O’Flanagan (IRL) and his brother attended the 1992 Wimbledon tennis final both on the Sydney Bid Committee tab.18

. Several visits to IOC members in other nations made by Sydney Bid CEO Rod McGeoch were breaches of IOC guidelines. These national visits were noted to be to Mongolia, Brazil, Argentina, Venezuela, Mexico, and India.18

. Although not considered by Sheridan as a strict breach of IOC guidelines, he stated that the Sydney Bid Committee employed two professional lobbyists – Mahmoud El-Farnawarni and Gabor Komyathy – whose charge was to travel extensively, visit IOC Members, and lobby them on Sydney’s behalf. They were paid AUD $180,000 and AUD $200,000 respectively.18

. There were few apparent breaches of the guideline relating to IOC Member trips to visit Sydney.18

The IOC extraordinary session was planned for 17-18 March. Before this meeting the Executive Board met again and Dick Pound released the “Second Report of the IOC ad hoc Commission to Investigate the Conduct of Certain IOC Members and to Consider Possible Changes in the Procedures for the Allocation of the Games of the Olympiad and the Olympic Winter Games.”14

The Pound Report began with a short description of the conclusions of the Board of Ethics Report and the Mitchell Report. It then made its final recommendations near the beginning of the document, although these recommendations were supported by almost 50 pages of documentation describing the transgressions of certain IOC Members14

The report recommended expelling six IOC members: Agustin Arroyo, Zein El-Abdin Mohamed Ahmed Abdel Gadir, Jean-Claude Ganga, Lamine Keita, and Sergio Santander Fantini, who were all mentioned in the preliminary Pound Report, and Paul Wallwork of Samoa. Charles Mukora, whose expulsion had been recommended earlier, had since resigned.14

Nine IOC members had been investigated, but were given only warnings with no recommendations of expulsion: Phillip Coles of Australia, Louis Guirandou-N’Diaye of Côte d’Ivoire, Willi Kaltschmitt Lujan of Guatemala, Kim Un-Yong of Korea, Shagdarjav Magvan of Mongolia, Anani Matthia of Togo, Vitaly Smirnov of Russia, and Mohamed Zerguini of Algeria. Three members had been investigated, but it was recommended that they should be fully exonerated of the allegations made against them, as follows: Henry Edmund Olufemi Adefope of Nigeria, Ashwini Kumar of India, and Ram Ruhee of Mauritius. Austin Sealy of Barbados was originally given a warning but was later fully exonerated.14

After describing its recommendations concerning the IOC Members, the Pound Report made several conclusions. It noted that the IOC must take action to correct the problems within its membership, and it must implement reforms to be certain these problems could never occur again. The Commission also noted that the IOC should have done more to avoid the problems concer

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