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(Bloomberg) -- The former heads of Brazil’s soccer federation and South American soccer were convicted of accepting millions of dollars in bribes from sports-marketing companies for the media and marketing rights to professional tournaments, in a setback for organizers of the world’s most popular sport.

The U.S. verdict came in the first case to go to trial in a corruption crackdown that began with a predawn raid at a luxury hotel in Zurich in 2015. The convictions follow guilty pleas from 24 people tied to FIFA, international soccer’s governing association. Fifteen others who’ve been charged are fighting extradition to the U.S.

Juan Angel Napout, 59, a Paraguayan who was president of CONMEBOL, South American soccer’s governing body, and Jose Maria Marin, 85, the former head of Brazil’s soccer federation, were convicted by a federal jury in Brooklyn, New York. Jurors couldn’t reach a verdict Friday on Manuel Burga, 60, a Peruvian soccer official, and will return next week to continue deliberating.

Napout and Marin were found guilty of wire fraud and racketeering conspiracies and immediately jailed by U.S. District Judge Pamela Chen. Marin, who had been residing in a $3.5 million apartment in New York’s Trump Tower, was also convicted of a money laundering conspiracy. The pair were acquitted of some counts.

"The defendants at this point have every reason to flee, now that they’ve heard the verdict,” Chen said.

Under federal sentencing guidelines, the two likely face at least 10 years in prison, she said.

Prosecutors called almost 30 witnesses over six weeks, including former sports-marketing executives who gave jurors an inside look into FIFA’s seamier side. They said that from 2010 until 2016 Napout accepted at least $10.5 million in payoffs, Burga got $4.4 million and Marin collected $6.6 million. Jurors began their deliberations a week ago.

Secret Soccer Recordings Show Bribes Reaped Profit, Payoffs

Alejandro Burzaco, the government’s star witness and chief of sports-marketing company Torneos y Competencias SA, told jurors he paid at least 30 people more than $160 million to secure broadcasting rights to South American tournaments and World Cup matches in 2026 and 2030. A former Citigroup Inc. banker who recalled facts and conversations in precise detail, Burzaco testified that the defendants were among at least six soccer officials who accepted payoffs.

Sports-marketing mogul Jose Hawilla, the founder of Traffic Sports International Inc. who was caught lying to the U.S. in 2013, agreed to secretly record conversations for the Federal Bureau of Investigation for more than a year. Hawilla described paying bribes to multiple officials, dating to the 1990s.

In one 2014 recording, Burzaco and two other marketing executives gloated about making $100 million from the sale of broadcasting rights to a 2016 tournament in the U.S. after paying bribes. “There will be payoffs forever," the executive proclaimed.

Marin later joined the conversation and told Hawilla, "It’s about time to have it coming our way."

Hawilla and Burzaco have pleaded guilty. Hawilla agreed to forfeit $151 million, and Burzaco and his firm will forfeit more than $110 million.

Whether Soccer or Football, U.S. Calls The Business a Crime

The U.S. case was also a paper-trail whodunit, with jurors shown thousands of pages of financial records that prosecutor Sam Nitze said showed how millions of dollars were funneled from sports-marketing companies to offshore banks and shell corporations, as far away as Polynesia, eventually ending up in entities controlled by the defendants or surrogates. 

Thousands of transactions passed through American financial institutions including Morgan Stanley and Citigroup in New York, while some secret recordings were made at New York’s LaGuardia Airport and in Brooklyn. One 2016 tournament involving teams from the Americas was hosted by the U.S.

Prosecutors said it was the big money in international soccer that fueled the fraud. FIFA made more than $700 million from the sale of broadcasting rights to the 2014 World Cup, while the organization’s revenue from 2011 to 2014 was in the billions of dollars, a witness said. Burzaco also implicated some of the world’s biggest broadcasters -- including Brazil’s Globo, Mexico’s Grupo Televisa SAB and a division of 21st Century Fox Inc. -- with having paid bribes to win TV rights. The broadcasters denied the allegations.

Defense lawyers assailed the credibility of Burzaco and Hawilla, saying they were lying to avoid prison. A lawyer for Burga insisted said the purported payoffs never reached him. Marin’s lawyer argued his client was a wealthy man who didn’t need bribe money, while Napout’s defense was that if any payoffs were made, they went to another soccer boss.

Jurors may be more receptive to arguments by Burga’s defense. While Burzaco said Burga got more than $3 million in bribes, evidence kept in a ledger by sports-marketing officials showed that Burga hadn’t received the cash. Prosecutors said Burga, knowing he was under investigation in Peru, told bribe-payers to hold onto his money and pay him later.

The case is U.S. v. Napout, 15-cr-252, U.S. District Court, Eastern District of New York (Brooklyn).

(Updates with defendants’ jailing.)

To contact the reporters on this story: Patricia Hurtado in Federal Court in Manhattan at pathurtado@bloomberg.net, Christie Smythe in Brooklyn at csmythe1@bloomberg.net.

To contact the editors responsible for this story: David Glovin at dglovin@bloomberg.net, Joe Schneider

©2017 Bloomberg L.P.

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