Blog dedicated primarily to randomly selected news items; comments reflecting personal perceptions

Saturday, March 19, 2016

All Is Not Necessarily Fair in Sport-League Corruption

"Whenever I see the words 'commitment fees', 'commitment bonuses', 'access fees', 'access bonuses', that for me raises a red flag. It's language used to dress up bribes traditionally.
John Githongo, Kenya anti-corruption leader

"Because of Nike's secretive meetings with the top three A.K. [Athletics Kenya] officials, it is my opinion that Nike officials have always been aware that the payments in question are improper."
Affidavit, former Nike administrative assistant

"[Bribery, embezzlement and] unsavoury, improper business practices [are common in sports federations]."
"I hear it all the time from sporting officials. To survive in this world, these are the rules of the game."
Roger Pielke Jr., University of Colorado
David Rudisha (photo: EPA/IAN LANGSDON)
Current 800m world record holder Rudisha

Blowing the whistle on malpractice is always fraught with controversy, denials on the one hand, accusations on the other with each side having its share of champions. And the one who blows the whistle is never very popular with either. A disaffected former employee of Athletics Kenya, a 10-year administrative assistant, has unleashed a storm of offence and defence in a major sport scandal in Kenya, a country well mired in corruption, like most African countries.

It is generally agreed that Kenya produces the world's best competitive runners, although Jamaica claims that place for its runners. Champions of any sport irresistibly draw the attention of commercial interests. What greater impressive public relations advertising could make for a happy marriage between a celebrity and a seller of a product than having a world-renowned sport-footwear producer sign a contract with a country's sport federation whose runners are recognized as the best?
Wilson Kipsang of Kenya hoisted his country's flag after winning the New York City Marathon on Sunday. Kipsang won in an unofficial time of 2 hours, 10 minutes, 59 seconds.
Wilson Kipsang of Kenya hoisted his country's flag after winning the New York City Marathon in 2014.  Kipsang won in an unofficial time of 2 hours, 10 minutes, 59 seconds.   Craig Ruttle/AP

Nike Inc. that had privilege. And when a Chinese clothing company offered sponsorship of Kenya's runners Nike blanched considerably. Leading to a 2009 contract where an agreement to pay hundreds of thousands in honorariums and a 'commitment bonus' of a half-million to sweeten the deal led Kenyan federation officials to view Nike most favourably again. The whistle-blower was blunt; this was a bribe, unsurprisingly.

The Chinese Li-Ning Company had offered only $200,000 as a bribe, and Nike proved it could do so much better. The new contract with Nike was negotiated where the agreement to pay Athletics Kenya an annual sponsorship fee of $1.3-million to $1.5-million, along with an additional $100,000 honorarium annually and the 'commitment bonus', balanced the scale of corruption completely in Nike's favour, and incidentally avoided a lawsuit where Nike could have claimed no grounds existed for termination.

The pot-sweetener ostensibly to be in support of training and the support of Kenyan athletes who required a financial leg up ended landing in private bank accounts owned by officials, swiftly withdrawn from Athletics Kenya's bank account. As an investigation unfolds and investigators peruse letters, bank records and invoices, all courtesy of the whistle-blower, Nike protests its innocence; pure altruism on its part, those payments meant to benefit Kenyan athletes.

Investigators with Kenya's Directorate of Criminal Investigations repeatedly asked for Nike to provide additional information, but evidently what they ask for is being construed as confidential, therefore a reluctance to divulge based on client-provider confidentiality. "Why was such a huge sum of money paid as commitment? It's only Nike who can tell us", commented one detective.

Nike's twenty year involvement with the national runners' association has meant that millions of dollars have passed hands to ensure that Kenyan runners wear Nike's swoosh-brand. And since Kenyans hold world records in the 800 meters, 1,000 meters, 3,000 meters, 20,000 meters, 25,000 meters, 30,000 meters, half-marathon, marathon, it naturally follows that without Nike's signature product they would be incapable of producing such sterling results.

It hasn't sat well with Kenyan athletes to learn that hundreds of thousands of dollars that could and should have been disposed honestly and fairly to give needed financial aid to impoverished Kenyan athletes were taken instead by the privileged authorities in Kenya's sport federation. Which led to a Nairobi protest at Athletics Kenya headquarters.

The investigation revealed that the organization's chairman, Isaiah Kiplagat had requested that Nike wire the bonus to his personal account, but was refused. Regardless, within days the $500,000 had been withdrawn by top officials with Athletics Kenya, as revealed by bank records. Mr. Kiplagat and two other officials deny that did anything that could be construed as ethically questionable, let alone criminal.

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