Private corruption and breach of trust in the commercialisation of media rights by a secretary-general of a sports association

Facts

Parties and procedure:

The Office of the Attorney General of Switzerland (OAG) initiated criminal proceedings on 5 November 2015 against A., secretary-general of the association E. (an international football federation), for breach of trust and, subsidiarily, embezzlement, following a complaint filed by D. AG and subsequently taken over by the OAG. Subsequently, E. also filed a complaint against A. for breach of trust on 25 January 2016. The OAG then informed E. of its right to file a complaint for private corruption (former Art. 4a and 23 UCA) in connection with benefits granted to A. by B. and C.. E. filed a complaint for private corruption on 27 December 2016 and a second one on 2 June 2017, leading to the opening of an investigation against A., B. and C. for private corruption and aggravated breach of trust.

On 30 October 2020, the Criminal Chamber of the Federal Criminal Court rendered a default judgment against C., acquitting A. of the charges of aggravated breach of trust and passive corruption, but convicting him of forgery of documents to a fine of 120 day-fines at 200 CHF per day, suspended for two years. B. was acquitted of instigating aggravated breach of trust, and C. of instigating aggravated breach of trust and active corruption. A. was ordered to repay to E. an amount of 499,242 EUR, plus interest at 5% per annum from 23 September 2020, less 99,468.73 EUR, as well as an amount of 1,250,000 EUR, plus interest at 5% per annum from the same date.

On 23 June 2022 (supplemented on 9 June 2023), the Appeal Chamber of the Federal Criminal Court ruled on the appeals by the OAG, A. and C., as well as the joined appeal by B. It acquitted A. of the charge of aggravated breach of trust but found him guilty of repeated forgery of documents and repeated passive corruption, sentencing him to an 11-month custodial sentence and a fine of 100 day-fines at 200 CHF per day, suspended for two years. B. was acquitted of instigating aggravated breach of trust, and C. was found guilty of repeated active corruption, sentenced to a 10-month custodial sentence suspended for two years. The Appeal Chamber referred E. to pursue its claims in civil proceedings for the remainder.

Factual background:

Role and functions of A. within E.: A. was the secretary-general of E., one of the most important positions after that of president. He was responsible for preparing the budget, financial statements, accounting management, keeping the accounts, and had decision-making power over financial matters related to project planning, divisional budgets, accounting controlling and compliance with liquidity plans. He prepared the annual and four-year liquidity plans and submitted them to the president for approval. E.’s annual turnover exceeded one billion Swiss francs.

Negotiations and awarding of media rights: Between 2012 and 2015, A. was regularly informed by L., head of the “TV” sub-division of E., about the progress of negotiations with commercial partners, including M.M. Network/N. LangA, E1.E1. SA (managed by C.) and H1.H1. Ltd, for the commercialisation of the media rights for the 2018/2022 and 2026/2030 World Cups. Media rights contracts were considered “major contracts” and had to be approved by the Finance Committee and then by the Executive Committee of E. However, members of these bodies did not receive the contracts or the presentations prepared by the “TV” sub-division before the meetings.

Undue benefits and corruption: Between 2013 and 2015, A. received financial benefits from B. and C., including:

• A first payment of 500,000 EUR on 4 November 2013, credited to the account of J1. Sàrl, a company of which A. was the sole beneficial owner, via I1. CO., a company owned by C.
• A second payment of 500,000 EUR on 13 May 2014, followed by a third of 250,000 EUR on 29 July 2014, also credited to the account of J1. Sàrl.
• A. also benefited from a loan of 500,000 EUR from C., via I1. CO., in May 2014, followed by a second loan of 250,000 EUR in July 2014, without informing E. of these transactions.
• A. used part of these funds to acquire a villa (Villa O.) and a luxury yacht, without having the financial means to do so.

Commercial representation contracts: E. concluded commercial representation contracts with E1.E1. SA and H1.H1. Ltd for the commercialisation of media rights in Greece and Italy. These contracts provided for high commissions for intermediaries, ranging from 12.5% to 33% of the sale price of the media rights. A. played a key role in the conclusion and extension of these contracts, in collaboration with C., without informing E. of the financial benefits he received in return.

Criminal and civil complaints: E. joined the criminal proceedings as a complainant party and also filed civil claims related to the facts of private corruption and breach of trust. The complaints were filed on 27 December 2016 and 2 June 2017.

Appeals: The OAG, A. and C. filed appeals against the Appeal Chamber’s judgment. The OAG sought the annulment of the judgment and the conviction of A. for repeated aggravated breach of trust, as well as custodial sentences for B. and C. A. sought a full acquittal, while C. sought the inadmissibility of the procedural acts or his acquittal for repeated active corruption.

Considerations

On breach of trust (Art. 158 SCC and Art. 321b CO):

The Federal Supreme Court examined whether A.’s violation of his duty to account for and repay undue benefits received (Art. 321b para. 1 CO) could constitute damage within the meaning of Art. 158 para. 1 TSOA. a SCC, in the form of a failure to increase the assets of E. Consistent case law recognises that an employee, like an agent, is subject to a duty of care and loyalty, as well as the duties to account and to repay. However, a mere breach of the duty to repay is not sufficient to constitute the element of damage. It must be shown that, due to the lack of information, the employer was unable to claim restitution of the benefits owed to it by third parties. In other words, the manager must divert benefits that were originally intended for the employer. In the present case, the benefits received by A. were not counter-performance intended for E., but bribes paid by third parties to influence his conduct. These benefits therefore did not form part of E.’s assets over which A. had a duty of management. Consequently, the Appeal Chamber correctly held that the mere breach of the duty to account and to repay was not sufficient to establish damage by failure to increase assets within the meaning of Art. 158 SCC.

On private corruption (Art. 4a and 23 UCA, former law):

The Federal Supreme Court recalled that private corruption, under the former law, is a formal and abstract endangerment offence requiring a triangular relationship between a corruptor (extraneus), a corrupted person (intraneus) and the latter’s “principal”. The constituent elements of the offence are designed symmetrically: active corruption (Art. 4a para. 1 TSOA. a UCA) and passive corruption (Art. 4a para. 1 TSOA. b UCA). The benefit must be undue, i.e. the recipient has no right to it, and it must be provided in exchange for an act or omission contrary to the person’s duties or falling…