Football Leaks in Cross-Border Legal Battle

In a narrow and stuffy hall of the municipal court in Budapest on Tuesday, Rui Pinto, the 30-year-old Portuguese source of data that fueled the stories for European investigative journalism project Football Leaks, listened to the judge announce that he would be extradited back to Portugal to face charges of cybercrime and blackmail.

Reporters and a TV crew attending the hearing listened to Pinto present his defence for two hours, before Judge Judit Csiszár gave her verdict. Following her decision, Rui was cuffed by two policemen and led from the courtroom, before he stopped in front of the cameras.

“I'm a whistleblower,” Pinto said. “I acted for the public good, so how can they hand me over?” His lawyers are appealing the ruling.

In mid-January, Pinto was arrested in Budapest, where he was living, on a European arrest warrant issued by the Portuguese authorities. He denies the charges against him, and has since fought for his right to be recognised as a whistleblower. Pinto argues that he cannot receive a fair trial in his native Portugal because he has powerful enemies in the country.

Behind this arrest warrant is the global company Doyen and the Arif family, originally from Kazakhstan. In late 2015, Doyen lodged a criminal complaint against Pinto.

Doyen and the Arifs have also began a libel claim in Romania against media website The Black Sea, and obtained a judicial order to force the publication to remove eight stories that mention their company’s dubious history, business and political connections.

This is part of a pattern by the company and family to cleanse the online and public space of any material referring to much of the family’s activities.

In autumn 2015, Pinto was involved in launching the Football Leaks platform that began posting confidential documents exposing the affairs of football clubs, investors and agents. Then, in February, 2016, Pinto agreed to share with Der Spiegel more than 70 million files, which were later available to the European Investigative Collaborations (EIC) network, of which The Black Sea is one of the founding members.

Based on Pinto’s documents, and other research, The Black Sea and its EIC network partners published, over two years, more than 800 stories on the dirty deals in football and the companies and individuals related to the game. The revelations led to criminal investigations and prosecutions for crimes of money laundering, fraud, and tax evasion. One of the most spectacular is the case of Cristiano Ronaldo, who last year admitted to a Spanish court that he failed to pay taxes on €150 million of advertising revenue he received over many years. The multi-millionaire and five-times Ballon D’Or winner ended up with a fine and suspended prison sentence.

EIC partners also exposed the unfair implementation of UEFA’s financial fair play rules and the financial cheating by some of Europe’s biggest clubs. Other stories dealt with controversial Third Party Ownership (TPO) deals, where investment firms control a player’s transfer rights, and the movement of underage players.

The Black Sea published dozens of reports alongside EIC partners, including the dodgy offshore payments of Turkey’s most famous football agent Ahmet Bulut and how Portuguese superagent Jorge Mendes’s hidden deals at Istanbul club Beşiktaş helped destroy the club’s finances, billions of euros illicitly injected into Russian teams by state-owned companies, and Chinese match-fixing networks operating in eastern Europe.

But Football Leaks was not only about football. Pinto’s documents helped reveal a shady multi-million dollar shipping deal of the family of Turkey’s president, which inspired EIC network’s sister project, Malta Files.

Another major focus was the international deals of the Arif family, who were at the time behind Doyen.

Doyen is the brand term for a sprawling network of companies, many of which are registered in tax havens. The principal owners are the Kazakh-born Arif family, formerly known as Arifov. Refik, Rustem, Vakif and Tevfik are brothers who made their wealth in the filthy privatised metals industry after the collapse of the Soviet Union, where Tevfik held a public position as a department head in the Soviet ministry of commerce and trade and Refik at the Industry and Trade department in Kazakhstan.

For over twenty years, hundreds of millions of profits from the family’s Kazakh chrome foundry has fed the Arifs’ diversifying business ventures. When Tevfik moved to Istanbul in the late 1990s, he Turkified his name to Arif and founded construction firm Sembol and hotel business Rixos, which are among the biggest companies in Turkey. Money was also funnelled into their U.S. real estate company Bayrock, which has been accused of fraud and money laundering while it was a partner on Donald Trump’s controversial Trump Soho real estate project in the 2000s.

Bayrock is due to play a role in the ongoing American investigations into the sitting US president. Next week, the US Congress will question Felix Sater, a former associate of the Arifs, who has connections to the Russian mafia.

The Kazakh foundry appears to be the source of the nearly $80 million that funded Doyen’s sports enterprise in management and Third Party Ownership (TPO) – a practice later banned by FIFA. This was the brainchild of Tevfik’s son, Arif Efendi, and Portuguese businessman Nelio Lucas.

Doyen Sport is currently in a fight in the Brussels courts with FIFA, UEFA, and other local football organisations, over sanctions imposed for their apparent violations of the TPO ban, through dealings with third division Belgian side RFC Seraing.

In response to questions by EIC network about Doyen's TPO infractions, a FIFA spokesperson said that the company “cannot be sanctioned by FIFA since they do not fall under the jurisdiction of the FIFA Disciplinary Committee”, but did confirm that “Doyen was involved in several other agreements for which clubs were sanctioned: Sporting Portugal, Sevilla, Seraing and Twente.” On the FC Seraing case, FIFA said that it “has obtained favourable decisions” during the Belgian and EU procedures.

Contained in the original reporting by The Black Sea and EIC network were the family’s professional and personal connections to the so-called ‘Kazakh trio’ of oligarchs Patokh Chodiev, Alexander Mashkevitch and Alijan Ibragimov, whose metals business in Kazakhstan is closely linked to the Arifs’ foundry. They are closely allied on many other investments, including commodities trading. It is these connections the Arfis appear to want to conceal.

The ‘Kazakh Trio’ have been investigated in Great Britain, France, Belgium and Switzerland. Mashkevitch, who is closest to the Arifs, has been described by different media reports as a friend of Kazakhstan president Nursultan Nazarbayev. So close are the apparent ties between them that the Kazakh leader conditioned the purchase of French helicopters from the French state on the lifting of a Belgian prosecution case against the trio, who were on trial for numerous financial offences.

In October last year, a few months before the Hungarian police acted on the Portuguese arrest warrant, Tevfik Arif and Arif Efendi and the Doyen Sport Investment Limited (DSIL), based in Malta, hired the law firm of the former Romanian minister of justice, Valeriu Stoica. The aim was to bring a lawsuit against the Romanian Centre for Investigative Journalism (CRJI) and force the removal of any articles published by The Black Sea that mention the Arif family or Doyen.

None of the parties contacted CRJI, The Black Sea, or any of the reporters involved in the publication, prior to their legal proceedings. The group has now brought two legal actions against CRJI, the first on 21 December 2018, which was a petition to obtain an emergency gag order - known as a 'presidential ordinance' in Romania - to force CRJI to take down the articles on The Black Sea until the defamation case could be held. They also petitioned - without success - to ban The Black Sea from mentioning their names at any time in the future.

CRJI knew nothing of the first complaint, and was unable to defend it in court. So at the end of January this year, Doyen and the Arifs successfully pursued a second order that asked the judge to force the execution of the injunction. Finally, in February, the lawyers emailed a copy of the order to CRJI and The Black Sea journalists.

The substance of the second claim - now being fought by CRJI - deals with disputes over the veracity of the public interest of The Black Sea's reporting and alleges it contains defamatory content. Central to the argument of Doyen and the Arifs is that The Black Sea reporting has no public interest, since, they say, the Arifs hold no public office and Doyen had no business interests in Romania.

Their Romanian lawyers also made a complaint to Google and asked the tech giant to remove links to The Black Sea's stories from the search results. A spokesperson for Doyen made a similar request in March 2018, when one of the company's representatives asked for the removal from the leading search engine of an article by Der Spiegel about the Arif family. Google rejected the claim and stated that the article had “substantial interest to the public”.

The impending extradition of Pinto draws attention to a debate about who can be considered a whistleblower before the law, and what protection they can expect. This was triggered by recent large-scale investigative projects such as LuxLeaks, Panama Papers and Football Leaks which demonstrate that without the help of whistleblowers, the media would struggle to expose activities such as tax fraud and money laundering.

Whistleblowers take on more risks than journalists in leaking information that is in the public interest and face the threat of losing their job and livelihood, prosecution, exile or legal cases that can see them spend years in court.

In spring 2018, the European Commission submitted a draft of a whistleblower directive which defines three reporting channels for anyone wishing to expose sensitive information in the public interest. First, whistleblowers should address the company where they work. If this yields no positive results, they can then turn to the competent authorities. Should this avenue fail, they are permitted to release the information to the public – via the media or through other means. Under the directive, however, only in justified, exceptional cases are sources allowed to contact the media directly and still maintain any whistleblower protection. The European Parliament sees the issue differently and wants whistleblowers to be free to decide which avenue they take.

Rui Pinto is a whistleblower who is not represented in the Brussels draft directive. He did not work for a company or organisation where he revealed questionable practices. His self-stated attempts to clean the world of professional football were obtained from the outside and he has never shown how he obtained the 3.4 terabytes of data which he shared with Der Spiegel.

For investigative journalism, including the type practiced by The Black Sea, the legality of how data is obtained is secondary to the public interest. Similarly, Rui Pinto is an important witness for French prosecutors. In November last year, investigators at the national financial prosecutors Parquet National Financier (PNF) met with Pinto in Paris. The special unit, which deals with serious economic crimes, is now targeting several football clubs and players for financial impropriety. Pinto expressed his willingness to cooperate in return for his entry into a witness protection program.

The French whistleblower regime, which came into force in December 2016, is aimed at whistleblowers who come from a company or organisation. French law provides protection from retaliation, and the French considered Pinto's situation dangerous enough to have him brought to France, which it prepared to do so this February.

Pinto's arrest thwarted their plan. Nevertheless, the French, and prosecutors from other countries, continue to investigate his material. Pinto earlier provided them with twelve million files, about a tenth of what he has in his possession. In mid-February, prosecutors organised a meeting at Eurojust, a cross-border judicial cooperation unit based in The Hague, announcing the plans of nine countries to coordinate in sharing the material delivered by Pinto.

Portugal still insisted on Pinto's extradition. But Antonio Cluny, Portugal’s top Eurojust representative, failed to reveal a potential conflict of interest. His son, João Lima Cluny, is a lawyer at the Portuguese law firm, Morais Leitão, and works in a team that represents football players and clubs. Should prosecutors evaluate that the Football Leaks data contains potential impropriety, it is possible that clients of this firm could come under suspicion.

In the Ronaldo tax case, there is an ongoing investigation against a colleague of João Lima Cluny at Morais Leitão.

Neither the law firm nor Antonio Cluny consider this a conflict of interest. Pinto, on the other hand, claims this is proof that the “football mafia” has “infiltrated” Portugal's judiciary.

The allegations made by the Portuguese authorities against Pinto date back to 2015. Using a false name, Pinto had requested money from the managers of Doyen in exchange for not publishing documents about them. The deal never materialised and Pinto did not collect any money for the documents. Today, he explains that this action was the prank of a stupid boy who wanted to test how much Doyen thought the documents were worth. Nevertheless, this is the source of his legal problems in Portugal.

Investigators at Eurojust are worried that the documents are inadmissible as evidence in the Portuguese courts because of the allegations it was illegally obtained. They fear also that if Portugal takes possession of all of the data, their authorities will not make it available to other law enforcement agencies in Europe. They could also destroy the information.

This could also be a problem for the ongoing investigation into Cristiano Ronaldo’s alleged rape of a woman in a Las Vegas hotel in 2009, which was prompted by Der Spiegel’s reports, and which were based on several key documents from the Football Leaks cache. (Ronaldo rejects the accusation). A representative of the US judiciary also traveled to The Hague for the Eurojust meeting in mid-February.

The documents presented to the court in Budapest by Pinto's defense lawyer also include a letter from a German tax investigation team. At the end of February, the German authorities thanked Pinto in a letter to one of Pinto's attorneys, and suggested a face-to-face meeting. His interest, wrote the tax investigator, is in dealings within the Bundesliga, or, “more generally, German football clubs, players or consultants”. The investigators told Pinto he did not need to bring any documents to the meeting, as his knowledge was of enough interest to them.

This “strictly confidential meeting” would not occur should Pinto be extradited to Portugal.

Doyen's representatives and Nelio Lucas were contacted for this article, but did not reply.

Opening Picture: Maria Feck/Der Spiegel