Billionaire Frank Lowy says Australia was 'naive' in its World Cup soccer bid

Frank Lowy’s other misstep – at the A-League grand final last month. Picture: Getty Images

Billionaire Frank Lowy is used to doing deals as founder and non-executive chairman of Westfield, a global company controlling $60 billion worth of assets, but five years ago, as chairman of the Football Federation Australia (FFA), he now admits he was “naive” when bidding for the 2022 FIFA World Cup.

With FIFA now in crisis over widespread corruption allegations following an investigation by US authorities, and FIFA president Sepp Blatter resigning just days after the 79-year-old was re-elected for a fifth term – Australia voted for his rival – Lowy has issued a long, detailed letter about the FFA’s taxpayer-funded $46 million World Cup bid in 2010.

Lowy now admits the FFA made mistakes, were naive at times and would do things differently.

He says he’s “nursed a bitter grievance” since Australia received just one vote of support in the 2010 vote, which controversially awarded the 2022 competition to Qatar, sparking widespread accusations of corruptions and a number of investigations which, until the intervention of US law enforcement last week, had failed to find any serious evidence of wrongdoing.

Central to Lowy’s defence of his organisation is the issue of $US500,000 which ended up in the hands of disgraced former FIFA vice president Jack Warner as part of the bid.

Warner was found to have committed fraud and Lowy said the FFA is asking for its money back.

“We ran a clean bid and we are proud of that,” Lowy said.

The statement comes after British journalist Andrew Jennings, who’s been investigating FIFA for the past 12 years, and provided the FBI with documents, called on Lowy to step down as president of the FFA on ABC TV’s Lateline last night, alleging a lack of due diligence during the bid process.

“You can’t have a brilliant businessman like Frank Lowy claiming he didn’t know the money was going to be stolen by Jack Warner,” Jennings said.

“He’s led Australian football into disaster. What he did earlier: well, he is a billionaire and OK, he reorganised the FFA after previous problems, but now he’s got to go.”

“You’ve been shafted in Australia.”

Here is Frank Lowy’s full statement:

Open Letter from FFA Chairman Frank Lowy AC

World football might just be at the dawn of a new era.

Sepp Blatter’s resignation should open the door to major reform. I say should because FIFA’s problems are deep-rooted and tangled in a culture that has developed over decades. It will take a united, concerted effort by its football associations to fix the mess.

Australia has tried its best to work within football forums to promote reform. In 2013 we began work on ideas which would allow FIFA to operate with greater transparency and accountability. Many others in world football have been working on similar projects.

Now, at last, it appears there might be new leadership at FIFA willing to listen to these ideas.

I feel that the past week has been a watershed. The series of events leading up to last week’s dramatic developments and the overall scandal surrounding FIFA left Australia with no option but to vote for change.

On a personal level, since 2 December 2010 when Australia received just one vote in its World Cup bid, I have nursed a bitter grievance.

We ran a clean bid. I know that others did not, and I have shared what I know with the authorities, including Michael Garcia who undertook a 2-year investigation into the 2022 World Cup bid.

But did we make mistakes? Yes. Were we naïve? In some cases, yes. Would we do things differently in future? Absolutely.

The FIFA bid guidelines required us to demonstrate a commitment to international football, particularly through projects in developing countries.

We were playing ‘catch up’ in world football terms. Australia had only begun its reform of football in 2003. We entered the Asian Confederation in 2006. When we launched our bid for 2022 we were not familiar with the powerbrokers in world football.

This led us to recruit, on the advice of FIFA’s leadership, consultants who ultimately proved less than effective to say the least.

It led us to work hard to meet the commitment to development projects.

We gave funds, often in conjunction with Ausaid and the Australian Government, to many countries and football associations.

Sometimes these were football related. We paid for under-17 teams from Laos and Malaysia to travel to Australia for tournaments. We worked with Government to fund the “Just Play” program under the Pacific Sports Partnership. We gave to countries that didn’t have a vote in the World Cup bid, such as Vietnam, the Philippines and East Timor.

Others were humanitarian, such as a donation to help repair damaged football infrastructure after the 2009 earthquakes in Chengdu, China and a hospital in South Africa and desks for African school children.

This was effectively the same approach used to win the bid for the 2000 Olympics, and by government to win a seat on the UN Security Council, and was consistent with what every other bidding nation was doing.

The donation which has received most attention was to CONCACAF – the north and central American football association.

This was to fund a feasibility study to develop its Centre of Excellence in Trinidad & Tobago. The man behind the centre was the President of CONCACAF, Jack Warner, whose reputation as a “colourful character” was well known.

He had been on the FIFA Executive Committee since 1983 and was seen as hugely influential to the World Cup vote.

The centre asked Australia to donate $4 million to the project. We compromised and offered $500,000 to fund a preliminary feasibility study.

We sent a team to examine the site. We engaged an external sports facilities consultant to visit the site and prepare a report. We met with CONCACAF officials to agree the terms.

The Chief Executive of the Centre, not Warner, gave us the bank account details for CONCACAF. We paid the money into that account and received confirmation it was received by the bank. It was paid into a CONCACAF account, not Jack Warner’s personal account.

When CONCACAF contacted us to say they were conducting an inquiry into its accounts, we provided information about our donation.

That inquiry – conducted by 2 former judges and a senior accountant – found that Jack Warner had committed fraud and misappropriated the funds – in other words he had stolen the money from CONCACAF. It also found other instances of wrongdoing by Warner over many years.

That initial inquiry by CONCACAF was taken over by FIFA and Michael Garcia, and again Australia provided information to Garcia. We also became aware that law enforcement authorities in the US were looking into the matter.

We asked CONCACAF to give our money back because it wasn’t used for the purpose we intended, and were advised by FIFA to wait until the inquiries were complete. Those inquiries are still ongoing.

We ran a clean bid and we are proud of that but it wasn’t a level playing field and therefore we didn’t win it. I will always be bitterly disappointed about the outcome.

But since 2 December 2010 Australia has been working behind the scenes to bring about change, and we will continue to do that as FIFA embarks on this new era.

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