August 18, 2015 / 8:04 PM / 4 years ago

U.S. demanded anti-money laundering group delete soccer warning: sources

LONDON/ST. LOUIS (Reuters) - The United States and several other countries forced an international anti-money-laundering organization to withdraw a public warning it issued in June to financial institutions about corruption in soccer, according to two people familiar with the matter.

After the Financial Action Task Force published the warning, some top anti-money laundering compliance officials at large U.S. banks contacted U.S. Treasury delegates to the Paris-based group to express their concerns, one of the sources said. The U.S. delegates then demanded the statement be withdrawn.

Meeting in private, the organization’s steering committee backed the demand, with the U.S. getting the support of delegates from Russia, the UK and France among others, the second source said.

The committee decided to delete the warning from FATF’s website before a full meeting of the organization in Brisbane, Australia in late June, said the second source, who was present at that meeting. But the decision to cancel the notice was never announced publicly, this person said.

“The U.S. FATF delegation had a fit. They told the FATF they were way out of bounds because that statement was just so far beyond any current reasonable boundaries that have been established and agreed upon by FATF members,” the first source said. “The U.S. delegation said: ‘You guys are nuts, that is not the way we’re headed with this stuff.’”

Banks have already begun applying “a tremendous amount of scrutiny to FIFA-related vendor payments and associated individuals,” but even that scrutiny has limits, this source added.

Officials at FATF, an inter-governmental body bringing together anti-money-laundering agencies around the world, did not respond to a detailed email requesting comment.

A Treasury spokesperson did not immediately respond to questions from Reuters.

The warning had been issued in the wake of the indictment by U.S. authorities in late May of nine current and former soccer officials and five business executives on corruption charges, including bribery, money laundering and wire fraud.

It said that financial institutions had not done enough to police suspicious financial activity by officials at FIFA, and had cautioned banks to step up scrutiny of so-called “high-risk” customers.

“In these cases, financial institutions do not appear to have given a sufficient amount of scrutiny to the financial activities of the officials concerned, as many of these allegedly corruption-related transfers passed through the international financial system undetected,” FATF added in the statement that was withdrawn.

Reporting by Mark Hosenball in London and Brett Wolf in St. Louis; Editing by Martin Howell

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