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How The Olympics Were Bought

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ROBERT SULLIVANJune 16, 1995: it's announced that Salt Lake City has won the right to host the 2002 Olympic Winter Games. Grumbling from press row. Trouble ahead, says a grizzled veteran of the Games with a sigh. Mormon morals--that'll bring 'em down.Yeah, says his buddy. I hear the bars close at 11! How can you hold an Olympics in such circumstances?What wasn't presaged by even the most knowing, most inside, most keen-nosed Olympics hound was that, more than three years before any torch lighting, the head of the Salt Lake Organizing Committee--a fine Mormon he was--would be brought down by a spousal-abuse charge, and his successor and possibly as many as 16 members of the lordly International Olympic Committee would fall in a huge, ever-widening bribery scandal. On Friday the whirlwind swept up Sydney as well, after the head of the Australian Olympic Committee admitted paying two African delegates $35,000 each on the night before the International Olympic Committee awarded the city the 2000 Summer Games--by two votes. Salt Lake City wanted to hot up its image for the Olympics, and today it has no worries in that regard.On other matters--whether it can put together an untainted administration to oversee the Games, whether it can raise enough money to support the Games, whether its reputation as an oasis of virtue in a desert of iniquity is forever forfeit--Salt Lake has nothing but woe. We are stunned and bruised, said Utah Governor Mike Leavitt, who along with Salt Lake mayor Deedee Corradini controlled appointments to the S.L.O.C.'s board of trustees. This does not represent the values of this community.After the instinct to lament passed, the instinct to point fingers took over. We revolt at being associated with them, Leavitt said of a Salt Lake bid committee that had, in the years preceding the I.O.C.'s vote on the 2002 site, crossed the palms of I.O.C. members with silver, scholarships for their kids, fancy guns, cowboy hats, skis and other booty that reportedly included call girls. While acknowledging bribery, Leavitt also implied extortion, by way of a sinister and dark corner of corruption. Robert Garff, a local car dealer and now, gamely, third at bat as S.L.O.C. czar, said, I can't say our hands are clean, but the system has been flawed for years. So in some sense we're victims. Of whom? Fingers pointed at an I.O.C. that allegedly demands favors for favoritism.Who's to blame is being sorted out by six separate investigations--the S.L.O.C.'s own; the U.S. Olympic Committee's, chaired by former Senator George Mitchell; the Justice Department's, which includes U.S. Customs agents looking into whether Olympic staffers illegally transported large sums of money outside the country during the bidding process; the Utah Attorney General's; a U.S. House of Representatives inquiry into whether laws prohibiting the bribing of foreign officials have been broken; and the I.O.C.'s, which had Olympic officials around the world on tenterhooks last week. Those findings--prepared by I.O.C. vice president Dick Pound--were to be released over the weekend. On Thursday Pound claimed to have solid, irrefutable evidence that at least a dozen I.O.C. members or their relatives received cash, gifts or donations directly or indirectly from Salt Lake bidders, in many cases more than $100,000 each. Already one delegate--Finnish ex-sprinter Pirjo Haeggman--had resigned after it was revealed that her ex-husband had received jobs in Toronto and Salt Lake City while both cities were vying for Olympic Games. And another--Libyan delegate Bashir Mohamed Attarabulsi--also stepped down after admitting that his son had received tuition and $700 per month in expenses from the S.L.O.C. Before the I.O.C.'s fraught weekend meeting, Pound himself was openly wishing that other delegates would follow their lead.PAGE 1  |    |    |    |  
 
It's doubtful the disclosures will be enough to deprive either Salt Lake City or Sydney of the Games or to topple the autocratic--some say dictatorial--18-year regime of I.O.C. head Juan Antonio Samaranch. But the investigation has already exposed several ugly truths about Samaranch's so-called Olympic family: that the leaders of the S.L.O.C. are not saints, that Samaranch is either delusionary or hypocritical to a Clintonesque degree and that the relationship between the Olympic movement and potential host cities involves good measures of fear and loathing--fear that the money will go away, loathing for the other guy's values.All the problems began in America--not in Salt Lake, but in Los Angeles. The 1976 Montreal Games had dutifully lost millions of dollars, and the 1980 Moscow Games, boycotted by the U.S., didn't make a ruble. The Winter Games, always staged in nice little picture-perfect villages, had seldom turned a profit. Naturally, therefore, no sane city wanted to play host to the Games. Then in 1984, Peter Ueberroth and his Los Angeles organizing committee put on a splashy, TV-friendly, penny-squeezing Olympics that netted $220 million. Suddenly suitors were turning handsprings before the I.O.C., each performing citius, altius, fortius than the last. Two cities had asked for the '84 Games, but in 1985 a dozen came begging for the '92 Winter Games, and six vied for the summer events. What they were willing to do, and what it all might lead to, was evident from the get-go. Brisbane flew lobsters, kiwi fruit and its mayor from Australia to East Berlin for a 1985 I.O.C. meeting, then hired hotel staff from across the Wall to cater. The lunch tab was $1.9 million. Sofia's bidders, who had put out a meager $50,000 buffet, trudged glumly back to Bulgaria. The committee responsible for Amsterdam's bid has been accused of offering prostitutes, video equipment and diamond brooches to I.O.C. members and their spouses. (As if even Brisbane had a chance! The competition that season included Barcelona, Samaranch's hometown. Guess who won.)The great skier Jean-Claude Killy had earlier helped France's Albertville secure the '88 Winter Games. He remembers how quickly things were evolving: We didn't offer trips and lodging. We gave them little gifts, souvenirs like Savoyard knives and pens. Then the stakes became much more considerable.Salt Lake City learned, painfully, how the game was changing. In 1984 and '85, Mayor Ted Wilson oversaw Salt Lake's effort to become America's bid city (the U.S. Olympic Committee designates one town to be the U.S. contender before the I.O.C. picks a winner). The two finalists were Salt Lake and Anchorage, which frankly didn't have a snowball's chance of being chosen by the I.O.C. We did very little entertaining because we had been told not even to contact U.S.O.C. members, Wilson recalls. So we go to Indianapolis in June of 1985, and we lose. He was baffled. Anchorage is dark, doesn't have any venues, doesn't have nearly the culture we do. Back in Salt Lake, Wilson started hearing about fishing trips to Alaska by U.S.O.C. delegates, hunting trips, helicopter rides. Whether those were rumors or not, we said, 'We screwed up. Anchorage schmoozed and we lost. Next round, we're going to schmooze big time.' Anchorage, meanwhile, learned that courting the U.S.O.C. was kiss-on-the-cheek stuff compared to a tango with the I.O.C. Rick Nerland, an advertising executive who served as the Anchorage bid's executive vice president, has said that he was approached twice by agents who asked up to $30,000 for a bloc of I.O.C. votes. I was disappointed that the person was intimating that that went on, he said. We dismissed it on the spot. Also resistant were officials from Toronto and Amsterdam, who reported similar shakedowns in the 1980s, as well as a Swedish hospitality hostess who alleged that she had been asked to have sex with an I.O.C. member--for the good of her country.  |  2  |    |    |  
 
Not everyone said no, and soon reports were rife in the Olympic community of five-star boondoggles and outright fraud. You just weren't a self-respecting I.O.C. member if you didn't demand first-class travel. You were something of a boob if you didn't cash in those tickets, buy economy and keep the change. Where once Killy gave out pens, suitor cities now offered furs, jewelry and fine wines. Robert Helmick, a former I.O.C. member and U.S.O.C. president, remembers keepsakes suddenly escalating from nice things to exorbitant things. At I.O.C. confabs, members were seen rolling dollies laden with gifts to their hotel rooms; at one meeting a makeshift parcel-post office was set up to wrap and ship souvenirs to delegates' homes. Helmick's wife surveyed the scene and termed it legal bribery. Helmick told Time that his wife saw I.O.C. delegates from the East bloc returning from shopping trips with bid officials, laden with Escada clothing and other $500 purchases. The I.O.C. could no longer claim such solicitation was just rumor. In 1986 the committee put a $150 limit on gifts and insisted that travel tickets be nonrefundable.This slowed the flow of largesse not even a little. Former New South Wales Olympics Minister Bruce Baird, one of the men behind Sydney's successful bid for the 2000 Summer Games, complained recently that Australia had to spend over $18 million and three years sucking up to the I.O.C., whose jet-setting, gourmand members all seem to know the word lobster. But the revelation on Friday that Australian Olympic Committee president John Coates had donated $70,000 to Olympic committees in Kenya and Uganda provided the first concrete evidence of possible malfeasance--and threatened to derail Sydney's preparations for the Games. (Before Friday's revelation, Beijing, the other prime contender for the 2000 Olympics, had remained typically silent about the ongoing scandal, although many of its tactics at the time--sweeping the capital clean of mental patients and other undesirables before an I.O.C. visit, and releasing and re-arresting dissident Wei Jingsheng just before and just after China lost its bid--have also drawn heavy criticism.)The situation reached its nadir during the bidding for last year's Winter Games, won by Nagano. By 1991 Salt Lake City, always a suitable site and now represented by a savvy bid team, had grown to be an odds-on choice. But Yoshiaki Tsutsumi, then one of the world's richest men, had a dream: an Olympics in Nagano. When I speak, 100 politicians jump was his calling card. When he said he wanted to be president of Japan's Olympic committee, that group said sure. When he said he wanted to bring the Olympics to Nagano, many said, But we've got no facilities. We've got lousy snow. Are you kidding?Tsutsumi doesn't kid. He met with Samaranch at a Tokyo hotel and discussed the I.O.C. head's pet project: an Olympic museum on the banks of Lake Geneva in Lausanne. Tsutsumi lined up 19 Japanese corporations, and together they contributed $20 million to build Samaranch's hall of fame. (The three other nations that hosted Games during construction of the museum--South Korea, the United States and Spain--reportedly ponied up an additional $16.5 million.) Tsutsumi was awarded the Gold Olympic Order, and Nagano was eventually awarded the Games, by four votes out of 88 total. On the U.S. television show 60 Minutes, Helmick said of the Tsutsumi tsunami: There's nothing wrong with Japanese industrialists donating millions of dollars to Samaranch's project. There is something wrong with Samaranch or someone else on the I.O.C.--and I'm not saying it happened--turning around and voting for Nagano because of it. Samaranch, as is his habit, said money spent to lure the Olympics had nothing to do with him: Nobody's pushing them to spend this fortune or not to spend this fortune.Kim Warren, an official of the Salt Lake Olympic bid committee in 1990 and '91, doesn't let Samaranch off so lightly. He had to fly in on a private jet. He had to stay in the presidential suite--it had to be the finest room in the city. There was a particular type of NordicTrak he works out on, so we had to get that piece of equipment. We had to have limousines for him--Lincoln Town Cars weren't good enough. That was the example he set. Yet as Warren implies, Salt Lake City played along. The bid committee found the limos and the NordicTrak. It arranged for the room.  |    |  3  |    |  
 
And it lost out again. So it upped the ante once more. Past officials of Salt Lake's 2002 bid committee now admit that the munificence extended toward I.O.C. members in the form of contributions, scholarships and health care was worth hundreds of thousands of dollars. Furthermore, the Salt Lake Tribune reported that the committee spent nearly $10,000 on six shotguns and rifles that went to Olympic officials, including Samaranch. (The president says that was O.K. because he doesn't vote for the host city. But even Pound has said Samaranch possesses the loudest nonvote anyone can imagine.) Now an internal ethics panel of the S.L.O.C. is investigating allegations of prostitution, including whether some committee members' credit cards were used to pay for escort services for visiting I.O.C. members.The former S.L.O.C. and bid-team members who have admitted to the payments have had a harder time admitting to wrongdoing. Thomas Welch, the leader of the bid and organizing committees who resigned after pleading no contest to a spousal-abuse charge in 1997, told the Salt Lake Tribune that he and other boosters did nothing wrong in their pursuit of Olympic glory. Never, not once in all that time, seven years, did an I.O.C. member offer a vote for money, he insisted. I never offered anything to get anyone to vote for us ... If you measure our conduct the way people in this city do business, it's no different. You support your friends and their causes, and that's what we tried to do.Such logic no longer flies, however. Hard questions are being asked by those who stand to lose almost as much as Salt Lake if this mess isn't cleaned up. If I were a corporate sponsor, I'd want this resolved quickly, says Salt Lake City councilwoman Deeda Seed. Rest assured: the sponsors want it resolved more quickly than that. US West briefly withheld a payment of $5 million to the S.L.O.C., and if the committee is unable to raise $242 million more in the next year, it will face a shortfall on its $1.4 billion budget.The Olympic movement has a trillion minor and a dozen major sponsors worldwide. The big guns include Coca-Cola, Visa, IBM and Time Inc. Each sponsor kicks in approximately $50 million over a four-year period for the festoon--the right to use the Olympic rings in corporate promotions. Then there is NBC, which has paid $3.5 billion for the rights to all five Winter and Summer Games between 2000 and 2008. A spot poll by Time indicates that none of them is amused. David D'Allessandro, president of John Hancock Mutual Life Insurance, a company with festoon privileges, warned recently that the I.O.C. must conduct an earnest investigation of the malfeasance--and not just in Utah--as well as a thorough purge. If they fail to do that and something else comes up, the rings won't be tarnished, they'll be broken, he said. If they attempt to simply line up 12 I.O.C. members and shoot them and think they can go back to Switzerland, they're wrong. Boardrooms will shake if this is mishandled.Already at least two Salt Lake sponsorships--each reportedly worth more than $25 million--have been postponed until the probes are complete. In Australia, Texaco-Caltex has withdrawn from a $6.3 million deal to sponsor the Sydney Games. D'Allessandro expects future sponsorship deals with the I.O.C. to contain some sort of morals clause, which will be particularly galling to an organization that has made a tough-cop reputation by busting teenagers for taking the wrong nasal spray before the 400-m backstroke.  |    |    |  4  |  
 
While Salt Lake City has subjected itself to the lash with puritanical zeal, the I.O.C. has been slow to drop its defensive posture. Asked by Time about his group's investigation, Samaranch said, Let's not forget that it was just a handful of individuals who acted improperly. Pound, however, has pushed to extend the I.O.C. probe to cover bids for several earlier Olympics, and has suggested several possible reforms that could very well revamp the entire bidding process, reducing I.O.C. members to a largely advisory role and restricting actual decision-making to the I.O.C. executive committee. But even he notes that as early as 1991 Samaranch ignored complaints from the S.L.O.C. of bribe demands, and many other voices insist that only the longtime leader's ouster will prompt a true housecleaning.The I.O.C. under Samaranch avoids trouble until someone says it is trouble. He doesn't care much, for example, for America's many rules. When U.S. track star Butch Reynolds, despite having failed a doping test, obtained a Supreme Court order allowing him to compete in the 1992 U.S. Olympic trials, Samaranch considered requiring athletes to waive their right to sue the I.O.C. in doping cases. (The idea could never have worked in a democracy, and it was abandoned.) When Samaranch wasn't happy with his own testimony in the 60 Minutes story on Nagano, particularly the part about being proud of past associations with the Fascist regime of Spain's Franco, he sought, in vain, to have his interview retaped. And now this: six investigations, at least three of them criminal ones, digging into the I.O.C.'s long-standing tradition of gift giving.Certainly Samaranch wishes this never had happened. But whom does he blame?Ex-S.L.O.C. bid committee officials admit awarding $393,000 in scholarships and stipends to 13 people, six of them relatives of I.O.C. members, and soliciting $28,000 in health care for three committeemen. The specific allegations against seven I.O.C. members:EcuadorAgustin ArroyoI.O.C. member since 1968; also a former private secretary to the President of Ecuador.
• His stepdaughter Nancy briefly worked for the Utah State government and the Salt Lake City Olympic bid committee. According to ex-S.L.O.C. chief Tom Welch, she also received the committee's help while attending a school in Texas.LibyaB.M. AttarabulsiI.O.C. member since 1977.
• His son Suhel received tuition, plus expenses, at Utah schools, including Brigham Young University.
• I consider this humanitarian aid, says Mahmoud El Farnawani, a family friend and Salt Lake consultant. He says Suhel was about to be drafted into the Libyan army and his father wanted him out.CongoJ. Claude GangaPresident, Association of National Olympic Committees of Africa.
• Reportedly accepted $70,000 for children's charities.
• Made $60,000 profit on a Utah land deal arranged by Salt Lake Olympic committees.
• I have done nothing wrong, he told French radio. I will not become rich because I voted for Salt Lake City.NetherlandsAnthonius GeesinkOlympic judo gold medalist in 1964.
• Friends of I.O.C. Member Anton Geesink, a foundation set up to finance his activities, received $5,000.
• The money, he says, funds a mobile academy that tours the world to spread the spirit of the Olympics.
• Dutch Olympic Committee calls the academy murky.FinlandPirjo HaeggmanMiddle-distance runner in three Olympics; member of Finland's Olympic Committee.
• According to the New York Times, ex-husband Bjarne worked for the S.L.O.C. bid committee. USA Today says he also held a government job in Toronto when that city was bidding for the 1996 Games.
• She denied wrongdoing, but quit last week.ChileSergio SantanderI.O.C. member since 1992; president of the Chilean Olympic Committee.
• Thomas Welch, former head of the S.L.O.C., says he gave Santander $10,000 to finance his re-election campaign for mayor of Santiago, the Chilean capital.
• Santander has denied asking for or receiving the money from Welch and the S.L.O.C.SwazilandDavid S. SibandzeActive in Swazi sports charity circuit; has sought I.O.C. funding for sports-journalism courses in Swaziland; also helped evaluate Rome's bid for the 2004 Olympics.
• His son Sibo, a master's graduate from the University of Utah, got a job with the Salt Lake City economic development office.Reported by Tim Blair and Susan Horsburgh/Sydney, Cathy Booth and Anne Palmer Peterson/Salt Lake City, Robert Kroon/Geneva, Donald Macintyre/Tokyo, Sylvester Monroe/Atlanta, Thomas Sancton/Paris, Mia Turner/Beijing, with other bureaus  |    |    |    |  5
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