Germany’s 2006 World Cup controversy: suspicious payments and tax evasion charges

Lea Hogg March 5, 2024

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Germany’s 2006 World Cup controversy: suspicious payments and tax evasion charges

The trial of three former senior football officials has reopened the controversy over how Germany secured FIFA’s support to host the 2006 World Cup, known as the Sommerm?rchen, or summer fairy tale.

The case focuses on suspicious payments involving the late football star Franz Beckenbauer, the late former Adidas boss Robert Louis-Dreyfus, a Qatari former FIFA official Mohammed bin Hammam, and the German Football Association (DFB). The defendants in the case are former DFB presidents Theo Zwanziger and Wolfgang Niersbach, as well as former treasurer Horst Schmidt. They are charged with aggravated tax evasion and could face up to 10 years in jail if found guilty. However, their lawyers have argued that the charges are baseless.

Suspicious payments

In 2002, Beckenbauer, (pictured above), a celebrated defender who won the World Cup for Germany both as a player and coach, took a private loan of 10 million Swiss francs from French businessman Louis-Dreyfus. This money was then wired to a Qatar-based company owned by a FIFA official who cast a vote in the selection of the 2006 World Cup host nation, which Germany won in 2000 with a majority of one. Three years later, the DFB repaid the loan to Dreyfus on Beckenbauer’s behalf, channelling the €6.7 million through FIFA to mask the real nature of the transaction.

This suspicious payment was uncovered almost a decade later, triggering corruption investigations at the DFB, FIFA, and a Swiss criminal court, all of which ended inconclusively. The Tax Evasion Charges Frankfurt prosecutors have focused on the tax implications of the DFB payment to Dreyfus. They argue that the football association wrongly treated the payment as a business expense and hence illicitly claimed tax relief on it. They allege that the DFB conspired with a FIFA official to conceal that the football association was covering Beckenbauer’s private debt, wiring the money through FIFA, which transferred it to Dreyfus. The trial is expected to shed more light on the suspicious payments and the alleged tax evasion. It is a significant development in the ongoing investigation into corruption in football, particularly in relation to the hosting of the World Cup.

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