Calling Hercules -- What FIFA Needs Is Not a Fixer but a New Broom

LONDON (TheDeal) -- Well done, you American chaps!

We do get a bit defensive when you want to extradite our white-collar criminals, but it really is about time those foreign Johnnies at the Fédération Internationale de Football Association got a good kicking. After all, how can you trust an organization that doesn't even bother to translate its name into English?

Brits from the most storied English schools have always known that soccer wasn't a game for gentlemen. Rugby football, which is like American football but without the protective body armor, was the brutal game on "the playing fields of Eton," that famously prepared our top military men for command.

The soccer-playing classes were sent into battle as cannon fodder.

And there the governing body of world soccer goes, proving us right once again. You send in the feds, the Swiss send in their crack teams to arrest top FIFA officials on corruption charges and, presto, nothing much happens.

Fortified with strong words of support from Russian president Vladimir Putin, FIFA president Sepp Blatter insists on standing for re-election on May 29 to his fifth term at the helm.

It is true, he says, that some people want to hold him "ultimately responsible" for the soccer community, but he can't "monitor everyone all of the time."

A gentleman would stand aside in favor of someone who might be able to monitor everyone at least some of the time. A gentleman would stand aside in favor of someone who might be prepared to say the buck, or in this case, the ball, stops with him.

Instead, Blatter says it must fall to him to bear responsibility for the reputation and well-being of the organization he leads.

It is he, who must "find a way forward to fix things."

But hasn't the alleged "fixing" -- of bids to host the World Cup -- been exactly the problem all along? What FIFA needs is not a fixer, but a new broom.

It needs a Hercules, to borrow a classical image, a super hero with the strength to divert a river through the Augean Stables and clean out all the stinking accretions of corruption that have piled up in the organization on Blatter's watch.

FIFA won't change. Switzerland, the country that hosts the organization -- and Blatter's country of birth -- has had to change a little more.

It has begun to co-operate more fully with the U.S. in recent years. That cooperation has extended to signing an extradition treaty and allowing American investigators to probe the affairs of world football.

It had to be dragged kicking and screaming into doing so, but it has even been prepared to give the United States some limited access to information about American citizens' accounts at its notoriously secretive banks.

The timing is clearly a coincidence, but it speaks volumes about the change in attitudes, that on the day of the FIFA arrests, Switzerland signed an agreement with the European Union preventing E.U. citizens from hiding undeclared income in Swiss banks. On the following day, the U.S. Department of Justice announced non-prosecution agreements with four banks as part of its investigation of American citizens' use of Swiss-based institutions to cut their tax bills.

But what about the banks themselves? Eight years after the start of the financial crisis, they are still fighting the regulators.

In Switzerland, up to a point, fear of retribution from local and U.S. regulators has tamed spirits for now. But in Britain, the big banks are arguing for a repeal of the requirement to ring-fence their retail operations from their investment banking activities or demanding exemptions from it.

Failing that, they want a postponement of the requirement to have the ring-fence in place by 2019.

One furious regulator, former Barclays Bank chief executive Martin Taylor, has hit back.

He pointed out that the objective wasn't merely to make the banks safer but also to ensure that they were easier to resolve and wind-up in case of collapse.

It was also important to break the link between the taxpayer's guarantee of retail deposits and the implicit guarantee of the whole institution that the intermingling of retail and investment operations entailed, Taylor said.

Yet even as it tries to control the banks, the United Kingdom is demanding an exemption from conflicting E.U. regulations, which call for a separation of banks' trading activities, along the lines of the Volcker Rule in the United States. Compliance would either force Britain to double up on, complicate and add to the costs of its own ring-fencing regulations or drop some of its own stricter rules.

France and Germany are opposed to granting Britain an exemption because they have reached a cozy little arrangement that softens the restrictions on their own banks but could make life tougher for their competitors in London. Cue big fight over the special status of the City of London, which Prime Minister David Cameron is demanding as part of his quest for E.U. reform.

Yet amid the kerfuffle, Europeans on both sides of the English Channel continue to worry that U.S. regulators are extending their extraterritorial reach.

It works for us in soccer. We can laugh at Putin's claim of support for Blatter and his claim that the U.S. is meddling in FIFA's affairs in an attempt to take the 2018 World Cup away from his country.

And, for the most part, it works for us in the financial sector. We are quite happy to see the banks fined for money laundering, interest rate manipulation, foreign-exchange manipulation and so on.

European regulators have been slow to join in, but at least they are following the American lead.

What is galling is when it appears that American regulators are tougher on foreign banks than their domestic institutions. And when they start wanting to extradite individuals who could and should stand trial at home -- such as the lone London day trader who allegedly caused a multibillion dollar flash crash -- we tend to think that they are plucky, admirable rebels who are innocent until proven guilty.

But the banks' own leaders see themselves as plucky and admirable, too, and as the defenders of the reputation and well-being of the organizations they lead. They can't be expected to monitor everyone all the time, they say, but think that their job will be "to find a way forward to fix things."

And that is where they are making the same mistake as Blatter. It isn't a simple fix from within that is needed.

Eight years after the markets began to freeze up, nearly seven years after the collapse of Lehman Brothers, there is little indication that that self-belief, that belief in a banker's inalienable right to thumb his or her nose at regulators, taxpayers and the public at large, has in any way diminished.

Nobody seriously thinks that attitude is different among U.S. bankers. On the contrary, attitudes on Wall Street are more deeply entrenched.

But if the U.S. is prepared to divert its rivers into our own banks' Augean Stables, when our own regulators won't, well, then welcome back to Europe, Hercules.

Your labors have only just begun.

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