““A very small group of people was [doing] things that clearly violated IOC rules,’’ said Utah Gov. Mike Leavitt last week. ““I didn’t see [the corruption], and I don’t know anyone who did.’’ But in this death by a thousand embarrassments, deniability is becoming increasingly untenable. A report by the Salt Lake Organizing Committee’s (SLOC) own ethics panel, due this week, is expected to detail some $800,000 in improper spending. Between 1992 and 1995, for example, Salt Lake’s bid committee paid about $19,000 to the stepdaughter of Ecuadoran IOC member Agustin Arroyo. (The IOC board recommended his ouster last month.) Sources say that the committee first got the 44-year-old woman a job as a commercial artist at a private firm in Salt Lake, but soon had to reassign her to phone duties at the Olympic offices. Later the committee paid her rent and other expenses and, when she quit to attend school, her tuition.
And government agencies, including the FBI and the IRS, are still probing the site-selection process. U.S. Customs agents are investigating allegations that a Salt Lake City backer carried cash–estimated at as much as $50,000–out of the country to the 1995 IOC confab in Budapest, where Salt Lake was awarded the 2002 Games. According to a senior law-enforcement official, they are also checking whether U.S. bank accounts were set up to facilitate the cash exodus; additional money may have been transported in amounts of less than $10,000–““smurfed,’’ in federal parlance–to skirt currency-disclosure laws. Beth Wilkinson, an attorney representing the SLOC, says, ““We are unaware of any information that suggests SLOC members were enlisted to take any money out of the country.''
Salt Lake Olympic officials have repeatedly denied any wrongdoing. And civic leaders have scurried to contain the blame, pinning it largely on former bid-committee president Tom Welch and VP David Johnson, who have already resigned. Both have denied engaging in illegal activities. Welch insists he disclosed all policies and actions to his board. ““We didn’t hide anything,’’ he says. His attorney, Tom Schaffer, said the board was drawn from ““the cream’’ of local business leaders. ““Would they have put their and friends’ money into this and not attempt to control where it was spent?''
Even if the ethics panel and other investigating agencies sort out the tangle of how Salt Lake won the Games, a new controversy looms. Some Salt Lake board members stand to profit from the 2002 Olympics. Sinclair Oil chairman Earl Holding, for example, has several Olympic deals: the SLOC has rented his Snowbasin ski resort for $9.8 million, millions more in federal funds will help build an access road into his resort and he is building a downtown luxury hotel that will likely house the free-spending IOC delegation. Clint Ensign, chief of government relations for Sinclair Oil, defends the ventures. The SLOC has no rules precluding business relationships with its board members, only disclosure requirements, and Ensign says Holding ““has recused himself at the appropriate times.''
IOC president Juan Antonio Samaranch has claimed ignorance of his colleagues’ greedy habits. But last week officials of the now defunct Toronto bid committee, which lost the ‘96 Games to Atlanta, put the lie to that excuse. They released documents revealing that they formally complained to the IOC about its delegates back in 1991. In them, Toronto officials estimated that abuse of travel privileges by IOC delegates cost it in excess of $700,000–and that didn’t even include the gifts. ““The rules governing the activities of the bid cities are ambiguous or poorly enforced,’’ the Toronto committee told the IOC back then. ““Many IOC members expected to receive gifts above and beyond what anyone would judge to be courteous and gracious.’’ Norman Seagram, who was vice chairman of the committee, told NEWSWEEK that the Canadians were besieged–““on up to 20 occasions’’–by improper requests. The IOC promised to answer their complaints, he says, but ““they never did.’'
Samaranch had clearly hoped, after the IOC board meeting last month, that a few resignations and threatened expulsions, as well as some modest reform proposals, would staunch the crisis. But crisis now appears to be a near-permanent mode. With the entire IOC scheduled to meet in March, Samaranch’s reform agenda is being bucked publicly by many members. In addition, sources indicate that at least one delegate targeted for expulsion is threatening to ““tell all’’ if he is bounced.
The 78-year-old Samaranch is likely to survive at the helm, in part because of the lack of a strong alternative. Moreover, Samaranch has the support of some key nonvoters in the Olympic movement. Dick Ebersol, president of NBC Sports, which spent almost $3.7 billion on Olympic broadcast rights through 2008, sees Samaranch as an essential part of the solution. ““He’s a very astute diplomat, and his skills are needed now to build a strong consensus,’’ says Ebersol, who insists that NBC has heard no complaints from its Olympic advertisers.
Obviously Ebersol hasn’t spoken with David D’Alessandro, president of John Hancock Mutual Life Insurance and the most outspoken of the Games’ corporate partners. D’Alessandro is perturbed at how Samaranch ““backpedaled’’ after his pledge last month to unearth all corruption. The almost-instant exoneration of Sydney’s effort to win the 2000 Games was particularly galling. ““It’s clear to me that Samaranch still doesn’t get it,’’ says D’Alessandro. ““All the sponsors should be demonstrating the outrage necessary to make the IOC live up to the values we are renting. If they fail to deliver their end of it, I think the validity of the contracts is challengeable.''
But some athletes, who are the heart of the Games, say the current scandal provides an opportunity for genuine reform. ““There are many people in the Olympic movement who truly want to see it get clean and pure,’’ says Picabo Street, a skiing gold medalist in Nagano. ““This is our chance–and our responsibility–to pounce and get it turned in the right direction.’’ Clean and pure may be too much to hope for. But the Olympics will never be quite the same again. And that may turn out to be the good news.
