Indian Premier League: Not Quite Cricket
|Our Correspondent||Apr 23, 2010|
A scandal surrounding the US$4.13 billion Indian Premier League has brought some of Indian cricket's murkiest secrets out into the public glare. The affair, which involves allegations against top Indian politicians, A-list celebrity team owners, Bollywood stars and the premier league's establishment – has sullied the reputation of perhaps India's most popular sport.
"The IPL is possibly the murkiest sporting league in the world,” a senior Enforcement Directorate official told Asia Sentinel on the condition of anonymity. "Slush money from tax havens, foreign ownership through dubious means, benami transactions (in which properties are held in the name of another individual), fraud, money laundering on a massive scale, illegal betting, bribery in awarding TV rights has been all been a part of the IPL package with the connivance of top officials. I won't be surprised if match-fixing too has been a part of the racket.”
The still-unraveling affair threatens to engulf more people at the top of Indian society and government. Heads have already begun to roll. On April 18, junior Foreign Minister Shashi Tharoor, earlier India's contender for the post of UN Secretary-General, was forced to resign due to his alleged complicity in using a proxy to acquire a premier league team for his girlfriend.
More politicians including powerful union minister Sharad Pawar and his MP daughter Supriya Sule and her husband, and the minister for civil aviation, Praful Patel -- are also reported by local media to be involved.
The story began on April 11 when news broke that Tharoor had pulled strings to grant a new league franchise worth US$15 million to a Dubai-based socialite, Sunanda Pushkar, allegedly Tharoor's girlfriend. The minister had put together a consortium that bought the Kochi team in Kerala, the southern state he represents in the parliament, and the opposition accused him of securing the stake for his friend as a "fee” for her services. According to India's Prevention of Corruption Act, if a person in public office dabbles in commercial activity clandestinely, he or she is liable to prosecution.
A subsequent series of sensational Twitter posts by Lalit Modi, the premier league commissioner and one of India's richest men, divulged the names of individuals who apparently had been given free equity in the obscure Rendezvous Sports World consortium, which had paid US$1 billion to snag the Kochi franchise. Modi, a convicted felon with a long string of charges against him including drug possession and kidnapping with intent to kill in the United States, is president and director of Modi Enterprises, one of the country's premier conglomerates.
The disclosure infuriated the members of the consortium, which dashed off a legal notice accusing Modi of breach of confidentiality. The franchise also complained to the Board of Cricket Control of India, the premier league's parent organization -- about Modi's indiscretion.
Modi hinted there was pressure on him to keep mum about the details of Rendezvous' owners. "What I have put on Twitter,” he insisted, "is in no way breach of confidentiality as who the shareholders are we have always provided in the past and it is not a matter to hide. Further, it is the Kochi franchisee who has a lot to hide and as such has lied about who are the actual owners of the shares.”
Tharoor vehemently denied being a stakeholder in the Kochi franchise and instead called himself a "facilitator.” He alleged that Modi had made various attempts to pressure the members of the Kochi consortium to abandon their bid in favor of another city in a different state.
As media pressure grew and the opposition demanded Tharoor's blood, he quit with an impassioned speech in the Parliament highlighting his personal integrity and what he insisted was a flawless professional record.
Modi himself soon came under fire via a confidential report by India's tax authorities that was leaked to reporters describing manipulation of land deals in Rajasthan and the existence of a "maze of shell companies and offshore entities used to route payments and equity stakes worth hundreds of crores (1crore =10 million) of rupees,” according to a report in the Times of India. The tax report also alleged that Modi was using insider information and betting through associates as well as possibly fixing premier league matches.
Before he became premier league chief, Modi was reportedly notorious for his proximity to former Rajasthan Chief Minister Vasundhara Raje, who critics said turned a blind eye to the Modi's questionable land deals in the desert state. Modi in fact was nicknamed 'Super Chief Minister' and `Mr. 10 Percent.' Critics accused him of arm twisting bureaucrats into routing papers on all big real estate deals in the state through his office.
Meanwhile, the Board of Cricket Control said it would convene a meeting of the premier league Governing Council in late April to decide their future course of action and Modi's fate. Speculation is rife that the premier league chief – his clout notwithstanding -- may well be shown the door. However, Modi is characteristically defiant. "I will not resign,” he told reporters. "I will present all the facts about the allegations to the IPL governing council.”
The scope of the probe has now been widened globally. Income tax and Enforcement Directorate sleuths are investigating possible links to overseas tax havens such as Mauritius, Dubai, Kenya, South Africa and Nigeria. Premier League teams linked to Bollywood stars such as Shilpa Shetty and her London-based billionaire husband Raj Kundra, who co-own the Rajasthan Royals, have been made public.
Sources say favors were also granted to those who lined the league's coffers. According to a Mail Today expose, while the rights to televise the league's first season were given to MSM group for US$1 billion, BCCI sold the telecast rights for the second season to World Sports Group (WSG)-Mauritius for a fraction of the price -- at US$75 million. MSM was forced to strike a deal with WSG with a facilitation fee of US$80 million. It was later alleged that WSG had paid large sums to Lalit Modi's associates for the favor and transferred some stakes in the company to them.
Similarly, Web rights for IPL and Champions League, Mail Today reported, were given to Live Current Media (LCM), headquartered in Vancouver, Canada in 2008 for US$48.6 million. For the second season, the contract went to Global Cricket Ventures (GCV) Private Ltd, headquartered in Singapore, for just US$20.5 million. Later, it formed a joint venture with Netlinks Blue Holdings, which owned the mobile and digital rights for the same event. Netlinks Blue was promoted by Akash Arora, Modi's close friend. In August 2009, the contract was transferred to a Mauritius- based company with the same name for just US$1.73 million and an "unaccounted hefty sum” given to some top premier league officials.
EM Sporting Holdings Ltd, the registered entity in India that owns the Rajasthan Royals, is registered in Mauritius. Modi's brother-in-law Suresh Chellaram, a Nigeria-based businessman, and his family hold 44 percent of the company.
Neeta Lal is a New Delhi-based journalist contactable at neetalal at hotmail dot com