As the North American Soccer League gears up for its championship final between New York Cosmos and Indy Eleven in New York on Sunday, Tampa Bay Rowdies owner Bill Edwards has warned he is poised to take legal action against the league, alleging ties to “dirty money”.
Edwards, a real estate investor based in St Petersburg, Florida, withdrew the Tampa Bay Rowdies from the second-tier NASL last month, instead opting to play next season in the United Soccer League, a third-tier competition featuring smaller market clubs and Major League Soccer reserve teams.
Edwards told the Guardian his legal action will be based on NASL ties to Traffic Sports, a Brazilian-owned sports marketing company where two executives, Jose Hawilla and Aaron Davidson, pleaded guilty to corruption charges resulting from the 2015 FBI investigation into Fifa and the Concacaf confederation.
“It’s dirty money in and clean money out,” said Edwards, who bought a controlling interest in the Rowdies in 2013. “The situation involving Traffic Sports and its involvement in the league has not been resolved to my satisfaction.”
Edwards claims his Rowdies team was “fraudulently induced” to participate in NASL “by the league”, whose management at that time included Davidson, an American who acted as the NASL board chairman and also took a role as President of Fort Lauderdale Strikers, another NASL team. Davidson was suspended by the league when the FBI indictments were made public.
“I would have never joined NASL at the time had I been aware that Traffic Sports and [Davidson and Hawilla were involved with] criminal activities,” said Edwards. “The league management at the time, including Aaron Davidson, made material misrepresentations and omissions regarding the integrity of the league and its financial hygiene.”
Edwards’ legal action will serve as a blow to a league already facing significant challenges as its season reaches a climax. Ottawa Fury will also leave the NASL for the USL next season, while Minnesota United will make an upward move to Major League Soccer next year. Financial question marks cloud the future of Fort Lauderdale Strikers and Rayo OKC.
Davidson led the 2009 relaunch of the NASL when he convinced several teams playing in USL to join a new version of the league. Traffic handled the new league’s business activities and funded the Carolina Railhawks, Fort Lauderdale Strikers, Minnesota Stars and Atlanta Silverbacks. The NASL suspended its relationship with Davidson and Traffic when the allegations were made public but according to Edwards, a relationship continues.
Prior to working for Traffic Sports, Davidson had worked at a sports marketing firm that subleased office space in Trump Tower in Manhattan from Chuck Blazer, the American Fifa vice-president who turned FBI witness and pleaded guilty to racketeering, wire fraud, money laundering and tax evasion.
Davidson pleaded guilty to racketeering conspiracy and wire-fraud conspiracy charges in federal court in Brooklyn last month, the 20th conviction by the Department of Justice connected to last year’s Fifa-related arrests.
“I have stressed to the league the importance of separating itself from Traffic Sports and the corrupt criminal enterprise to no avail,” Edwards said. “I never wanted to leave the NASL. I fought for two years to clean it up. I couldn’t get enough cooperation from the league and at the end of the day I was basically forced out. I couldn’t in all good faith be involved in a league in the condition it is in.”
Court records obtained by the New York Times last year revealed that the NASL’s ownership structure is divided into “Class A” stakeholders – team owners with voting rights, including Traffic – and “Class B” for other stakeholders that have invested money in the league. Traffic Sports is the majority “Class B” stakeholder.
In a conference call with reporters on Wednesday, NASL commissioner Bill Peterson declined to clarify NASL’s relationship with Traffic Sports, claiming he did not want the subject to distract from Sunday’s final.
“We’ve resolved almost all the relationships [with Traffic Sports] and what is left will be settled soon enough,” was his only comment. The Guardian also asked the league to clarify the nature of their relationship with Traffic via email. The NASL declined to comment.
The NASL has long been the wild child of pro soccer in North America. The name was initially used for the first truly national league that operated from 1968 to 1984. The story is well known: late 1970s, New York Cosmos, Pele, Carlos Alberto, Franz Beckenbauer, 73,000 fans at Giants Stadium. That league shut down in 1984 when only two teams wanted to participate.
In 2009, Davidson relaunched the NASL with reborn versions of New York Cosmos, Fort Lauderdale Strikers, and Tampa Bay Rowdies. The league was eventually sanctioned by the US Soccer Federation – after significant political wrangling – as North America’s second division, a tier below Major League Soccer.
The most-recent season saw 12 teams participate in the league including the far-flung Puerto Rico Islanders and Canada’s FC Edmonton. Next season, San Francisco Deltas will join the league.
“We are not the first league to go through growing pains,” said Commissioner Peterson, in an interview with the Guardian, explaining the league’s current instability.
Peterson’s elevator pitch is that the NASL has a low barrier for entry, and a lack of regulation comparative to MLS, which makes it a less complicated investment for any party looking to put money into North American soccer.
“If you can overlay the population of the United States over western European soccer countries you would have over 150 first division clubs,” he said. “If we end up with 30, or 40, or 60 professional clubs [across all leagues] in this country, the opportunity is massive. I think it is too early to tell where it goes but over time we will see how big we get. It is a little early to start writing the final chapter of this league when we are just getting started.”
Peterson’s optimism is shared by Peter Wilt, a soccer industry veteran leading a bid for a team from Chicago to join the league.
“There’s potential for the Chicago team to be a really big deal. It could be a game changer for the league,” said Wilt, who launched Chicago Fire for MLS in 1997 and in 2013 oversaw the launch of Indy Eleven, which will play for the championship on Sunday.
“If Chicago is in, it would attract other big investors, change the dynamic of NASL, and get it to be the type of league that all the investors dreamed it was going to be. If the Chicago deal doesn’t come through, then that is one less chance for the league to make that dream.”
Indy Eleven are an NASL success story, noted for their community engagement and drawing crowds of around 9,000 to home games. Wilt is also an advisor for Club 9, an American investment company with a specific interest in professional soccer teams and claims unparalleled interest in investment in the NASL.
“I have never seen anything like it,” he says. “Investors see the long-predicted soccer boom is finally here and want to get in on the ground floor at relatively low cost with an immature product and market that is going to grow.”
The challenges are real, however, and the plight of the New York Cosmos, who have dominated the NASL since they entered the league in 2014, may be a metaphor for the league. The team is owned by Sela Sports, a Saudi Arabian company, in a partnership with Lagardere Unlimited, a French sports and entertainment agency, as well as World Sport Group, a powerful sports media and marketing company based in Singapore, founded by Cosmos chairman Seamus O’Brien.
Cosmos have a sponsorship deal with Emirates and in recent seasons has included in their line-up Real Madrid legend Raul, Spanish international and Euro 2008 winner Marcos Senna, and Venezuelan star Juan Arango.
Home matches are played at Hofstra University on Long Island, in a 12,000-seat stadium shared with the school’s football and lacrosse teams, but Cosmos will host the final at Belson Stadium in Queens – Hofstra is booked for a university event this weekend. Belson Stadium has a capacity of 2,168 and its field is built on top of a parking lot.
“There is no doubt that playing at Hofstra has hurt our growth tremendously,” said Cosmos chief operating officer Erik Stover. The club has been frustrated in attempts to build its own stadium in the New York area.
“We seem to get to the finish line with our stadium proposal and then get pulled back for one political reason or another that is not explained to us.”
Stover says the Cosmos board and its ownership is committed to the NASL, even with current challenges. The truth is that, with MLS shutting the door on a third New York team, Cosmos has little choice.
“People said MLS was going to die 15 years ago,” Stover said. “There is loads of money coming into soccer in the US, but there is not a structure that everyone agrees on. Without an accepted structure, you are going to have differences of opinion and and it is not always going to go the way NASL or MLS or US Soccer wants. The politics of soccer in the United States is pretty volatile at the moment and NASL has to work through some things and I don’t think anybody knows what any of this is going to look like in five years.”
It’s equally possible no one knows what any of this will look like after legal action from Bill Edwards and the Tampa Bay Rowdies. The Fifa scandal had long arms that reached all the way to lower leagues in North America.
“You don’t spend a lot of money joining a league and then leave it and spend more money going to a different league, unless of course there are issues that you can’t resolve,” Edwards said. “I don’t believe they can clean it up. You can’t clean something that is dirty and make it clean. Unless, of course, you get rid of the dirt.”