Gold Medal Disgrace

On the heels of a doping scandal in 2006, Austria again faces Olympic controversy

News | Michael R. Weingartner | October 2009

The President of the Austrian Olympic Committee (ÖOC), Leo Wallner, resigned in early September following accusations on holding back information concerning the abuse of committee funds by former the Secretary General.

Wallner resigned following an internal audit by the ÖOC in late 2008, which revealed that former Secretary General Heinz Jungwirth had embezzled €72,000 worth of funds.

"I don’t know anything," Wallner insisted when questioned about the financial discrepancies. Wallner said he was "absolutely shocked" by Jungwirth’s behavior and added that he "never thought [Jungwirth] would abuse his trust in this way." Jungwirth, who was dismissed in August this year, had also embezzled funds earmarked for the Salzburg bid for the 2014 Olympic Winter Games. In retrospect, many believe that this scandal hindered Salzburg’s pursuit for a bid. Even €1.17 million spent on lobbying for Salzburg’s bid was unable to reverse the negative fallout from the scandal.

When it came time for the vote to decide on the host for the Winter Games 2014, Salzburg lost in the first round. And in July 2007, the Games were awarded to the city of Sochi in Russia, which won over the South Korean city of Pyeongchang in the second round of voting.

Heinz Jungwirth allegedly took money from various accounts and used it for his own. Already in March this year he refunded around €18,000; in late July the remaining €54,000 followed. The ÖOC, however, is not yet completely satisfied, as they want Jungwirth also to forgo his dismissal pay worth €180,000.

Jungwirth refused to refund his dismissal pay and hence the ÖOC are looking into filing a complaint at the public attorney’s office. In order for this to happen the ÖOC Board of Directors must agree on a legal basis and only then the public attorney’s office can start investigations. Even treasurers Gottfried Forsthuber and Gerhard Hofbauer are accused of improper conduct for having failed to report possible lapses. Hofbauer is skeptical of this claim as, in his opinion, any discrepancies point to a failure of the whole Board of Directors. He even disclosed some information about a General Assembly meeting. "There have never been rules of procedure for the Secretary General," he told the newspaper Die Presse am Sonntag. Jungwirth was equipped with full powers, supposedly signed by Leo Wallner.

The recent scandal mars the reputation of Austrian Olympians, coming on top of the Winter Games in Turin in spring 2006, when Austrian cross country skiers and the biathletes were embroiled in a doping scandal.

Within the application of Salzburg’s bid for the games, which the Olympia Förderverein (Olympia Supporting Association) is in charge of, Jungwirth was in favor of installing two funds, one for public money, the other one for sponsor money.

"Why should there be two funds if everything went according to the rules"? Anton Schutti, the former Secretary General in charge of Salzburg’s bid, asked. Schutti always was against two funds.

Leo Wallner and Heinz Schaden, Salzburg’s mayor, explained that they never knew about the funds within the Olympia Förderverein. Jungwirth and Olympia Lobbyist Erwin Roth, however, declared on Austrian national television whether Wallner and Schaden knew about certain operations. Schaden argues that he was not in favor of the foundation of the Olympia Förderverein as asserted by Jungwirth.

After the unsuccessful bid for the 2010 Games, Schaden said that there is a need to create a side fund in order to deal with sponsors’ money, Jungwirth claimed. This is supported by Erwin Roth who acted as a lobbyist and whom the public attorney’s office also is investigating. Schaden confronted these accusations and to the fact that Roth’s business received €1.17 million for lobbying work, he answered that Roth did not achieve anything for his lobbying.

It seems that the current crisis is not just a mismanagement of funds. The ÖOC’s structure is too complex and unclear. It is very much in the public interest that a solution to this crisis is found soon, as tax money is being spent and Austria’s Olympic future is at stake. Austria needs a modern ÖOC, which should not be hindered to be constructive through political affiliations.  Members across the political spectrum wished that the ÖOC would be newly integrated within the BSO (Bundessport Organisation) functioning on a national level. At the moment they are not able to make useful decisions.  This would create a strong umbrella organization being able to drive home a bid maybe not for 2014, but 2018.

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