Sporting Nike team jerseys, Brazil teammates Hernanes, left, Neymar and Fred celebrate a goal on June 12, 2014 in the 2014 FIFA World Cup in Sao Paulo, Brazil. (Adam Pretty/Getty Images)

After Nike signed what was then the biggest sports deal in history, a $200 million sponsorship of Brazil’s triumphant soccer squad, company executives said the agreement was as crucial to its success as its legendary pact with Michael Jordan.

But a federal investigation into FIFA corruption has cast a shadow over the 1996 deal that helped Nike vault to stardom in the world’s most popular sport.

While the federal indictment does not name Nike, it describes a “multinational sportswear company” involved in a strikingly similar deal. And a law enforcement official close to the investigation, who spoke anonymously because he wasn’t authorized to speak publicly, confirmed Nike was the sportswear company mentioned in the indictment.

If implicated, the $88 billion sports giant could find one of its key victories tarnished by the blockbuster scandal now haunting international soccer. More than a dozen FIFA officials and executives face federal charges of 24 years of deep corruption and $150 million in alleged bribes.

Embroiled in a crisis, Nike could lose loyalty from the same international fans it has spent heavily to attract and be set back in its efforts to bolster its standing in soccer, the second-fastest-growing part of its business, behind basketball.

The Post's Marissa Payne details the charges facing nine FIFA officials in a round of indictments from the U.S., and delves into why FIFA's president Sepp Blatter is not facing charges. (Nicki DeMarco and Marissa Payne/The Washington Post)

The company that helped Nike secure the 1996 deal, and its founder, have already pleaded guilty to money-laundering conspiracy, racketeering conspiracy and other charges, pledging to forfeit more than $151 million, investigators said.

“The charging documents unsealed yesterday in Brooklyn do not allege that Nike engaged in criminal conduct,” Nike said in a statement late Thursday. “There is no allegation in the charging documents that any Nike employee was aware of or knowingly participated in any bribery or kickback scheme.”

In a statement on Wednesday, the company said it would continue to cooperate with authorities.

In 1994, when the Brazilian national team clinched a thrilling World Cup shootout victory in California, a representative of the U.S.-based sportswear company approached the Brazilian Football Confederation with an offer of sponsorship, federal court records show.

The team already had an agreement with a different supplier. But after two years of negotiations with a high-ranking confederation official and with the help of middleman Traffic Brazil, Nike nudged out its rival and sealed a 10-year, $160 million exclusive deal to supply the team’s shoes and clothes.

In the very similar deal described in the indictment, the unnamed sportswear company also agreed to pay an extra $40 million into a Traffic Brazil affiliate’s Swiss bank account. Over the next three years, Traffic also invoiced the sportswear company for $30 million in “marketing fees.”

At the time, Nike was a known player across America for its basketball and running shoes. But with growth slowing in the United States, executives were pushing hard to establish a foothold on international shelves.

Here is what each FIFA official is charged with
Nine FIFA officials and five corporate executives face U.S. charges including racketeering, bribery, money laundering and fraud.

(Bonnie Berkowitz and Denise Lu/U.S. Department of Justice)

Nike faced stiff competition from established rivals such as Adidas, the German-based giant famous for soccer shoes, and Umbro, the British firm that served as the Brazilian team’s former sponsor. But with the Brazil deal inked, suddenly Nike had its signature swoosh worn by the stars of the biggest soccer nation in the world.

The company quickly took its victory lap. Nike President Thomas E. Clarke compared the Brazilian exclusive to the most successful athletic sponsorship in history, its megadeal with Jordan, telling BusinessWeek in 1997: “You never overpay for things that are good. This is our most important international deal.”

The Brazilian deal became a launchpad for Nike into other high-profile deals, helping it sign the American, French, English and Dutch national teams, as well as star players such as Cristiano Ronaldo. It also cemented Nike’s reputation as an aggressive dealmaker with an open wallet.

After Nike signed the U.S. national soccer team, Hank Steinbrecher, executive director of the U.S. Soccer Federation, told Businessweek “they came in and said, ‘We want to sponsor the federation. Whatever it’s going to take, we’re ready to do it.’ ... The big advantage Nike has is that it sits down with more chips than anyone else.”

When Nike entered Brazil, the country’s legacy for corruption in soccer dealmaking was already widely known. But the Nike deal, in particular, struck some as suspicious: Why would a team as prominent and powerful as Brazil need the help of a marketing-company middleman?

“There is hardly a form of illegal activity we haven’t come across,” Álvaro Dias, chairman of the inquiry, told the New York Times in 2001. “Since there is no . . . accountability in Brazilian soccer, dishonest team officials can do whatever they want.’”

The investigation, which U.S. Attorney General Loretta E. Lynch has said is ongoing, could become even more serious if it leads to charges of government corruption, experts say. Any company involved could face stiff penalties under the U.S. Foreign Corrupt Practices Act, which forbids companies from seeking a business advantage by paying or promising anything of value to officials overseas.

“Most multinational companies like Nike . . . are very much aware of the risk and possibility of bribing foreign officials,” said Erik Voeten, an associate professor of geopolitics at Georgetown University. “But these companies often do business in countries where bribery is expected if you want to win contracts.”

Working with teams and athletes across the world, Nike is closely acquainted with the dangers surrounding the Foreign Corrupt Practices Act. The Nike code of ethics explicitly reminds its employees not to stray in places where kickbacks are just another (lucrative) way of doing business:

“The fact that bribery may be an accepted local practice in a country does not relieve NIKE employees from complying with the FCPA.” (Also in the code, Nike co-founder Phil Knight wrote, “We play hard, we play to win, but we play by the rules of the game.”)

The Brazilian sponsorship deal paid off handsomely for Nike, both in sales and star power. In 2005, a short video in which Brazilian star Ronaldinho nailed some incredible shots with his new Nike cleats became YouTube’s first viral sensation to top 1 million hits.

Today, Nike’s supremacy in soccer is globally known. Nike sold $2.3 billion in soccer shoes and apparel in fiscal year 2014, topping Adidas’s soccer sales, at $2.29 billion.

Nike has faced little immediate backlash. Its stock has fallen less than 1 percent since the FIFA probe was announced, and its contract as Brazil’s outfitting sponsor lasts through 2018.

Ultimately, experts said, Nike’s biggest danger could be in buyers’ perception. If the company is linked to years of soccer kickbacks, it could lead fans to believe the brand has been part of the problem all along.

“The worldwide soccer fan does not like FIFA,” said Matt Powell, a sports industry analyst with NPD Group. “Anybody who’s doing business with FIFA is tarred by the same brush.”