At a FIFA Congress in Sao Paulo in the lead up to the World Cup, Greg Dyke was one of 65 delegates to receive a designer watch valued at £16,344, in a gift bag supplied by the Brazilian Football Confederation (CBF).
Dyke maintained he was blindsided by the opulent gift, with FIFA's ethics committee recalling the watches.
"I welcome FIFA's investigation on the matter, including their intention to donate the items to good causes back in Brazil," he said.
"The fact that gifts of great value are being handed out randomly, and often with the recipient unaware, shows up a culture in need of change."
He added: "It was the fourth watch I've had since I started doing this job.
"Everywhere you go you get these watches. I wouldn't know a £16,000 watch if my life depended on it.
"No one should give you a £16,000 watch without telling you what it's worth."
A statement from FIFA's ethics committee (FCE) slammed both the CBF for supplying the gifts, and also warned delegates who failed to immediately hand back the watches to be more proactive in future.
"CBF produced records indicating that it obtained the watches from Parmigiani, a CBF sponsor, at a price of $8,750 [£5,400] each. The investigatory chamber commissioned an independent appraisal of one of the watches CBF distributed," the statement read.
"That appraisal determined that the watch had a market value of 25,000 Swiss francs [£16,000]. That value was confirmed by a later appraisal done in Zurich.
"The FCE plainly prohibits such gifts. Football officials may not offer or accept gifts that have more than 'symbolic or trivial value'.
"Accordingly, CBF should not have offered the watches, and those who received gift bags should have promptly checked whether the items inside were appropriate and, upon discovering the watch, either returned it or, like the football officials referred to above, reported the matter to the investigatory chamber.
"In an effort to resolve this matter, the investigatory chamber will not pursue further formal ethics proceedings in this matter against officials who submit the Parmigiani watch they received from CBF to the secretariat of the investigatory chamber by no later than Oct 24, 2014.
"The investigatory chamber and CBF have agreed that, following the deadline, all watches submitted to the investigatory chamber will be donated to an independent non-profit organisation or organisations committed to corporate social responsibility projects in Brazil."
