Since 2001, the NCAA and its members have been instrumental in the passage of the Uniform Athlete Agent Act (UAAA) and other similar laws in 44 states (40 adopted the UAAA and 4 states have laws regulating agents).
So has it worked? Well, not exactly.
According to a 2010 review by the Associated Press, "more than half of the 42 states with sports agent laws didn’t revoke or suspend a single license, or invoke penalties of any sort. Neither had the Federal Trade Commission, which was given oversight authority by Congress seven years ago."
So did the NCAA admit defeat and move on? Heck no. It doubled down.
Some believe the problem with the state agent laws is they don't have any real teeth. Maybe if violators were subject to jail time and significant financial penalties, agents think twice about flouting NCAA rules.
That's apparently the theory behind California Senate Bill (SB) 238, signed into law last week by Gov. Jerry Brown. SB 238 strengthens penalties of agents who violate the Miller-Ayala Athlete Agents Act.
According to the bill’s author, California State Senator Kevin de León: "The dirty secret behind student athletes is that they toil for long hours pursuing their dreams but are often living in poverty. They are very vulnerable to unscrupulous agents preying on them in the hopes of a future reward. I am thrilled California is now one step closer to preventing student athlete victimization with the passage of this legislation."
First of all, it is a hardly a "dirty secret" that athletes are poor and work hard, but okay. Second, the notion that we are one step closer to "preventing student athlete victimization" is laughable.
In May, I was an invited speaker at an informational hearing held by Sen. de León.
The short version of my testimony:
Our government should be focused on far more important matters (e.g., jobs, the deficit!). It is absurd to elevate NCAA rules into law, especially if the NCAA consistently argues against outside intervention when it suits its purpose. There is virtually no enforcement of these laws. It is touted as protecting student athletes, but it's mainly about protecting NCAA institutions who see a correlation between agent contact and athletes turning pro early. There are no criminal penalties for coaches, athletic administrators and boosters who engage in similar activities. Last but not least, NCAA agent rules are completely unfair to begin with.
I am not really upset the bill passed, although if I knew the fix was in I would not have wasted my time testifying. I know the drill: Powerful people at powerful institutions usually get what they want. But...my state is drowning in a $26 billion budget deficit and they are worried about a few rogue agents who do not follow NCAA rules.
Actual steps to protect college athletes
Yes, the sports agent industry should be regulated in some fashion. I just do not believe the NCAA deserves governmental assistance when it comes to enforcing unfair (and likely illegal) rules that harm college athletes. If Sen. de León wanted to get one, maybe two steps closer to "preventing student athlete victimization," he should champion legislation that:
- strikes down the NCAA's "no agent rule," which harms both athletes engaged in the negotiation of professional sports contract and those considering turning pro
- allows schools to provide multi-year athletic scholarships
- increases the value of such aid to the full cost of attendance
- similarly encourages coaches, athletic administrators and boosters to follow NCAA rules (not that I am in favor of making NCAA rules into law, but if we're heading down that path, why not?)
California’s Miller-Ayala Uniform Athlete Agents Act
Why was Senator de León interested in protecting student athletes? For starters, I am sure the NCAA and its members lobbied hard. Since the Miller-Ayala Act was enacted in 1996, no agent has been charged with violating.
According to de León's press release, SB 238 "protects student athletes by requiring the courts to suspend or revoke the business privileges of an athlete agent convicted of violating the Miller-Ayala Athlete Agents Act. Additionally, athlete agents are required to disgorge all gross revenues received in connection with the violation. This bill not only applies to athlete agents, but also 'runners' who are often friends, family members, marketers, and real estate/financial advisors."
SB 238 clearly spells out possible penalties: "An athlete agent or athlete agent's representative or employee who violates any provision of this chapter is guilty of a misdemeanor, and shall be punished by a fine of not more than fifty thousand dollars ($50,000), or imprisonment in a county jail not exceeding one year, or by both that fine and imprisonment."
Whoa! So a parent who does not follow NCAA rules can now be characterized as an agent and end up in the slammer? Writer Dennis Dodd once relayed what a former NCAA staffer told him, "If it wants to, the NCAA can make a ham sandwich a representative of a university's athletic interests." Surely NCAA enforcement can work the same magic with agents. (I doubt that was covered at the recent NCAA Enforcement Experience.)
One of my favorite cartoons from my book, , seems even more prescient...
This may close the so-called "Cam Newton Loophole" but think how this might play out going forward: The next version of Reggie Bush or Cam Newton could put a parent in jail for up to one year. That'll do wonders for recruiting.
UAAA background
Let's look at the whole issue of government interceding on the NCAA's behalf to address sports agents:
In the late 90s, the NCAA declared a virtual war against agents. The NCAA enlisted the National Conference of Commissioners on Uniform State Laws (I am sure at considerable cost) to draft a model law that would “provide a uniform system for regulating athlete agents.” That almost sounds reasonable. But the UAAA also, in effect, elevates violations of NCAA rules into violations of state laws carrying civil and criminal penalties. Clever.
Here part of a "sample letter of introduction", which the NCAA posted on its website to encourage its members to send to state legislators:
Unprincipled agent conduct presents a legitimate threat to the vitality of amateur athletics. While many agents perform a valuable service for their clients, dishonest agent conduct, intended to take advantage of the student athlete for financial gain, results in the loss of student-athlete eligibility, the imposition of financial penalties on the student-athlete's institution, and the taint of "scandal" on both the institution and the entire community of amateur athletes.
Very true, but the same can be said about "unprincipled" conduct by coaches, athletic administrator and boosters. Of course, the NCAA and its members would never want laws that could ultimately be used against their own.
And don't forget: When the NCAA wants to be left alone, it argues that it is a private, voluntary association, legally entitled to establish its own rules and regulations without outside interference. If you don't like, go work or play somewhere else. Take that, Jerry Tarkanian and anyone else who feels mistreated by the NCAA and sought justice through our judicial system. But...the NCAA can't effectively regulate sports agents. So the NCAA asks for government assistance. Nicely played. All this works, of course, because not many people track the NCAA or even care to bother. Exhibit A: I said all this at de Leon's hearing and see how much good that did.
For more information, my good friends Darren Heitner and Joshua Golka have have written extensively on the UAAA.
Mischaracterized problem
One of the main points I stressed at the hearing is that despite what the NCAA wants us to believe, this is not an agent problem. This is an amateur problem, created by a one-sided system that artificially caps athletic scholarships and denies college athletes the right to agent counsel. Ultimately, these rules encourage an unfortunate underground market for elite, mostly poor college athletes.
Also worth noting: With all the lobbying by the NCAA and its members to pass agent legislation, we are not talking about more than a couple hundred college athletes who are not only tempted to be bankrolled by agents, but actually accept such offers. And, perhaps most important of all, unscrupulous agents do not commit the worst crimes against broke college athletes. No, the worst offenses are committed against pro athletes who have actual money to steal.
Solutions?
Sorry, but there are none. At least not in its present form. Until the NCAA membership agrees to do an about-face on its agent and amateur rules, the underground market for players will continue to drive market force.
Yahoo! Sports' Dan Wetzel recently offered one, simple solution: "The way to end the selling of football/basketball recruits is to have schools stop buying them." Exactly.
The NCAA likes to claim that college athletes are entitled to talk with agents and even benefit from their services. Of course, there is some notable NCAA fine print:
“If you receive assistance from an advisor, you must compensate the advisor in an amount equal to the value of the services he or she provides you…without jeopardizing your eligibility, regardless of whether the advisor does not typically charge clients for such services.”
Translation: If the NCAA wants to bring down an athlete, a parent, an agent or a ham sandwich, this provision spells trouble.
--Marc Isenberg
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