FBI has subpoenaed Nike's EYBL grassroots division

Submitted by ypsituckyboy on

For those who don't follow college hoops, EYBL is the premiere AAU circuit and it's sponsored by Nike. The biggest of the big dogs (Kentucky, Duke, etc) get their players from this circuit.

This could bring down some really big coaching names if the payoffs weren't don't discreetly.

 

xtramelanin

September 27th, 2017 at 2:49 PM ^

they have such unbelievable resources and it is so dangerous to deal with them - truly a damned if you do, doubly damned if you don't type of deal.   as others have mentioned, thankfully we have st. beilein as our coach.  

as for other programs....incoming! 

GhostofJermain…

September 27th, 2017 at 2:50 PM ^

Dangelo Russel - How is it that a top 10 overall player leaves OF ALL CITIES Lousville, to head to Columbus and join a back to back NIT team?  

 

Tyus Battle - Went from looking for him in the directory, a full 2 page article on how much he loved UofM and knew he was destined to come to AA....To a Sunday stop at the carrier dome where he had already been 5 other times and made his mind up not to attend Cuse, and boom he flips.  

 

BAG $ EVERYWHERE

stephenrjking

September 27th, 2017 at 3:11 PM ^

This is a big deal. Major stuff only ever gets uncovered because actual laws are broken. Giving some cash to a kid isn't illegal, it's just against NCAA rules. The cops and feds can know about it and not care, because to them it is the same as me giving cash to a teenager who mows my lawn.

But when laws are broken, especially federal ones, the heavy artillery rolls up in the form of subpoenas and such. (See also: Ed Martin, Miami football, Reggie Bush in the form of a lawsuit, BALCO, Lance Armstrong, etc) People are compelled to be forthcoming and truthful in a way that a toothless NCAA investigation never prompts. And people will flip on each other to save their own necks from jail, rather than stay quiet because the NCAA can't do anything if they don't talk.

That they're going after a heavy-hitting AAU league is significant. That they've already implicated assistants at mid-rung (Auburn and Oklahoma State have good years, but they're not powers!) basketball programs is significant.

This could, easily, become the biggest scandal in the history of college sports.

And given how dirty we think the sport is, I hope it is. 

ypsituckyboy

September 27th, 2017 at 3:33 PM ^

not to be nit-picky, but i can almost guarantee you that laws ARE broken when boosters give cash to a kid. i'm no accountant, but i'd be willing to bet that those kids and their parents don't declare it on their tax returns properly and the shoe companies know it so they may be liable too (i.e. you have gift tax exceptions, but the shoe companies probably have to treat it not as a gift but as some kind of bonus/incentive, and the kids don't declare the income).

stephenrjking

September 27th, 2017 at 5:50 PM ^

I get that, but the cash is often small time, and the some of the gifts are legal, and some other transactions are loans (Webber repayed a significant loan to Ed Martin, for example). At any rate, small time enough that the Feds have yet to get involved. Plus, certain activities like paying someone else's rent might not exactly violate tax law (though mgoaccountants and mgolawyers can speak better to this). 

The upshot is that the corruption aspect is a much bigger deal. 

LSAClassOf2000

September 27th, 2017 at 3:07 PM ^

This is very quickly getting to a point where I think several programs that are right now consistently good may suffer some serious down seasons - not everyone, but I bet a few do when all this is done. Who knew that to get the strangest touranment field ever that it would take a wide-reaching FBI operation, right? 

denardogasm

September 27th, 2017 at 3:35 PM ^

Yeah if anyone really wanted to it would be just as easy to dig up dirt on the entire SEC football machine as it was to figure out this bball thing. This bball investigation has clearly been going on for a while though and just was published, so we can only hope there's a similar investigation on the football side. Doubt the cheating would reach the FBI level though since the apparel companies aren't as involved.

username

September 27th, 2017 at 4:33 PM ^

Could someone more familiar with all of this explain how the payments actually work?  The idea of a booster handing a recruit or player a "bag of cash" seems easy.  Assuming the money is coming out of the booster's own pocket, he doesn't need to explain it to anyone.

But this isn't boosters - it's Adidas (and maybe Nike).  When I worked at larger companies, getting a stupid bag of M&M's from the mini-bar through my expense report was damn near impossible.  How do you go about explaining a $100K expense?

It would suggest to me that maybe there is a cover arrangement at these camps to facilitate the payments.  Are parents hired as "guest speakers" or "camp coordinators" and paid by check? 

Or is it as blunt as the Adidas rep showing up in the locker room with an envelope stuffed with $100 bills?  If the latter, not only are the marketing guys at Adidas in on it, but it seems like there'd have to be a few people on the finance side in the know.  And we know about a few hundred thousand dollars of payments.  The aggregate of these payments is likely a million-dollar-plus per year line item.  That typically doesn't just slide through without explanation to people more senior.

Aside from seeing dirty coaches/programs get what they deserve, I'm curious to understand the mechanics of all of this - that may be the playbook that the FBI referenced.  I think this is why I flew through the 10 episodes of Ozarks.  You have to be creative to get large sums of dirty money through the "system."

 

username

September 27th, 2017 at 5:33 PM ^

A great new article on ESPN:

 http://www.espn.com/mens-college-basketball/story/_/id/20834050/the-story-how-fbi-brought-words-corruption

"During the July 10 call, the FBI alleges the men discussed a plan in which the undercover agent and Sood would front the money for the first $25,000 payment because it was going to be difficult to mask the payments through Adidas' accounts payable system. Dawkins assured Sood and the undercover agent that they'd eventually be reimbursed by Adidas. Dawkins told them they were paying the player's family so the player would sign with Dawkins and his fledgling agency, as well as an endorsement deal with Adidas, when he turned pro."

and

"Code further explained that by funneling the payments to players' families through third parties, Adidas "was not engaging in a monetary relationship with an amateur athlete. We're engaging in a monetary relationship with a business manager, and whatever he decides to do with it, that's between him and the family. ... We can't get involved directly in those kinds of situations and scenarios."

 

 

BlueMk1690

September 27th, 2017 at 5:38 PM ^

of some sort are usually involved. It's the kind of thing where it all looks pretty random until you flip someone who has the key.

No-one in a sports apparel company's accounting department would bat an eyelid if the marketing department spent 100k a year to sponsor youth basketball orgs in NYC. These companies have their fingers in youth sports everywhere and it's quite common for them to mix 'community outreach' with marketing (and it's not illegal in itself either).

username

September 27th, 2017 at 6:12 PM ^

The article linked above does mention how Adidas was funnelling some payments to families through an AAU organization.

The seeming ease of these conversations suggest to me that what the wiretaps picked up was very routine for the people involved.  If I was doing something like this for the first time, I know I'd be nervous about covering my tracks.  Not these people - this was just everyday business.