How latest federal charges underline the biggest issue in fixing college hoops

In a couple weeks, the NCAA’s “independent” commission, chaired by Condoleezza Rice, is scheduled to offer recommendations on the future of college basketball. While Rice has not revealed any hints at what the committee is thinking, much of the rhetoric from college sports leaders has pushed the blame on other entities: shoe companies, agents, the NBA age minimum.

There’s been, in some quarters, a doubling down on the status quo, a declaration the NCAA isn’t stringent enough in its rules and enforcement. There’s been calls for everything from the need to regulate agents, to making demands to the NBA, to even empowering enforcement like it was a private FBI.

“Consideration should be given for NCAA members to provide consent for subpoena power as part of their membership obligations,” Atlantic 10 commissioner Bernadette McGlade said, which would be, well, completely ridiculous.

The revelations last week from the U.S. Attorney’s Office in the Southern District of New York in adding three additional charges to former Adidas executive James Gatto ought to provide a stark reminder to everyone that the issue is as much, if not more, internal than external.

That included Gatto and Adidas allegedly doling out a $45,000 payment to a North Carolina State recruit, Dennis Smith Jr. That transaction, the indictment charges, came at the request of a Wolfpack coach so Smith wouldn’t back out of his commitment to the school. Gatto was charged with defrauding NC State, although how you can defraud a place when you’re acting at the behest of a key employee is an intriguing concept.

It also included Gatto being asked to help an unnamed but easily identified high school star, 6-foot-9 Silvio De Sousa, so that he would attend Kansas. The problem was that De Sousa, according to the indictment, “had received illicit payments in return for a commitment to steer the student-athlete to a university sponsored by a rival athletic apparel company.” De Sousa was considered by recruiting experts to be a near lock to attend Maryland, which is sponsored by Under Armour. In order for De Sousa to attend KU, his guardian, via an Adidas-sponsored AAU coach, was allegedly asking Adidas to “repay the [original] illicit payment.” Gatto allegedly approved. Later, there was an additional request for “‘another $20,000’ ” payment to get ” ‘out from under’ the deal to attend the [other] school.”

The NCAA is facing a monumental task in confronting the issue of how a young player’s free-market value runs counter to its current amateurism model. (AP)
The NCAA is facing a monumental task in confronting the issue of how a young player’s free-market value runs counter to its current amateurism model. (AP)

It could be a shoe company executive who is charged – including in one instance for engaging in a bidding war/buyout against another shoe company – but to blame this solely on shoe companies misses the point. Who invited the shoe companies into the process here?

The NBA’s one-and-done rule didn’t cause Adidas to be involved with Kansas or NC State (or Under Armor to be involved with Maryland). Neither did agents or financial planners or a lack of subpoena power. Kansas caused it. NC State caused it.

Once the schools cashed the checks – and they’ve been cashing them since the late 1970s when Sonny Vaccaro began signing college coaches for Nike – they became party to all of this. Kansas is in the process of agreeing to a 12-year, $191 million sponsorship deal with Adidas.

When you take nearly $200 million from someone, you work for them, not the other way around. It would be naïve to think Adidas, or anyone else, wouldn’t try to protect its investment by assuring the program has the best opportunity to win.

De Sousa was considered a very good recruit, maybe top 25 or 30 in the country, but a far cry from the top five that could truly make or break a team such as Kansas. He would go on to play 8.8 minutes a game this season, averaging 4.0 points and 3.7 rebounds for the Jayhawks.

He was also not considered a sure-bet “one and done” who would hit the 2018 NBA lottery (he hasn’t declared for the draft). As a power forward he fit no prototype that would lead any shoe company to think of him as a future endorser.

He was just a guy. Yet “just a guy” is worth that much money and that much work for multiple people because of his value to college basketball. The NCAA may say one thing. Its pocket book says another.

NBA draft rules would have no bearing on the De Sousas of the world. If the top 20 recruits all go pro, then Nos. 21-40 become the most valuable recruits to college programs and thus the most valuable to shoe companies who are eager to aid their investments in college athletics.

In another part of Gatto’s indictment, there is a quote from an intercepted phone call involving Adidas executive Merl Code discussing why Adidas was willing to allegedly pay $100,000 to the family of top recruit Brian Bowen so he would attend Louisville, which has a 10-year, $160 million deal with Adidas.

“You guys are being introduced to … how stuff happens with kids and getting into particular schools,” Code said on the phone to an agent and a financial planner. “And so, this is kind of one of those instances where we need to step up and help one of our flagship schools in [University of Louisville], you know, secure a five-star caliber kid. Obviously that helps, you know, our potential business.”

Anyone in college athletics who needs to be “introduced to … how stuff” happens hasn’t been paying attention. Regardless, they can’t claim to not know anymore.

Hopefully that includes Rice’s committee, which can’t just blame everything on everyone else. College sports can’t be the victim here, no matter how the U.S. Attorney is twisting things to make this illegal.

College basketball is its own multibillion-dollar business. It has its own motivations. Age rule or no age rule, tickets will be sold, television deals inked and coaches expected to win. The game was no less competitive or cutthroat before the age-limit rule when the best high schoolers went directly to the NBA. Just because LeBron wasn’t available, revenue, salaries and competition went up.

Rice has to know that there are no rules or regulations that can stop the wheels of capitalism. The free market will win in America, even if it must go underground. When a player like Silvio De Sousa is worth this, then there is no going back.

If Rice and her committee are serious about being more than just a NCAA smoke-and-mirror show, then it needs to deregulate.

Athletes need to control their name and likeness for endorsements or sponsorships big and small. It’s been happening that way forever in the dark. Might as well just bring it to light. If Adidas wants to stock Kansas with players, it will, whether the NCAA admits it or not. Innocent people are not dying because of it. If the local car dealer wants to try the same, then it will too, as it always has. Not even the FBI – or muscled-up enforcement staffers – can stop it.

The elimination of amateurism, as the International Olympic Committee did in the 1980s, solves almost all “problems.” Colleges aren’t paying players, they are allowing players to be paid.

Anything less – just adding rules – will do nothing, and “scandals” such as this will continue and continue.

On the surface, college sports would look different. In reality, as each of these indictments make crystal clear, it would be business as usual.

Rice was brought in to get the truth of the matter here. The NCAA will have to act on her recommendations or else look like it just used a big name for public relations.

When there is a shoe company bidding war on behalf of their college teams for Silvio De Sousa, reality is staring her right in the face.

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