Interesting article in the San Fransisco Chronicle:
A TEMPTING BUSINESS Agents impossible to evade for top collegians and their families
Tom FitzGerald, Chronicle Staff Writer Sunday, October 21, 2007
(10-20) 18:55 PDT -- When Cal receiver DeSean Jackson says, "They've been trying to catch me but I've been trying to hide from them," he's not talking about opposing tacklers.
He's talking about sports agents.
His former teammate, running back Marshawn Lynch, who plays for the Buffalo Bills, often found himself being followed on his way to class last year by young men who looked like students. They wore backpacks, but there were no books in them. That's because the men were "runners," and their mission was to try to steer Lynch to the agents who employed them.
Sports agentry can be a lucrative business. NFL teams have never been more profitable, and salaries have skyrocketed. So have the 3 percent commissions the agents make for negotiating player contracts and the 15-25 percent commissions they make on players' endorsement deals.
Despite the efforts of the NFL Players Association to eliminate bad apples and despite the efforts of schools and the NCAA to keep agents away from juniors, the competition among agents to land players - particularly those such as Jackson who figure to be high draft choices - is ferocious.
"Intense is a mild word to describe it," said Rachel Newman Baker, the NCAA's director of agent, gambling and amateurism activities. "This is an extremely competitive industry."
Rookie 49ers linebacker Patrick Willis said that two years ago, when he was a junior at Mississippi, an agent offered him $75,000 if he would sign with him. Willis said, "This was straightforward. He said, 'This will be yours to play with.' "
Patrick Lynch, Marshawn's cousin and mentor, said, "One guy told us, 'I've got a great house in Mexico (Marshawn) can use 'cause I like him so much.' Another guy said, 'He really should be driving a Hummer.' They think you're gullible. They put this shiny apple out there, and they want you to bite it."
The parents of 49ers quarterback Alex Smith were inundated with sales pitches from agents. Then there were the financial advisers, one of whom told them, "there was no reason to pay all these taxes" when so much money could be stashed in the Cayman Islands.
Most NFL players are represented in contract negotiations by reputable sports agents - mostly from large firms - who have established themselves over years of working for other players. Last year, 60 percent of the players were represented by 17 percent of the agents.
Then there are the wannabes. New agents join the fray every year to compete for college players, especially the stars like Cal's Jackson and Justin Forsett.
Players are not allowed to commit to agents, either in writing or verbally, until their college eligibility is up. Last spring, in an effort to take some of the pressure off non-seniors, the NFLPA ordered agents not to contact players until the year before they're eligible for the draft. For players who have redshirted a season, that's their junior year. Otherwise, they have to be seniors.
Such rules haven't stopped nonredshirt juniors like Jackson and their parents from being flooded with mail and phone calls from agents touting their services.
"I get a lot of calls, but I just send them and the e-mails to my parents," said Forsett, a senior running back. Agents or their runners "have been around at games but I haven't seen them (elsewhere) on campus. I can do without all that."
His father, Rodney Forsett, a nondenominational minister from Arlington, Texas, said the agent crush hasn't been bad so far - "I call it being blessed" - but he expects it to get worse toward the end of the season.
"I'm a straightforward guy," he said. "I tell them, 'If you cross these lines, you're eliminating yourself. I'll get with you when the time is appropriate.' I'm hoping (the agent) will be somebody the Lord sends to us, a person who will gravitate to Justin and enhance who he is as a person. That's the type of person we're looking for."
Jackson is a junior, but he is widely expected to enter the NFL draft in April. Agents know that, and, NFLPA rules notwithstanding, they're eager to reach out and touch him.
"Definitely over the summer, a lot of agents tried to talk to me," Jackson said. "I'm just focusing on my season. I'm not worried about that. ... There are a lot of things agents do to send people at you. Some people have my phone number; I don't know how they get it. They'll call me out of the blue."
His father, Bill Jackson, a retired bus-company manager from Los Angeles, empties his post office box a few times a week, and he said each time it's "jammed with mail from agents." Agents may not be calling him, but their runners sure are.
"I get five phone calls a day," he said. "I don't tell them to call back. I usually tell them, 'Have a nice day,' and hang up on them. You have to, or else you'll go crazy."
DeSean Jackson said there's "a huge possibility" he'll turn pro before the April draft, but Bill Jackson said he hopes he stays in school. "DeSean goes to one of the great institutions in the country, and I hope he stays and gets his degree. If he comes out, I hope he goes back and graduates. The NFL stands for 'Not for Long.' "
Cal coach Jeff Tedford said his program gives players and their families the rules and information on how agents work.
"You have to have trust in the players," he said. "There's nothing (agents) can do for you during the season except get you in trouble.
"We send out letters to the parents. It's equally important that they understand the ramifications of getting a cup of coffee from an agent. Even a cup of coffee is not legal."
The family of Saints running back Reggie Bush allegedly took a lot more than a cup of coffee while he played at USC. Sports marketers Lloyd Lake and Michael Michaels say they gave Bush's mother and stepfather the use of a suburban San Diego home on which the couple later failed to pay $54,000 in rent. The allegations, originally reported by Yahoo.com, became public after Bush signed with another marketing group, which also is accused of giving Bush improper financial benefits.
If NCAA investigators find the allegations are true, USC could be forced to forfeit games, and Bush's 2005 Heisman Trophy could be in jeopardy. Bush repeatedly has said that neither he nor his family did anything wrong.
Many universities do their best to weed out undesirable people by requiring agents to check with the schools before approaching players. "The number of people pretending to be agents has increased," the NCAA's Baker said. "Our membership - presidents and athletic directors - are very concerned about this."
Improper offers are often couched in vague terms, making it difficult to punish the agents who make them. "It's up to the kids and the schools to report them," said Mark Levin, the NFLPA's director of salary cap and agent administration. "That's the only way we'll find out about them. Usually, the school is left in the dark, too. It's been very difficult for us to get evidence of improper inducements. Obviously, it's a problem. Everybody knows it goes on."
Being an agent is a cutthroat business. Even the legitimate ones with long lists of clients badmouth each other with gusto. Some agents, especially those on the fringe, make bold and sometimes illegal promises to players and their families. They cozy up to friends of players, sometimes seeking the players' cell-phone numbers, sometimes seeking more help and offering money for it.
Sometimes it's a player or a family member or friend who sets a price on a player's willingness to sign. "I got a call a week ago on a certain player from an East Coast school," said Angelo Wright, an agent from Hayward who represents 14 NFL players. "If I gave $10,000, he'd deliver the player to me. I told him I don't do business like that."
Based on interviews with several established agents, it appears that it's inexperienced agents and their runners who are more apt to cross the line.
"The potential for abuse is there," San Francisco agent Steve Baker said, "but, frankly, I think the system self-corrects, and those people are run out of the business."
Wright agrees. "The new guys tend to be overzealous in getting players. After a few years, players realize that just because somebody takes them to a concert to meet Snoop Dogg, that's not going to help them in business."
What's at stake is a piece of NFL incomes that range from sizable to colossal.
Former LSU quarterback JaMarcus Russell's six-year deal with the Raiders is worth $61 million, some $32 million of it guaranteed. If the deal pays out in full, agents Ethan Lock and Eric Metz will collect more than $1.8 million from one client, assuming they get the maximum 3 percent allowed by the NFL Players Association. They'll also get a much bigger slice of whatever endorsement deals they cut for him. Because he plays a high-profile position, those deals figure to be lucrative.
Russell was essentially delivered to Lock, Metz and their firm, LLM, by former University of Miami and NFL running back Melvin Bratton, a highly successful "runner" who twice failed the agent test required by the NFLPA.
"He brought me to those guys, and I met them and built a relationship with them," Russell said. "You're putting your life in their hands. Once we sat down with them, my mom thought they were the kind of group for us."
Bratton has since become vice-president-football operations for a new athlete/entertainer representation firm headed by former 49ers owner Eddie DeBartolo.
Before deciding on Lock and Metz, Russell said, the crush of agents on him "was like being recruited all over again." Maybe it was worse, he said, "because people have your phone number and you're trying to figure out who they got it from. It was kind of a scary deal."
Other NFL players interviewed said the barrage of phone calls was even more intense than the recruiting process in high school.
"I was getting calls at 1 in the morning," said rookie offensive tackle Joe Staley of the 49ers, a first-round pick from Central Michigan. "People were calling from the West Coast and didn't realize the time difference. It was intense at first, and I knew it would get ridiculous as my draft stock rose. And it did."
Vernon Davis, a tight end from Maryland who was a 49ers' first-round selection a year earlier, said, "I'd come home from a game and these guys would be around. I wouldn't answer my phone, but I knew who it was."
He received cash offers but told such people he'd talk about money when the time was right, he said.
The process can be overwhelming even when people are playing by the rules. Few players are financially sophisticated enough to know the right questions to ask prospective agents, and most of their parents don't have the resources to research the process thoroughly.
One couple who did was Doug and Pam Smith.
"My parents did a great job of letting people know that if they contacted me directly, they'd be out of the mix," said Alex Smith, the No. 1 overall pick in the 2005 draft.
During Alex's sudden rise to prominence in Utah's unbeaten 2004 season, the Smiths took a crash course in the agent business before signing with Tom Condon, who negotiated Alex's six-year, $49.5 million contract with the 49ers. Condon represents 11 starting NFL quarterbacks. "It couldn't have worked out better," Pam Smith said.
Yet it was an ordeal to do all the research and take all the strange phone calls. "For all the good people," she said, "there were also a bunch of sharks."
There have been so many posers in the business that the NFLPA had to set up obstacles for them. All agents have to be certified by the association, which requires applicants to take a three-hour, open-book exam to test their knowledge of the collective-bargaining agreement, the salary-cap structure, player rights and agent regulations. The pass rate for the most recent exam was 70 percent, according to the NFLPA.
Once they pass the test, agents have to acquire personal liability insurance (a minimum annual premium is $2,000) and pay an annual fee of $1,200-$1,700. They have to attend one of three annual agent seminars around the country. An agent who hasn't done an active player contract in three years is automatically decertified.
Last year, the NFLPA established a further requirement: a postgraduate degree. Curiously, the degree doesn't have to be in a field related to finance. The idea simply was to weed out some of the frauds.
"That was great for us," said agent Doug Hendrickson of Octagon Football, a Walnut Creek-based firm that represents 50 NFL players, including Marshawn Lynch. "It helped get people who want to do this as a hobby out of the mix."
The added requirements have pared the ranks of certified agents from a peak of 1,400 a decade ago to about 800. Most of them don't have a single client. But each year brings 250-300 new applicants, according to the NFLPA's Levin. More than 100 agents have been disciplined over the last 10 years for rules violations, he said. Some received reprimands; others had their certification suspended or revoked. Meanwhile, many agents allow their certification to lapse because they can't find clients.
Still, hundreds of newcomers try each year. Meanwhile, the runners - some of whom work for the large, established firms - don't have to be accredited, although the agents who employ them are liable if runners step over the line.
"There are very few people who make it in this business," said Bob LaMonte, who got out of the player-representation field 20 years ago but still has 36 coaches and general managers as clients. "To get a first-, second- or third-round pick, you've got to spend $100,000 for travel, expenses and the runners you have to pay, plus accreditation. It takes a corporate kind of commitment."
Then there's no guarantee that the agent/player relationship will last. Jason Hill, a rookie 49ers wide receiver from Washington State, already has fired one agent, Ralph Cindrich, and hired another, Drew Rosenhaus. "Things weren't going the way I expected," Hill said.
According to Hill, the process of finding an agent "is kind of like dating a girl. In the beginning, she'll tell you anything, do anything. As you go on, you live and learn. Unfortunately, I had to go through that and break up with a 'girlfriend,' so to speak, and hire someone else."
His advice to potential pro players is this: "Take your time. A lot of guys are quick to jump when they hear something they want to hear. Sometimes you've got to sit back and hear the things you don't want to hear."
For information on NCAA rules regarding sports agents, go to ncaa.org. Under "Legislation & Governance," click "Eligibility & Recruiting," then "Agents & Amateurism."
Money on, or under, the table What players can get: The offers are seemingly endless, including cash (49ers rookie Patrick Willis said he was offered $75,000 two years ago), cars and even homes.
What agents can get: The agents for No. 1 pick JaMarcus Russell stand to earn $1.8 million off his Raiders deal, assuming they get the maximum 3 percent commission, plus 15-25 percent on endorsements.
Agents' Hall of Shame By all accounts, established sports agents generally play by the rules in their efforts to win clients. Some agents have crossed the line, and here are a few of the most notable cases:
Norby Walters and Lloyd Bloom
In 1984, Norby Walters and Lloyd Bloom set out to sign as many future NFL draft picks as possible. A prospective client typically was offered a lump sum ranging from $2,500 to $4,000 and a $250 monthly allowance. Other perks included airline and concert tickets, clothing and cars.
After spending an estimated $800,000, they signed 58 players to postdated contracts. Clemson running back Ronnie Harmon admitted he accepted more than $54,000 from Walters, including a $25,000 down payment on a leased Mercedes-Benz.
Partly because of the agents' rumored ties to organized crime, all but two of the players eventually signed with other agents and refused to reimburse Walters and Bloom. There were allegations that Walters and Bloom threatened bodily harm to players who breached their contracts.
Walters sued some of his former clients for breaching their agreements and began revealing his dealings with the players to the media. He and Bloom were charged with conspiracy, racketeering and mail fraud. A jury convicted them, but the convictions were reversed on appeal. Bloom was shot to death in his Malibu home in 1993.
In 1993, Detroit Lions safety Bennie Blades said he and five other starters on the Miami Hurricanes' 1987 national championship team, including his brother Brian and wide receivers Michael Irvin and Brett Perriman, had received tens of thousands of dollars in illicit payments from sports-agent Mel Levine. Levine wound up representing all six players - until he filed for bankruptcy in 1991 and pleaded guilty to 12 counts of federal bank and tax fraud.
Raul Bey, a Las Vegas businessman, and his "runner" Nate Cebrun, lavished cash on Florida State football players in 1993. They passed out hundred-dollar bills and promised regular allowances to those who agreed to deals.
They also took a group of them to a Foot Locker store as it was about to close. With only Bey, Cebrun and the players behind the locked doors, the players grabbed $6,000 worth of merchandise. Bey footed the bill and later treated some of the athletes to a $600 dinner.
Bey and Cebrun had a falling-out, and the players lost interest. Bey was left with nothing to show for the $60,000 he claimed to have spent on the recruitment effort. FSU athletic director Bob Goin said the athletes and the university were victims of "the sleazebags who filter onto our campus." Florida coach Steve Spurrier quipped that FSU was "now known as Free Shoes University."
In 1995, Bey pleaded no contest in a Florida court to a charge of failing to register as a sports agent and agreed to spend one year in prison, pay a $2,000 fine and reimburse the state for $10,000 in investigative costs.
One of the most egregious cases of an agent giving under-the-table payments to college players was unearthed because the agent later swindled clients such as NFL players Fred Taylor and Ike Hilliard out of more than $11 million. At one point, Black had more then 35 NFL players as clients; in the 1999 draft, he had five first-round picks.
Three former Florida football players testified Black paid players in cash, often through "runners." One of those players was defensive end Jevon Kearse, now with the Philadelphia Eagles, who declared for the draft after his junior year and signed with Black, only to fire him a month after the draft in the wake of a criminal investigation into Black's activities. In 2002, Black received a five-year sentence for fraud.
- Tom FitzGerald
Top agencies The top firms in terms of most active NFL players represented: (Rank, Agency, Top agents, No. of players)
1 Creative Artists Agency; Tom Condon, Ben Dogra, Jim Stiner; 115 2 Rosenhaus Sports Representation; Drew and Jason Rosenhaus; 91 3 Sportstars; Alan Herman, Brian Mackler; 82 4 Priority Sports; Mark Bartelstein, Rick Smith, Mike McCartney; 73 5 All-Pro Sports & Entertainment; Lamont Smith, Peter Schaffer; 69
Source: NFL Players Association
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