By Ross Evans ’20<\/b><\/p>\n
Editor\u2019s Note: In light of the March 6th sentencing of the defendants in United States v. Gatto (the first NCAA hoops corruption trial), we wanted to share a piece\u2014written by our managing editor (Ross Evans \u201920) and published on The Global Anticorruption Blog (GAB) in January\u2014that argues the federal government\u2019s successful prosecution in the case does not necessarily represent a positive development for anticorruption efforts overall. We re-publish it here with permission from the GAB.<\/i><\/p>\n
From the\u00a0U.S. federal government prosecuting FIFA officials<\/a>\u00a0in New York City to Transparency International both announcing an\u00a0organizational initiative on sports anticorruption<\/a>\u00a0and publishing a\u00a0398-page report<\/a>\u00a0on the topic, it seems clear that governments and NGOs alike have deemed sports corruption a high priority. One can debate whether sports corruption is sufficiently important to merit this level of attention, though there\u2019s a case to be made (as Lauren Ross\u00a0argued on The Global Anticorruption Blog<\/a>\u00a0a few years back) that sports\u2019 broad appeal, media coverage, and status as a symbol for fair competition together give anticorruption efforts in sports an importance that exceeds the direct social harm caused by, say, match fixing relative to other forms of corruption (like medicine theft). That said, just because there may be special value to sports-related anticorruption initiatives in general doesn\u2019t mean that all legally viable sports-related anticorruption enforcement opportunities should be pursued. Indeed, over-emphasizing sports can lead to a dubious allocation of government resources, a problem illustrated by a recent US case (United States v. Gatto<\/em>) in which several defendants were\u00a0convicted<\/a>\u00a0for their roles in a college-basketball bribery scheme.<\/p>\n To understand the\u00a0Gatto<\/em>\u00a0case, it\u2019s important first to understand the underground economy for student-athletes. In the U.S., the non-profit National Collegiate Athletic Association (NCAA) governs the\u00a0$13-billion college sports industry<\/a>, with most of the NCAA\u2019s revenue coming\u00a0from men\u2019s college basketball<\/a>. (If men\u2019s college basketball programs could be bought and sold like professional sports franchises, the most valuable\u00a0would be worth $342.6 million<\/a>.) Critically, however, because of the\u00a0NCAA\u2019s amateurism rules<\/a>, the student-athletes whose talent drives this industry can neither receive compensation from their universities (beyond cost-of-attendance athletic scholarships), nor earn money through endorsements, autographs, jersey sales, or any other monetization of their\u00a0name or likeness<\/a>. The value generated by the unpaid players is captured by others in this system, such as head coaches (who are the\u00a0highest-paid public employees in 39 out of 50 states<\/a>),\u00a0NCAA executives<\/a>, and\u00a0university athletic directors<\/a>. Given this system, it\u2019s altogether unsurprising that top high-school basketball prospects often receive compensation for attending a given university via an underground economy. The corruption scheme at issue in\u00a0Gatto<\/em>\u00a0was a particularly egregious example of this underground economy in action: Employees at an athletic-shoe company (Adidas), which sponsors a number of men\u2019s college basketball programs, conspired with assistant coaches at those programs, and with an aspiring talent agent, to bribe elite high-school basketball prospects to attend the Adidas-affiliated universities. This deal looked to be win-win-win-win. The athletes benefited because they received compensation that better reflected their market value. Adidas benefited both from having elite college-basketball players wearing their brand on national television and from the increased probability that some of these players would sign an endorsement deal with Adidas if they turned professional. The universities profited from the\u00a0economic windfall associated with enrolling an elite basketball prospect<\/a>. And the aspiring talent agent boosted his odds of being formally retained when the player turned professional.<\/p>\n Nonetheless, this scheme was technically illegal, and so the jury was analytically correct in convicting the defendants at trial. But just because the defendants broke the law doesn\u2019t mean that the prosecutors should have brought the case. Indeed, this case is one where, for three policy-related reasons, it would\u2019ve been better if the U.S. Department of Justice hadn\u2019t gotten involved:\u00a0Continue reading on The Global Anticorruption Blog\u00a0