“The sport most abused, by far, is basketball,” says Buoncore, himself a former NCAA Division 1 baseball player. “Part of it is the circumstances of basketball. There are five players on the floor at any given time, 10 to 15 active players on a team. At the higher levels, a huge spotlight is on these players. It’s literally rags to riches.”
Buoncore says that, because agents are not allowed to talk to basketball players until they’ve forgone their amateur status and declared for a professional draft, sports agencies are using financial advisors as the first point of contact for promising young athletes.
“There is no such restriction for a financial advisor,” says Buoncore. “I don’t know how prevalent it is, but sometimes the agents align themselves with advisors, and advisors are running clients for them under the guise of providing financial advice and preparation for a professional career. It’s an incestuous relationship.”
Buoncore says that shady agents have attempted to approach his firm about creating a pipeline for young amateur athletes to go pro.
“We’ve been approached by that, but it’s not what we do,” says Buoncore, who notes that his firm only gets involved with basketball players after they’ve declared their professional status. At the earliest stages, the work mostly revolves around budgeting and conservative investing to allow young clients to build sustainable wealth “in case, tomorrow, their knee gives out. Our philosophy has always been to first protect them from themselves.”
More commonly, advisors, agents, boosters and other interested parties will contact students via a friend or family member, says Sullivan.
Family and friends often surround the most promising athletes, eager to take part in the phenom’s success, advisors say.
“Imagine yourself as one of these star athletes in high school, or college, or even professionally,” says Buoncore. “Everyone they deal with feels as if they’ve been drafted as well. Everybody feels like they can ask them for $50,000 or $100,000 to open a restaurant or start a car lot or something else. They get picked apart because they don’t want to be the bad guy.”
Early in their careers, talented grade-school-aged basketball players participate in summer club teams organized by the Amateur Athletics Union (AAU). AAU coaches are often the longest relationship of a young athlete’s life, staying with them until a college choice is made and often influencing that decision. In basketball, most of the private AAU leagues are sponsored and run by major athletics apparel companies like Nike, Adidas and Under Armour, who all have an interest in cashing in on a player’s success after they’ve turned professional.
These apparel companies also sign large contracts with universities whose athletics programs use their products, creating a seamless stream of customers, clients and celebrity spokespeople from wunderkind child athletes, to NCAA student athletes, to young adult professional stars, Sullivan says.