NFL Player's Association Financial Registration Program
NFL Player's Association Financial Advisors Registration Program
The NFL Players Association's Financial Advisors Registration Program is a program that will provide NFL players with access to a list of financial advisors who are deemed qualified by the NFLPA[1]. Advisors must apply to the program and go through a full background check before being added to the list. Players can ultimately choose any investment advisor that they would like to work with, sports agents can only recommend registered advisors on the list.
Responsibility of a Financial Advisor
A financial advisor is a professional who works on behalf of an individual and provides them with advice to help them reach their financial goals[2]. Some of their responsibilities include but are not limited to: understanding the financial markets, creating budgets, saving for retirement, tax planning, and building portfolios. Additionally, the financial advisors registered in the program have a fiduciary duty to their clients, meaning that legally, they must put their clients interests first and represent clients objectively[3].
Creation of the NFLPA Financial Advisors Registration Program
The NFLPA established the Financial Advisors Registration Program in 2002, with the goal of protecting players from investment schemes. The NFLPA website states that the “idea for the Financial Advisor Registration Program came from the players themselves.[3]” Many players come into the league at a young age, are uneducated and inexperienced financially, and therefore, can easily be targeted by scammers. The Financial Advisors Registration Program aims to eliminate this risk, and provide players with advisors and agents who are pre-screened by the NFL.
Application Process
The initial fee during application is $2,500. This consists of a $2,000 application fee and $500 for the first year of membership[3]. If the advisor does not get approval to join the list, the $500 membership fee will be refunded. To apply for the program, an advisor must have a number of qualifications; these include but are not limited to:
| 1 | Bachelor's degree from an accredited university. |
| 2 | Every Applicant shall be a CERTIFIED FINANCIAL PLANNER™ (CFP®) and/or a Chartered Financial Analyst® (CFA). An individual who is currently a Registered Player Financial Advisor, but is not a CFP® or CFA must become compliant within three years of implementation of this Regulation, which is November 1, 2017. |
| 3 | Minimum of eight (8) years of licensed experience (qualifying licenses include FINRA series licenses, Attorney, CPA or an insurance license). |
| 4 | Fidelity bonding and professional liability insurance coverage as indicated in Section Two II D of the Regulations. |
| 5 | No civil, criminal or regulatory history related to fraud. |
| 6 | No pending customer complaints or litigation at the time of application. |
| 7 | Must not maintain custody of player funds unless deemed a qualified custodian |
History of Fraud in the NFL
Between 1999 and 2002, at least 78 NFL players had been defrauded of more than $42 million[4]. This loss was a total of many investment schemes intended to target misinformed athletes.
William “Tank” Black.
Black was one of the most prominent sports agents in the late 1990's, and had signed a number of pro athletes during his time. He was accused of many investment scams including money laundering. During his career, Black sold certain stocks to his clients that should've been given to them for free, and sold them at higher prices than their market value. He was also found to be paying college athletes in cash. Eventually, the more clients he acquired, he was able to spend more on recruiting more clients, and therefore always had a growing amount of cash at his disposal. He eventually scammed pro athletes of approximately $15 million[5].
Kirk Wright
Wright, a hedge fund manager, was an approved advisor on the NFL's list. He hired an ex-NFL player as a consultant to his firm, and used him as a means to attract NFL players as clients[4]. When his business collapsed, Wright was charged and convicted of 47 counts of fraud and money laundering. Wright gave clients statement which showed that their investments were worth up to 1000 times more than their real value[6]. Seven NFL players who were involved in this scheme lost about $20 million.
The goal of the NFL’s Financial Advisors Registration Program is to protect players from these schemes, but there are still many cases involving advisors defrauding professional athletes.
For more information, please visit https://www.nflpa.com/financial-advisors/faq
- ^ "NFL Players Association - Financial Advisors Application and Renewal". www.nflpa.com. Retrieved 2019-10-17.
- ^ "Financial Advisor - Overview, Roles and Responsibilities, Salaries". Corporate Finance Institute. Retrieved 2019-10-17.
- ^ a b c d "NFL Players Association Regulations and Code of Conduct" (PDF). nflpaweb.
{{cite web}}: CS1 maint: url-status (link) - ^ a b Landsman, Laurence. "Financial Fraud Is One of the Biggest Off- Field Challenges to NFL Players" (PDF). law.marquette.edu.
{{cite web}}: CS1 maint: url-status (link) - ^ Yaeger, Don; Schecter, B. J. "Web of Deceit Smooth-talking agent Tank Black allegedly ensnared nearly two dozen NFL and NBA players, including Vince Carter, in a mind-boggling series of scams and defrauded them of some $15 million". Vault. Retrieved 2019-10-23.
- ^ Horowitz, Carl (2008-06-16). "Atlanta Hedge Fund Manager Found Guilty, Kills Self". National Legal & Policy Center. Retrieved 2019-10-17.