Task Force to Big-Money Boosters: NIL Sanctions Could Be Coming

SCOTTSDALE Ariz.—College leaders are gearing up to issue a warning to hundreds of wealthy boosters who are using name, image and likeness (NIL) ventures to involve themselves in recruiting.

University administrators, part of a task force to review NIL, are finalizing additional guidelines that are expected to clarify that boosters and booster-led collectives are prohibited from involvement in recruiting, multiple sources tell Sports Illustrated. The guidelines will provide more guidance to member schools on what many administrators say are NIL-disguised “pay for play” deals orchestrated by donors to induce prospects, recruit players off other college teams and retain their own athletes.

The new directives will highlight existing NCAA bylaws that outlaw boosters from participating in recruiting, reminding member schools of guardrails that, while in place for years, have been bent and broken during the first 10 months of the NIL era, officials say. Under a long-held NCAA rule, boosters are a representative arm of an athletic department and are not supposed to associate with or persuade prospects.

The guidelines, still in draft form, outline that booster-backed collectives should be prohibited from associating with high school prospects and college transfers, potentially opening the door for contentious legal challenges between the association and booster groups.

Schools that do not control their donors’ spending could be found to have violated NCAA rules and will be sanctioned, according to the document. The NCAA enforcement staff have made inquiries only into a small handful of programs so far, but the guidelines could spark deeper investigations into improper inducements tied to NIL payments.

“We let things get out of hand,” says one official with knowledge of the guidelines. “We have to get [the boosters] out of contacting recruits and bartering with them.”

A new NCAA working group tasked with reviewing NIL spent the past month creating the multipage document of guidelines, an addendum to the organization’s interim NIL policy released last summer. The guidelines are being rushed through the NCAA governance system and could be approved within a week’s time, sources say. They are expected to be the first of what could be ongoing clarity from leadership about the new and complicated space.

The draft of guidelines is being circulated this week in Phoenix, where more than 200 administrators and coaches from at least four conferences hold their annual spring meetings. The administrative council of the NCAA Board of Directors meets Monday, at which point they can rubber stamp the draft.

In a seminal chapter in a seismic moment for college sports, the recommendations and potential subsequent investigations could have sweeping impacts on the current landscape, where individual donors (directives) and groups of donors (collectives) have been communicating with prospects or their agents to arrange NIL deals. Sports Illustrated spoke to more than two dozen college sports stakeholders over the past six months for a wide-ranging story that revealed the unregulated, high-priced bidding wars for college football and men’s basketball players.

NIL has paved an avenue for boosters to get involved in recruiting by striking five-, six- and seven-figure deals with athletes to either endorse their own businesses or seek commercial opportunities from a collection of donors. The NCAA’s interim policy, vague in nature, requires a quid pro quo (or exchange of work) and payment for performance or enrollment. Schools in states with laws governing NIL operate under such laws, most of them with similar guidelines to the NCAA.

Experts believe more than 100 collectives exist, and thousands of deals have been struck with directives and collectives with some having already pooled more than $5 million in a pseudo “player salary pool” tagged for NIL. Boosters who spoke to SI say they have proof they are in compliance with their state laws governing NIL and/or the NCAA’s interim policy.

Some boosters and collectives are managed by platforms such as Opendorse that ensure they remain in compliance by tracking all athlete deals. Others are managed by sports agents and savvy attorneys who have kept documentation of their communications and quid pro quos.

The donor who has drawn the most scrutiny is John Ruiz, a lawyer in Miami whose payroll includes more than 100 Hurricanes athletes across a variety of sports. He expects to spend $10 million this year to have South Florida players endorse his two companies, LifeWallet, a healthcare application, and the Cigarette (boat) Racing Team. About 10 days ago, Ruiz used his own Twitter account to announce that Miami received a commitment from Kansas State transfer guard Nijel Pack and that he, Ruiz, signed the hoops star to a two-year deal for $400,000 a year. Ruiz tells SI he communicates with player agents to arrange deals, but he is in compliance with state law.

“We feel our platform is the only one in the country that truly would be resilient to any attack by the NCAA, because we do have a quid pro quo,” Ruiz told SI. “The payments are made electronically to them every two weeks. It’s a pretty well-oiled machine.”

The real challenge for the NCAA is controlling an issue that is governed by laws in at least 30 states, potentially offering protection to boosters and collectives in their involvement with recruiting.

“In recruiting, we have inducements created, which was a concern all along,” SEC commissioner Greg Sankey said in an interview with SI earlier this spring. “You’ve seen the stories. I don’t know that many have been actually verified. Now people have time and creativity and motivation to fully explore NIL and that is very uncomfortable in college athletics, but as long as it is compliant with state law, it seems those activities can take place.”

College leaders are beginning to speak out publicly about the situation, airing their frustrations over an NIL concept that has quickly evolved from its original intent of star athletes sponsoring a local business to crowdfunding models doling out four- and five-figure payments for appearances.

“Everybody wants to hide under the NIL umbrella. This isn’t NIL,” Colorado AD Rick George told SI last week. “As the leaders of the industry, we have to say, ‘This is not acceptable.’”

“The only ones getting penalized are the ones trying to follow the rules,” said Todd Berry, the executive director of the American Football Coaches Association. “If a booster decides it’s worth $100,000 for a player to have a 30-minute autograph signing, and you say he can’t do that, I don’t know if that’s going to fly in the courts.”

Soon, we just might find out.

Any NCAA enforcement will challenge state NIL laws and risk a bevy of lawsuits from the wealthy collectives and individual donors, experts say.

“Either you let everyone do it or you enforce the rule,” Florida-based sports attorney Darren Heitner says. “In essence, what’s happening or will happen is those who are willing to violate the rule will be rewarded if nothing is done about it. Don’t have a rule if you’re not willing to enforce it. This isn’t a matter of them not being able to do something. But will it further open itself up to more litigation, litigation it will probably lose?”

Thus far, the NCAA has avoided enforcement, perhaps because of the threat of legal challenges. But things are at a boiling point, and leaders feel they have lost control. They are now willing to take a risk they weren’t last summer, when the organization tabled a permanent policy governing NIL after the loss in the Supreme Court-Alston case. A group of athletic directors spent two years drafting the policy to see it abandoned at the last minute. Several officials have expressed regret in the NCAA’s decision to eschew the policy.

The guidelines, if and when approved, will finally answer the questions asked to NCAA officials by school compliance staffs for months now. Can a booster-led collective interact with prospects or induce prospects? No, the guidelines will say.

“These collectives and booster groups, all of the people involved with them would be considered representatives of athletic departments,” says Big 12 commissioner Bob Bowlsby, who was part of the group that drafted the abandoned policy. “Our proposal included a provision that the school couldn’t be involved in match making the deals and putting student-athletes on deals and to avoid inducements on student enrollment and transfers.

“Seems to me we would have been infinitely better off had we gone ahead and implemented the guardrails,” he says. “At least we would have provided some guidance.”

The NCAA sent letters of inquiry to at least two schools, Miami and BYU, but is not believed to have generated any full-scale investigation or enforced its own bylaws prohibiting boosters from being involved in recruiting. In an interview with the Associated Press in January, NCAA vice president of enforcement Jon Duncan said the organization did not plan to enforce the interim NIL policy, but was “looking at rules that are still on the books” and behaviors that could be violations.