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A third party can make for shady deals

One source says that agents depend on intermediaries much of the time in a process that is full of potential for breaking the rules.

July 13, 2008|Ben Bolch | Times Staff Writer

The process often starts with the same four words.

I got this kid . . . .

The phrase might come from a club basketball coach, a shoe company executive, a friend or a relative -- anyone who believes he can parlay his connection to a star player into a handsome payout.

How does it happen?

In an interview, a prominent agent described how so-called "runners" serve as intermediaries between top prospects and agents hoping to cash in when the player turns pro. The agent, who has represented several NBA players, spoke on condition of anonymity out of concern that his comments might be construed as an admission he had engaged in wrongdoing.

"Overwhelmingly, 95% of the time, there's a third party involved" in player-agent relationships, the agent said.

"If agents could get players in a fair, representative way without paying money they would, because everyone is a bottom-line businessman," he added. "But they can't."

Interest in how runners work recently piqued when a former associate accused Rodney Guillory, an L.A.-based events promoter, of accepting about $250,000 in cash and gifts from a sports agency and funneling them to basketball star O.J. Mayo before and during the player's one season on the USC basketball team. The allegations are being investigated by the NCAA, Pacific 10 Conference and NBA Players' Assn.

Payments to runners are made either directly or through yet another intermediary -- perhaps a real estate broker, car salesman, banker or financial advisor. There are advantages to each approach. The use of an intermediary provides the agent with plausible deniability, but direct payments leave less of a trail with fewer people involved.

The going rate for a runner, the agent said, is 1% to 2% of a player's estimated contract. For a $5-million contract, that would amount to anywhere between $50,000 and $100,000. An agent's standard 4% cut of the same contract would be $200,000.

Runners may also receive a percentage of the agent's cut of a player's shoe contract or other endorsements, which sometimes stretch into eight figures.

And in many instances, runners are paid without the knowledge of the athlete they are purported to be representing.

"Most of the time," the agent said, "the runner tells a kid, 'I'm just taking care of business so that we can do what we need to do.' "

There are no guarantees that a player will actually sign with a runner's agent even after payments have been made.

"Realistically, there's not much you can do" when that happens, said the agent, who estimated it plays out that way "at least" half the time.

"You're doing wrong, and when wrong doesn't benefit you, you can't get frustrated," the agent said. ". . . You can go tell a district attorney, 'I conspired with this guy to represent someone, and he breached the oral agreement.' Then they'll call you back . . . and the IRS and the FBI will call you back as well."

Runners affiliated with one agent will usually rebuff overtures from another agent trying to get close to their player. But not always.

"There's a whole group of runners who will go with whoever the agent is, as long as they get paid," the agent said. "There's a group of runners tied to one guy, a group tied to a few guys, and a group who says, 'I don't care who the agent is.' "

The NBA Players' Assn. has responsibility for monitoring the agents it certifies, but the agent described that process as "loosey-goosey." He said the union's investigation into whether Bill Duffy Associates Sports Management engaged in wrongdoing during its recruitment of Mayo should serve as the litmus test for whether the league is willing to get tough.

"You have a big-name agent, an alleged egregious act, and a lot of people looking," the agent said. ". . . It's an irresistible force meets the immovable object."

Barring an overhaul of the current system, the agent predicted that runners would continue to outpace authorities charged with keeping amateur basketball clean.

"Short of someone whose family is wealthy, you can't not break the rules," the agent said. "It's every case.

"Some get a hamburger. Some get free tennis shoes. Some get $1,000 here and there. It's inevitable."

--

ben.bolch@latimes.com

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