Show Me The Money! NCAA Booster Collectives Push Pay-For-Play Boundaries

Written By Tyler Andrews on May 20, 2022 - Last Updated on October 17, 2022
Texas sports betting, booster collectives NCAA

Before NIL laws were enacted to allow college athletes to profit from their personal brand, the NCAA had concrete laws against boosters giving athletes “gifts” or money. With NIL, however, an apprehensive NCAA has allowed booster collectives to cross traditional pay-for-play boundaries, even spilling into recruitment.

With college sports changing at such a fast pace, with player-data sharing agreements and NIL lawsuits, the NCAA is under the gun to get this all figured out.

Although sports betting in Texas is not legal at the time, there is a strong belief it will become a reality during the next legislative session. So, the topic of sports betting is related to NILs in the sense that it’s money funnelling through the NCAA.

In the eye of the Hurricane

John Ruiz Jr. is a University of Miami alum and head of a major UM booster collective. He has thrived in this new legal gray area created by NIL ventures.

“My platform is very consistent with all the rules with NCAA and state law. We probably have a more robust compliance system than the schools or the NCAA itself. I’m extremely comfortable. This is totally kosher. We have legitimate companies.”

Legitimacy is one thing, but the UM is realizing that it means very little when uncoupled from pragmatism. Before the NCAA transfer window closed on May 1, the Hurricanes found themselves in a storm of NIL litigation and student holdouts that quickly spread across the country.

The inconsistency in NIL laws mixed with the vague language about what services or jobs must be provided for athletes to earn their pay, made players think that NIL was no longer a perk of collegiate sports. It was the starting point.

The player that initiated the heated transfer negotiations was Isiah Wong, UM junior and one of the leaders on the team that rolled to the Elite Eight last season. His agent, Adam Pappas, informed Sports Illustrated:

“If Isaiah and his family don’t feel that the NIL number meets their expectations, they will be entering the transfer portal tomorrow, while maintaining his eligibility in the NBA draft and going through the draft process.”

Agent creates bidding war

This statement came just after the Hurricanes signed the top transfer of the year, Nijel Pack of Kansas State. Pack’s transfer included an $800,000 NIL deal, funded by Ruiz, who has more than 100 deals in place with UM athletes through his two companies, LifeWallet and Cigarette Racing.

The Pack transfer led Pappas to demand a better deal for Wong, who had actually played on the Elite Eight Hurricanes. In his mind, Wong deserved to be compensated in proportion to Pack. Pappas, to be clear, is the agent for both Pack and Wong.

Less than 48 hours after Pappas made the claim, Wong spoke out. He said he never intended to transfer over NIL deals. Ruiz, however, who had already made an NIL contract with Wong for $100,000, stepped in. He offered to help Wong find further NIL opportunities. While Ruiz didn’t renegotiate his contract to keep Wong, the stunt set off the nation’s coaches and inspired a stream of anecdotes of other NIL snafus.

Booster interference and NIL stand-offs

Todd Berry, head of the American Football Coaches Association, shared with CBS Sports:

“I have some coaches call me and say, ‘I don’t know what to do about this booster because he’s offering all these kids NIL money and I don’t even want the kid.’”

These coaches are running into more powerful booster collectives. Collectives which have exerted substantial control over the recruitment process, such that recruiting coaches are forced to lead with NIL opportunities when meeting a prospective player.

Entering the May transfer portal at the deadline, in the words of one coach, is “all about leverage.” Players know that if they want to make a major NIL deal, their leverage instantly dries up once the window closes on May 1.

For even the most experienced coaches, the process is chaotic. And many are being hammered by agents with language that suggests that if we don’t get the money, we’ll walk. And there’s no negotiating.

Will NCAA stop ‘collegiate free agency’?

An NCAA task force is currently investigating the strategies of these booster collectives. It will hopefully establish clearer guidelines to avoid what Matt Norlander at CBS Sports called “collegiate free agency.”

How they will establish boundaries between boosters and college and high school athletes could be tricky given the way Ruiz and others have ensconced themselves. Will booster collectives continue to push pay-for-play boundaries? They can argue that while they are boosters, they are establishing “work” relationships with these athletes. Relationships that are not directly tied to a university and do not violate any state laws.

The larger problem of enforcement rests with these different state laws that govern NIL deals. Universities in those states are beholden to those laws. An NCAA policy would need to meet the needs and standards of the individual states. Or else find itself in legal battles it would probably lose.

As we’ve seen in the last few years, the NCAA has not fared well in the courts when restricting student compensation. This situation, however, is not quite the same as the ones in the past.

The NCAA, gun-shy after so many lost legal battles, has ceded most of the ground to interests that serve student compensation. They’re essentially back where they started in the 1980s when under-the-table deals for top athletes were commonplace.

Would they be willing now, if they found that a booster collective had egregiously overstepped the booster-athlete relationship, to levy the “death penalty” on a school the way they did to SMU?

Photo by Michael Ainsworth/Associated Press
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Tyler Andrews

Tyler is the Managing Editor for PlayTexas, covering sports, sports law and gambling for the Lone Star State. He has also covered similar topics for a number of Catena Media's regional sites including NCSharp, PlayCA, PlayFL, PlayOhio, and PlayMA. Tyler is a Texas resident and currently specializes in covering gambling legislation and news in emerging US markets.

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