Adidas executive James Gatto was among three men found guilty in a US court on Wednesday of conspiring to make illegal payments aimed at recruiting promising players to universities affiliated with the sportswear giant.
Gatto, the company’s director of global sports marketing for basketball, and former Adidas consultant Merl Code were convicted along with sports agent Christian Dawkins on charges of wire fraud and conspiracy to commit wire fraud in connection with a scheme to funnel US$100,000 to the family of former University of Louisville player Brian Bowen.
In similar schemes, money was funneled from Adidas to promising players who ended up at the University of Kansas and North Carolina State University — both sponsored by the company.
“Today’s convictions expose an underground culture of illicit payments, deception and corruption in the world of college basketball,” prosecutor Robert Khuzami said.
“These defendants now stand convicted of not simply flouting the rules, but breaking the law for their own personal gain,” he added. “As a jury has now found, the defendants not only deceived universities into issuing scholarships under false pretenses, they deprived the universities of their economic rights and tarnished an ideal which makes college sports a beloved tradition by so many fans all over the world.”
Evidence in the trial included text messages between the defendants and coaches from high-profile university basketball programs that feed players to the NBA.
Bowen’s father testified that a University of Louisville assistant coach once gave him an envelope full of cash.
The defendants pleaded not guilty, but did not deny they sought to make the payments.
They argued that it was standard practice by apparel manufacturers, who stood to form lucrative associations with the players once they made it to the NBA.
The National Collegiate Athletic Association forbids monetary inducements to players.
The trio are scheduled to be sentenced on March 5 next year, although Gatto’s attorney, Michael Schachter, said he would appeal.
Adidas issued a statement saying it remains committed to ethical business practices.
The case was just one resulting from a massive FBI investigation that exposed the “dark underbelly of college basketball,” federal prosecutors said.
Four coaches associated with top universities sponsored by Nike and Under Armour were also named in indictments earlier this year.
Former Auburn University assistant coach Chuck Person and financial adviser Rashan Michel are to be tried in February.
Tony Bland, Brook Richardson and Lamont Evans, all former assistant coaches at different universities, are scheduled to go on trial in April.
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