Last time, we began discussing how people might be surprised to learn that the Federal Trade Commission’s duties to protect consumers from deceptive practices extends to the sphere of college athletics via the Sports Agent Responsibility and Trust Act — or SPARTA.
To recap, SPARTA prohibits athlete agents from making gifts — and misrepresentations — in conjunction with the execution of student-athlete contracts. Having established who is and isn’t covered by SPARTA, today’s post will focus on the prohibitions governing athlete agents under the law and potential penalties for violations.
What prohibitions are athlete agents subject to under SPARTA?
Athlete agents are prohibited from directly or indirectly soliciting student athletes to enter into agency contracts by doing any of the following:
- Providing false/misleading information
- Making false promises/representations
- Providing anything of value to the student athlete or anyone associated with them prior to executing an agency contract
In addition, athlete agents are prohibited from predating or postdating agency contracts, and executing such documents without first providing the necessary disclosure document.
What exactly does the disclosure document need to address?
SPARTA establishes the disclosure document provided to the student athlete (or their parent/legal guardian if under 18) will need to contain a very specific warning in boldface type situated as close as possible to the signature lines.
It serves as notice to the student athlete that by signing the agency contract, they are essentially forfeiting their NCAA eligibility and that the athletic director (or similarly placed official) will be notified of their signing promptly.
What can the FTC do if an athlete agent violates SPARTA?
If the FTC pursues an action against an athlete agent for violating SPARTA, as opposed to the Attorney General’s Office of the state where the alleged violation occurred, the guiding instrument will be the Federal Trade Commission Act.
This landmark law, in turn, declares that the athlete agent may be fined up to $11,000 if found to have committed an unfair or deceptive practice.
Here’s hoping the following information has proven helpful. Always remember to consider speaking with a skilled legal professional to learn more about your options if you are an athlete who has been financially harmed by the intentional wrongdoing or questionable decisions of your agent.