Former Nebraska Football Players Accepted Gifts, Get Defrauded by Financial Advisor

The Wall Street Journal reports that former Huskers Steve Octavien and Marlon Lucky accepted gifts from a financial advisor during their time at Nebraska in a report about unscrupulous advisors who take advantage of athletes.  Octavien, along with brothers Daniel and Josh Bullocks, say they lost hundreds of thousands of dollars earned during their professional football careers.

Mary Wong, a former stockbroker with First Investors Corp. and Wells Fargo until 2004, solicited several Nebraska football players during their careers in Lincoln. Octavien  said that his scholarship failed to cover all of his living expenses, and with limited opportunities to work outside of his school and football responsibilities, turned to Wong for help.  Lucky said that Wong once gave him $800 for Christmas presents and bought him a suit on a trip to Atlanta during a spring break.  Octavien said that Wong "took care of us like her own children."  Josh Bullocks added "Mary was a best friend to all of us."

Daniel Bullocks said Wong wasn't alone in offering players gifts, saying that about a dozen financial advisors offered him gifts and cash while he was in Lincoln, sometimes tracking the players down in bars. Lucky recognized that Wong was "grooming me" as a client once he left Lincoln to sign a professional contract.  Lucky says he never invested with Wong after his playing career was over.  Octavien and the Bullocks brothers did, only to find out later that the money was gone.  In 2007, Wong was banned by a New York Stock Exchange panel from ever working for any NYSE-affiliated investment firm for defrauding two widowed clients of $150,000.  Octavien believes that the $80,000 he gave Wong to invest was used instead to cover other bills and payments to other clients.  In 2010, Wong pled guilty to securities fraud, and is now serving a 63-month sentence in a federal prison.

Former Nebraska athletic director Tom Osborne recalls little about Wong, other than recognizing her name. He pointed out to the WSJ that the athletic department's compliance group met twice each year with athletes to make sure they knew what was not permitted, and each student-athlete had to sign an annual document indicating they hadn't received anything improper.  A Nebraska spokewoman indicated to the WSJ that they have already contacted the NCAA about "one of the allegations."

So what to make of this? Did anybody in the athletic department have knowledge of these actions while Octavien and Lucky were still in Lincoln? Or is this a case where players and these financial advisors acted without any knowledge of the athletic department?

The WSJ story discusses the double standard between "financial advisors" and "sports agents".  Most states have laws that prevent agents from offering amateur athletes gifts that jeopardize their eligibility, but only Maryland and Oregon have similar laws against financial advisors.

A bigger issue in my mind is the need for athletic scholarships to cover the full cost of attendance for student athletes.  That appears to be coming soon to most major athletic departments.  At the very least, it'll remove one temptation to take money illegally.  In my mind, it's tough to criticize a Steve Octavien for taking money to pay his rent when he has almost no other alternatives.  It also points out the need for Universities to provide more life-skills training to help them identify who they should and should not be dealing with after they leave college.