Basketball Bribery Scandal Is A Corporate Corruption More Than Sports Scandal

The fallout from the latest college basketball bribery scandal has just begun. Just now, Rick Pitino, the legendary coach currently at Louisville, has essentially been fired, as the school put him an administrative leave. Other head coaches and athletic directors are likely to follow Pitino into the unemployment line and it's quite possible that some programs may once again receive the NCAA's death sentence, despite the organization's incredible reluctance to use it.

One part of this scandal is fairly typical of what we have seen in the past. Coaches are bribed to steer potential pro athletes to specific agents or financial advisers. That is not new.

But, to my mind, the bigger scandal here is the willful and organized involvement of Adidas in the bribery scheme. This is not just the usual NCAA sports scandal where the coaches and/or boosters are paying players to come and play at their school or taking a kickback for steering players to specific agents. This is a multinational corporation that has probably paid out millions in bribes to coaches, schools, and players in order to further its business goals. This will get billed in the press as a college sports scandal but, in reality, it is more of a corporate corruption scandal. That becomes doubly true if you believe that big-time NCAA athletic programs are really a corporate power on its own, rather than sport.

There has always been corruption in big-time college sports, primarily because there is big money involved and the drivers of that income, the athletes, are not paid for the value they produce. But the seeds of this particular scandal lie in the decision by colleges to sign exclusive apparel contracts, starting with shoe companies. Once that happened, the apparel's brand became associated with that particular team and now the apparel company had a real incentive to make sure the college program continued to maintain its status on the elite level. In addition, the coaches also gained leverage over those same apparel companies and could involve the company in bringing a potential recruit to the school. It was the perfect storm.

Not only was Adidas paying athletes to go to specific Adidas-sponsored programs but it was also paying coaches to steer potential pros to sign Adidas contracts. Adidas released a statement that claimed it was "unaware of any misconduct and would fully cooperate with authorities to understand more". But the amounts of money involved seem like it would be hard for the corporate head office to not notice. Just one recruit received $100,000 to attend Louisville, with the additional promise that the recruit would sign with Adidas if and when he turned pro. That was just one recruit, so we can only imagine what the total dollar amount of Adidas bribes will come to.

These initial charges are probably just the tip of the iceberg. We are already hearing that people are coming forward with additional information. And it is also not clear whether this particular bribery scandal is limited to basketball. Basketball's smaller roster makes it a more inviting target but the same conditions that created this scandal also exist in football as well, though probably not to the same degree. In addition, if Adidas was engaging in this type of behavior, we can imagine that the other apparel companies were probably doing the same thing. In such a competitive industry, it is hard to see how any of its competitors would let Adidas get away with that competitive advantage.

The media is and will treat this as a college sports scandal because that is where the personalities are. But it is more so another example of the impunity which corporations continually and willingly break the law and treat those criminal activities as simply the cost of doing business. Because that is all it is. Just like the NCAA, the DOJ is just as reluctant to again implement the corporate death penalty. Perhaps this case will force that change.