Oklahoma has passed legislation modifying its version of the Uniform Athlete Agents Act (UAAA) to impose stricter penalties on a broader range of persons. Authored by President Pro Tem Brian Bingman (R-Sapulpa) and Rep. Todd Thomsen (R-Ada), the Sports Agent Act (HB 1586) expands the definition of “agent” and imposes six-figure fines and extended jail times on violators.
Not only are traditional sports agents and their runners covered under the amended law, but conceivably anyone who induces a student-athlete to sign a representation agreement. The Act adds to the persons covered any individual who “contributes a causal nexus to a student-athlete becoming the signator to an agency contract.” A player’s family also will be subject to the law if they act on behalf of the player for compensation. And financial planners are specifically included in the definition of agents. No doubt this is a reaction to the events involving former University of Oklahoma basketball player Tiny Gallon, who sparked an investigation amid allegations that a financial advisor improperly funneled money to his family. As amended, the UAAA will apply to any person authorized by the student-athlete “to assess and plan the financial situation of the student-athlete regarding his or her professional career.”
Penalties for violations have increased significantly. Fines for a first offense can go as high as $250,000, and can jump to $500,000 for a second offense. This is in addition to any civil damages and penalties that might accrue. Criminal penalties range from one to three years of imprisonment.
The Act authorizes the Oklahoma Attorney General to prosecute violations. Agents under prosecution must post a bond of no less than $250,000 to cover liability. How authorities will prosecute violators is not yet know, but they have a strong incentive to be aggressive: 50% of all fines collected will go into the State’s Law Enforcement Revolving Fund.
With steep penalties and the State’s new prosecution powers, agents (including financial planners) should try to mitigate any risks by developing an internal UAAA compliance program. Avoid potential liability by knowing the specific rules governing player representation and ensuring compliance with both state laws and university policies. Jackson Lewis attorneys are available to assist developing and managing athlete-agent compliance programs.