Three similar criminal cases involving college basketball are currently progressing through the Southern District of New York. The first to go to trial, United States v. James Gatto, Merl Code, and Christian Dawkins, No. 17 Crim. 686, culminated in a guilty verdict on October 24, 2018, with all three defendants found guilty on charges of wire fraud and conspiracy to commit wire fraud.
The United States Attorney’s Office for the Southern District of New York alleged that the Gatto defendants participated in a scheme in which the defendants—former Adidas employees Gatto and Code, as well as aspiring sports agent Dawkins—made payments to the families of college-bound athletes in exchange for the athletes’ agreement to play basketball at universities with teams sponsored by Adidas. Prosecutors characterized this conduct as a criminal conspiracy, rather than a mutually beneficial business transaction, because the payments violated the amateurism policy of the National Collegiate Athletic Association (“NCAA”), the private organization that regulates college athletics at member institutions. NCAA regulations provide that athletes lose their eligibility to participate in NCAA sports if they receive payment for their athletic skills, and the NCAA imposes sanctions on universities for noncompliance by their athletes. The NCAA also requires that both student-athletes and coaches submit to their schools annual certifications of compliance with NCAA rules.
Trials of two other groups of defendants were previously scheduled for later this year. In both cases, the charges involve schemes wherein student-athletes received payments in violation of the NCAA’s amateurism rules.
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From the Basketball Court To Federal Court: Perils of the Prosecutorial Approach to Wire Fraud in the NCAA Basketball Cases,
Available at: https://scholarship.law.columbia.edu/public_integrity/10