Update:
Not surprised, my agency deals with insurance fraud all the time. I think I’ve heard it all.
Though since the NFL is self-insured, my agency doesn’t deal with them for this kind of thing, just stuff like workplace safety. (Which seems weird for people who are employed to run into each other at full speed repeatedly.)
The big news in this case is that 1 in 6 retired NFL players will go bankrupt.
I’ve read so many stories over the years about retired players (even star players) who wind up broke soon after leaving the game, due to spending money like it’s water, having an entourage of friends and family members on the gravy train, and making bad investments (or being taken advantage of by unscrupulous “advisors”). Given that, I’m surprised that it’s only 1 in 6.
It’s kind of like winning the lottery. Having a sudden, temporary influx of money can be devastating. You get used to having all that money and then it’s gone and you have nothing but debt. This also happens to people in the entertainment industry; actors and musicians for example. You become a one hit wonder, get a ton of fame and fortune, and then it’s all gone.
It’s very sad. I’d like to think that if I had a sudden windfall, like an inheritance (I’m not a gambler so I’m unlikely to win money any time) that I’d be wise with the money. I’d invest it somehow or put it somewhere that I couldn’t touch it now (like into my 401K for retirement), after paying off my house and my car and wife’s car and her other debt. But then I think of the things I’d like to get but can’t afford and now I’m not so sure I wouldn’t buy some fancy things just because I knew I could.
It’s easy to judge people until you find yourself in that position. It would be nice if there was a trustworthy place that people can go to for help in these situations, someone that wouldn’t screw them over the way many financial advisors seem to. Like a government “windfall assistance” program.
Just the fact that you wrote that sentence in the middle means you have probably given more thought into financial planning than a lot of windfall recipients.
Just recognition that the money:
- Is not infinite, and
- Can be mismanaged to zero (or below), and
- Must be strategically managed to last/grow
is more than half of the battle.
Part of the alleged scam involves ex-players getting compensation for electromagnetic therapy devices that were intended for use on horses. Apparently it’s bad to submit insurance claims for veterinary devices but A-OK to get paid for buying similarly dubious devices that are supposed to fix human problems.
PEMF and related instruments are touted as being good for curing various kinds of sports-related injuries and more (the most enthusiastic online sources tend to be companies selling these machines), but the reality is far less impressive.
Athletes seem to be especially susceptible to snake-oil therapies compared to the general population. Sports reporters aren’t a whole lot more savvy.
I think poor investments can also be a factor. Let’s say you’re an athlete in mid-career making good money. But you know your athletic career will be short and you’ll need some business to make money for you after you retire. So you invest in a chain of restaurants. Five years later you retire. And five years after that, you’re closing down your last restaurant because you weren’t getting customers.
It wasn’t a case of you thinking your current income would last forever or not realizing you needed a future source of income. You saw that as an issue and made investments. I think it’s unfair to compare somebody in a situation like this with somebody who just spent all their money, even though both are now broke.
Well, that case is kind of in the middle. A restaurant is a really high-risk, pretty volatile investment, especially if it’s trading on a celebrity’s name. And, for the celebrity, it’s the worst kind of bet, the one that only pays off if they don’t need the money (after all, if they stay famous and beloved, they’re probably making enough money one way or the other that they don’t need the restaurant income, but if their celebrity career and income ends, the restaurant probably tanks, too).
If you’re a celebrity, putting your money into owning a restaurant is probably closer to spending on something frivolous than it is to making a good long-term investment.
My point was that I feel there’s a difference between somebody who’s broke because they made bad investments and somebody who’s broke because they didn’t make any plans for their future. I can sympathize a lot more with the former than the latter.
The story I read seemed to say that all of the claims were for BS devices. Including “equipment used for the cosmetic removal of body fat”. None of the stuff seemed to be something an ex NFL player would need. The level of stupidity in this fraud is … very …contemporary.
One of the greatest articles I’ve ever read is a 2009 Sports Illustrated article on why athletes go broke.
A considerable number of NFL athletes aren’t the Tom Bradys or Julio Joneses making many millions of dollars per year, but rather, people like 5th-string cornerbacks or special teams players earning less than a million a year. While that isn’t chump change, it also represents money that, after taxes, is very easy to blow through if you don’t have financial brakes - especially since many of these athletes only last, say, 2-4 years in the league instead of 12.