Agent Boras Scrutinized

Since making it big by representing players like Barry Bonds and Alex Rodriguez ("A-Rod), competing agents have hoped for a day to catch agent Scott Boras in illegal activity. Boras has dominated the baseball market for many years, making it difficult for other agents to compete. Well now, those agents may have a chance for a little break...

Boras is now being questioned for making illegal payments to prospective players in the Dominican Republic. The NY Times reports that Boras has made payments to prospects in the Dominican that violate the Union's rules for agents. Agents are only allowed to give loans of less than $500 to prospects unless disclosed to the Union. This regulation is designed to minimize the dependence a prospect has on an agent. Boras allegedly provided players in the Dominican of upwards of $70,000!

It is unclear what punishments, if any, Boras will receive from the Union, but this activity will not go unnoticed.

Note: Boras' alleged payments to Dominican prospects are more carefully scrutinized than those made by investors and hedge funds as reported earlier this week. This is due to the additional dependency players have on the expertise of agents, as well as, the regulations agents are subject to within the confines of the Union.

US Investors Look to Latin Baseball Futures

The NYTimes ran an interesting article yesterday revealing the new investment of some big players in Domincan Republic youngsters. The idea is that the investors and hedge funds front money now for young baseball prospects in the DR with the hope of receiving a big payday when the youngster gets signed to the MLB. These investors furnish trainers with facilities and resources to train boys in their young teens. When the player is then signed to a MLB team, the investors receive 50% of the player's bonuses (while an agent only gets 15%).

Sounds interesting, but is it exploitation of these desperate young teens? Many of the boys forgo formal schooling for this baseball training and are rumored to possibly being intertwined in steroid use. Moreover, the facilities vary between the camps, from state-of-the-art to cramped quarters resembling a prison with barbed wire.

The bottom line is that there is no regulation of investment in Latin baseball futures as there are in other investments. With this investment, boys are encouraged to forego schooling and other opportunities to make US investors a profit. Money is money and as usual it seems to put our priorities a bit out of whack.