The NCAA’s Options In Investigating Lance Thomas’ Jewelry Purchases

By:  John Fabiano, Ruling Sports Intern (Twitter:  @Fabs5180)

Now that Lance Thomas has settled the lawsuit filed against him by Rafaello and Co., the NCAA’s investigation into how the former Blue Devil was able to afford almost $100,000 worth of jewelry becomes even more difficult.

In December of his senior year at Duke, Thomas allegedly purchased $97,800 worth of jewelry from the New York based jeweler Rafaello and Co., which promotes itself as the jewelry provider for numerous celebrities and athletes.  Thomas allegedly made a $30,000 down payment and agreed to pay the remaining balance within 15 days of purchase.  What the NCAA wants to know is where Thomas came up with the $30,000 down payment and why Rofaello and Co. felt confident in giving a 21-year-old college student $67,800 in credit without requiring a co-signer.

There’s a chance that Thomas received the money from an agent trying to buy him as a client.  The NCAA has handed out strict punishments to programs whose players have received improper benefits.  When it was found that USC stars Reggie Bush and O.J. Mayo had received gifts from agents, both players were determined ineligible and Trojan wins in both football and basketball were vacated.

If it is found that the money Thomas used to make the down payment came from an agent, he could be declared ineligible and, similar to the USC case, all of Duke’s wins during the 2009-10 season that came after the jewelry purchase could be vacated.  That would include their 2010 National Championship victory.

The difference between USC and Duke’s situation is the status of the players.  Bush was a Heisman Trophy winner who was drafted 2nd overall in the NFL draft.  Mayo was receiving national recognition as a top prospect since he was in grade school and was drafted 3rd overall in the NBA draft.  Agents were fighting to represent them because of the huge commission that came along with negotiating their rookie contracts.

Thomas averaged 4.8 points a game during his senior year at Duke, went undrafted, and spent two years in the NBA D-League before making the New Orleans Hornets squad last year.  Would an agent be willing to invest such a considerable amount of money into a player with a slim shot at a successful pro career?  It’s possible.  In the extremely competitive industry of representing pro athletes, some agents are willing to take big risks with the hopes that their investment will pay off down the road.

As for the line of credit, the owners of Rafaello and Co. may have thought that Thomas had a legitimate shot at a pro career, would be able to pay them back after signing his rookie contract, and would become a regular customer throughout his career.  This could explain why they did not require a co-signer and waited two years to file a lawsuit against him when the money was due 15 days after purchase.

If the credit was based on his status as a Duke basketball player, it could be a violation of NCAA bylaw 16.01.3 which states that receiving a benefit “is not a violation if it is demonstrated that the same general benefit is available to the institution’s students, their relatives, and friends determined on a basis unrelated to athletics ability.”

One thing is for sure, the average Duke student isn’t going to walk into Rafaello and Co. and receive a  $67,800 line of credit.  As the jeweler’s lawyer said, “Speaking hypothetically, if he came in on a bicycle with tattered jeans, I doubt seriously he would have been sold jewelry.”  If the NCAA finds that the line of credit was granted due to Thomas’s future earnings potential, bylaw 16.01.3 would have been broken.  They could use this to declare Thomas ineligible and vacate wins from Duke’s championship season.

The NCAA’s trouble with finding any information about the transaction is that both Thomas and Rafaello and Co. have been silent on the matter.  Neither party has any incentive to give details about where the money came from, especially now that the debt is settled.  Furthermore, the NCAA cannot force either party to disclose details as Thomas is not longer under NCAA jurisdiction and the NCAA does not have subpoena power over Rafaello and Co.

Making matters even more difficult for the NCAA is that the settlement agreement probably contains a confidentiality agreement.  If this is the case, both parties will be restricted from discussing the terms of the settlement with a third party.

The statute of limitations runs four years from the date the jewelry was purchased.  That means the NCAA has until December 19, 2013 to notify Duke of any potential violations.  The time for investigating is there, but evidence showing that Thomas or Duke violated any NCAA bylaws is not.  For the time being, it doesn’t look like Duke’s 2010 National Championship is in serious danger.

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Filed under Civil Lawsuits, NCAA

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