MLB Shrinking Dominican Signing Bonuses?
By Tim Brown, Yahoo! Sports 5 hours, 58 minutes ago
Fifteen years ago, when he was barely 17, Vladimir Guerrero left the family farm in Bani, Dominican Republic, for the long road to the major leagues.
His decision, of course, was simple.
The Montreal Expos would pay him $201,000, he said, to sign with them. And Guerrero would leave behind the steer and the chores and the poverty.
The Expos paid him by check and made him rich, certainly by Bani standards. Only he didn’t have a bank account and neither did his parents.
In fact, he laughed at the very idea of it. Bank accounts, after all, were for people with money.
So, assuming he didn’t walk into a bank and walk out with a couple hundred thousand dollars cash, he was asked, who received and banked that check?
“Buscone,” he said, referring to the man who trained him as a youngster and presented him to major league scouts for evaluation.
The system is undergoing change because of the recent bonus-skimming scandal in the Dominican. Six weeks ago, Major League Baseball established a working relationship with The BHD Bank in Santo Domingo, the Dominican capital. Teams are required to wire signing bonuses to the bank. The player – and, if he is not 18, a guardian – is invited to a conference room where a bank official presents the check, sets up an account if necessary, provides the player with a debit card and educates the player on money management. Further, MLB has asked the bank to monitor and record large withdrawals from those accounts, if only to settle potential disputes.
Guerrero’s story ended well enough. He received most of his money, he said, along with tens of millions more when he became a big-league star.
He shook his head at the recent allegations of scouts and front-office executives skimming money, a secret Guerrero’s countrymen apparently have been in on – and victims of – for years. Turns out, the buscones, the native talent scouts whose reputations are as cutthroat and self-serving traders in teen-aged ballplayers, weren’t the only ones with their fingers on those U.S.-written bonus checks.
Like many of the Dominican players who stepped off those rutty ball fields, who made the best of a system that sometimes took advantage of their naivety as much as it did their talents, Guerrero refused to talk about the U.S.-based scouts and team employees recently accused of turning prospects into personal profit. A good-natured man, he shrugged and offered a what-are-you-going-to-do expression.
As one American League general manager said, “There was a bit of a wild, wild West thing going on down there,” and players such as Guerrero, along with many prospects before and since Guerrero, had learned to live with the injustices, perhaps as much a part of the Dominican game as batting practice and infield drills.
Reform has begun with arrests and is continuing with the new banking safeguards. The last bricks are being laid on a BHD branch office in Boca Chica, home to some baseball academies that house the youngest and rawest Dominican ballplayers.
Since 2002, bonus checks of $15,000 or more generally were distributed at MLB’s satellite office in Santo Domingo. Before that, most clubs simply sent the checks to their Dominican-based scouts, who delivered them to the players.
Several general managers and scouting directors, speaking on the condition of anonymity because of the ongoing MLB and federal investigation into bonus skimming in the Dominican Republic, said the system could have been abused by scouts and buscones for years, but was difficult or impossible to police. Only recently, when Chicago White Sox director of player personnel David Wilder was found to be carrying a reported $40,000 out of the Dominican, did their suspicions have a name, a face and a direction.
“For years there’d been rumors, rumblings,” a National League general manager said. “The ones that do it are so good at it, you can’t find a trail. There’s no way to prove that stuff.”
According to MLB officials and various reports, the White Sox in January informed baseball’s Department of Investigations that it believed their Dominican signees were receiving less than their full bonuses. Formed last spring on the recommendation of The Mitchell Report, operating mostly independently from MLB clubs and authorized to explore matters that would threaten the game’s integrity, including performance-enhancing drugs, the six-man investigative unit worked with the FBI to ensnare Wilder and two White Sox scouts, who were fired in May.
As many as eight teams could be under investigation, according to the New York Times, which this week reported the New York Yankees had placed several of their Dominican scouts on leave. The Boston Red Sox fired their Dominican scouting supervisor as a result of the probe. Washington Nationals general manager Jim Bowden and special assistant Jose Rijo have been questioned. Both deny wrongdoing.
“Let me say first and foremost about the employees of the league and its teams, the majority of them are very hard-working, honest people,” said Lou Melendez, MLB vice president of international operations. “Unfortunately, along the way, there have been a few bad apples. This has been painted almost like an epidemic by the press. I’m not trying to downplay the issue. But, me personally, I just don’t see this as a rampant problem. There’s probably a few clubs that are an issue.”
More often, the practice of skimming bonus checks was viewed as a domain of the buscones. That some U.S.-based scouts and executives might also have taken a cut was a revelation to many.
“I think it opened a lot of eyes,” Melendez said.
According to team executives and scouts, there were – and are – a handful of methods to carve up a signing bonus, leaving the player with a fraction of the money.
“And the team,” one American League scout said, “has no idea where the money is going. The kids are manipulated by everyone around them. They’re just 16 or maybe a little older. And they’re surrounded by people who view them as their meal ticket.”
He called the dirty scouts “double agents,” first representing the club and then stealing from the player. Most of the scouts were relatively low-paid, and some might not have even been full-time employees.
“It’s something you can’t fathom,” he said, “but it happens.”
In one scheme, the scout agrees with the player and his family on, say, a $100,000 signing bonus. He reports to the parent club the player can be signed for $120,000, the check is cut and the scout pockets the rest.
In another, he simply claims a finder’s fee, paid by the family, which often enough is satisfied with whatever remains of the bonus.
The scout might work with the buscone, driving up the bonus &nash; along with their personal profits – at the expense of the player and the team.
And some general managers have come to believe scouts have signed non-prospects, simply to continue the revenue flow.
Back home, the teams had little choice but to trust the directors of their Latin American operations, their scouts and the process of transferring money from the scouting budget – often divided into domestic and international accounts – into the hands of the players.
General managers are rarely involved in small to medium signings, anything less than $100,000 or so. Most would receive a list of signings, many inexpensive and intended to fill out the roster of their Dominican League team. Skimming, the general managers agreed, is less detectable on the smaller signings, because so little attention is paid to them.
“Once that check is gone, it’s gone,” said one GM. “The player might come to the U.S. in a year or two. There’s little interaction between then and now, and no one with the club ever asks (if he received his entire bonus).”
The Department of Investigations, several members of which recently returned from a lengthy stay in the Dominican Republic, is preparing a report of its findings. Investigators reportedly have questioned most teams and many players regarding the allocation of bonuses and the investigation has included “a fair amount of back and forth with the FBI,” according to an MLB official.
Meantime, the bonus-skimming scandal has provided more ammunition for proponents of a world-wide draft like the NBA’s.
“A lot of issues improve significantly with transparency,” one official said. “And this would be transparent.”
The collective bargaining agreement expires in December 2011. Extending the draft beyond North America would require reopening the agreement, which had never occurred before 2006, when MLB and the players’ union attached the joint drug agreement.
What remains is a generation of Dominican ballplayers, some of whom became rich playing baseball, some of whom made scouts wealthier, in a place where the good guys began to blur with the bad guys, in a place where sometimes that became part of doing baseball business.
“It’s criminal,” a National League executive said. “This is orange jumpsuit-kind of stuff. It’ll be interesting to see how far it goes.”
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hopeful
We've been over this.
