30 for 30 Podcasts: Bag Game Ep. 3
PAULA LAVIGNE: (00:00:00) Previously on the Bag Game–
NICOLE PLAYER: (00:00:03) They wanted Billy to go to an Adidas school, to an Adidas-branded school.
BILLY PETERSON: (00:00:08) The first question that comes up is, where’d you get the Charger from?
MALE REPORTER: (00:00:11) The black market economy of playing players under the table exists because of the NCAA’s amateurism rules.
PAULA LAVIGNE: (00:00:25) In 2019, I went with my reporting partner, Mark Schlabach to Orlando, Florida. We were there to meet a guy named Brad Augustine. So what is your normal work week like now?
BRAD AUGUSTINE: (00:00:40) Oh, gosh. Mostly it’s in the car. I’ve got a handful of accounts, so– (PHONE) and they’re spread out. So Tampa, Central Florida–
PAULA LAVIGNE: (00:00:47) These days, he works in his father-in-law’s flooring business.
BRAD AUGUSTINE: (00:00:52) Porceline tile. We do do a little bit of wood. The only thing we really don’t deal with is carpet.
PAULA LAVIGNE: (00:00:57) Augustine worked his way up in the world of commercial flooring, from forklift driver, to sales rep over two years. But it was a career change for him. And that led to some awkward conversations.
BRAD AUGUSTINE: (00:01:11) It was nerve-wracking the first couple times when people asked me, “Well, how did you end up in this industry? Like how are you here?” And it’s never something I hid. It’s always something I was honest about.
PAULA LAVIGNE: (00:01:20) He’d tell them the story about how his old life in basketball came to an end.
BRAD AUGUSTINE: (00:01:27) But, you know, telling that story for the first time, you’re sweating like, “Oh my gosh. These people are gonna look at me like I’m the worst human being on the planet.
PAULA LAVIGNE: (00:01:35) And that was why I was there, to have him tell me that story.
BRAD AUGUSTINE: (00:01:41) Hi.
PAULA LAVIGNE: (00:01:42) We arrived at his spacious home in a gated community–
CHILD’S VOICE: (00:01:45) Hi, guys.
PAULA LAVIGNE: (00:01:47) –in the Orlando suburbs.
BRAD AUGUSTINE: (00:01:48) Can you say how are you?
PAULA LAVIGNE: (00:01:48) His wife, Alexa, greeted us, along with their newborn daughter and her big sister, a toddler, who ran across a playroom of dolls and toys toward the front door. You’re silly.
CHILD’S VOICE: (00:01:59) Yeah. (LAUGHTER)
PAULA LAVIGNE: (00:02:03) In his previous life, Augustine was the program director of one of Florida’s premier youth basketball programs. Teams like his aren’t funded through public schools or rec centers. They’re private operations. And Augustine went into debt to support the team.
BRAD AUGUSTINE: (00:02:23) I was $50,000 in debt, with not one penny in savings, nothing.
PAULA LAVIGNE: (00:02:27) Augustine tried getting money from every source he could think of. But he was struggling to keep his head above water. In September, 2017, he got a call from Christian Dawkins, a rising sports business manager and aspiring financial advisor. Dawkins had connections at Adidas. And he had helped Augustine raise money in the past.
BRAD AUGUSTINE: (00:02:55) He told me, “Listen. You need to come to New York. And you need to meet my investor,” is what he– he called her. Her name was Jill (PH).
PAULA LAVIGNE: (00:03:01) According to Dawkins, Jill Bailey was a tech entrepreneur with money to burn, who wanted to get into the sports business. Dawkins wanted her to meet Augustine, to prove to her he had connections to up-and-coming athletes. If Augustine talked the talk in front of Bailey, Dawkins promised to pull strings at Adidas to get money for Augustine’s team.
BRAD AUGUSTINE: (00:03:27) So I told my wife. I said, “I’m– I’m leaving. I’m going to the airport.”
PAULA LAVIGNE: (00:03:30) Augustine got to New York and checked into his hotel that night.
BRAD AUGUSTINE: (00:03:34) I’m an early riser. I always have been. I’m up around 5:00. So I’m up in the hotel room, about 5:00, 5:30. (PHONE RINGS) And I get a weird phone call. And I’m like, “Who’s this?” And the person on the other end of the phone says–
JIM GATTO: (00:03:48) This is so and so with the F.B.I. We know you’re in New York City. You need to turn yourself in.
BRAD AUGUSTINE: (00:03:53) Now at this point, I’m not even thinking twice. I literally– I’ve got the funniest friends. So they’d prank call me all the time. And I hung up.
PAULA LAVIGNE: (00:04:01) Unfazed, Augustine made his way to the W Hotel in Times Square, where the meeting with Dawkins and the tech entrepreneur Jill Bailey was supposed to happen.
BRAD AUGUSTINE: (00:04:12) So I get to the W at 7:30. We’re supposed to meet at 8:00. So I’m there at 7:30. I got the laptop fired up. I’m making phone calls. I’m just– I’m reading the news. 7:45. I’m calling Christian. 8:00. Nothing. So now it’s 9:00. And now I’m pissed, right? I flew up here for this meeting. This guy’s not even calling me back. He’s totally ghosting me.
PAULA LAVIGNE: (00:04:31) Augustine decided he’d waited long enough and left the hotel.
BRAD AUGUSTINE: (00:04:36) And I’m standing right in the middle of Times Square (HORN) just– just circles of people around me. And the lights are all lit up. And all of a sudden, my phone just starts (PHONE) pinging. Notification, after notification, after notification. So I swipe the first notification I see. And it– it opens up a Tweet. And it says, “United States of America Versus Jonathan Bradley Augustine.”
PAULA LAVIGNE: (00:05:00) Augustine had just been criminally charged by the U.S. Department of Justice. And he found out about it through a Tweet.
BRAD AUGUSTINE: (00:05:10) I had to have sat there for two minutes just staring at my phone. I didn’t move. I don’t know if I took a breath. I was so confused. And then I think somebody bumped into me. And I just snapped out of it. And I started scrolling. And I see– I see four felony counts. And so in that moment, before I did anything, I called my wife. I said, “Hey, babe. I have no idea what’s going on right now. But I’m pretty sure I’m gonna get arrested today.”
PAULA LAVIGNE: (00:05:36) Brad Augustine didn’t know the full story yet. But he had been implicated in one of college basketball’s most dramatic pay-for-play scandals. The same one that ensnared Billy Preston.
MALE REPORTER: (00:05:53) The Department of Justice has brought charges in a wide-ranging college basketball bribery and fraud case–
MALE REPORTER: (00:05:58) And arrests including four assistant coaches, charged in a bribery scam–
MALE REPORTER: (00:06:03) Charges come after a sting operation involving wiretaps and a previously convicted financial advisor cooperating with the government.
PAULA LAVIGNE: (00:06:11) This marked the end of Augustine’s career and would lead to him being called the most dangerous man in college basketball. For ESPN and 30 for 30 Podcasts, I’m Paula Lavigne. And this is the Bag Game, Episode three, “The Sting.” In the first two episodes, we focused on Billy Preston, a basketball player benched at the University of Kansas after his car accident got the attention of the NCAA.
(00:06:56) Billy left Kansas to play in Bosnia, and we’ll return to him later. But right now, let’s shift the focus to Brad Augustine, because Augustine’s story takes us inside the big-money world of youth basketball. If you pull the thread on pay-to-play schemes, you’ll often find youth teams at the source. Long before he was in the sights of the Justice Department, Brad Augustine grew up in Orlando and went on to play basketball in college.
BRAD AUGUSTINE: (00:07:34) At Southeastern University, had an opportunity then to go overseas. Only played about a half a season. Wasn’t for me.
PAULA LAVIGNE: (00:07:42) But Augustine wasn’t ready to give up on basketball. So he returned to Florida and became a trainer.
BRAD AUGUSTINE: (00:07:49) I had a really good name in the state of Florida training. I mean, I would argue at one point that I was the premier guy to go to. If you were an elite player, you were gonna search me out for training.
PAULA LAVIGNE: (00:07:59) In 2012, one of the players Augustine had trained went pro. And he offered Augustine money to start a youth basketball team. That was the beginning of what was then called Showtime Hoops.
BRAD AUGUSTINE: (00:08:14) We were known for just being the hardest working, toughest group.
PAULA LAVIGNE: (00:08:18) The team was part of the Amateur Athletic Union, or AAU. Same as TJ Gassnola’s team, the New England Playaz. As Showtime Hoops established itself, Augustine spent more and more of his time figuring out how to pay for the program.
BRAD AUGUSTINE: (00:08:37) I quickly realized, “Boy, it costs a lot of money to do AAU right.”
PAULA LAVIGNE: (00:08:43) That’s because AAU teams travel to tournaments all around the country.
BRAD AUGUSTINE: (00:08:48) You’re traveling a minimum of 30 kids, a coach or two coaches. So you’re renting 15-passenger vans. You’re– you’re getting hotels. You know, these kids aren’t getting sent with any money. So– so you’re at McDonald’s. Or you’re at Wendy’s. Or you’re at Waffle House, where you can get the biggest bang for your buck. Or you’re ordering pizza. And, man, it’s a lot other balance.
PAULA LAVIGNE: (00:09:08) These were 15 to 17 year old kids. They eat a lot. Some of the players’ families helped to play for the team’s costs, but most weren’t able to. Augustine had money from his backer in the NBA. But he was also taking on tens of thousands of dollars in personal credit card debt. His wife, Alexa, felt the impact.
ALEXA AUGUSTINE: (00:09:35) I was enough removed to– to see the destruction that could come from the irresponsibility with our finances. I think Brad was a little too entrenched in it. And he’s– he’s a visionary. And he’s a cup-half-full person.
PAULA LAVIGNE: (00:09:52) Alexa was, herself, a former college player at Florida State. She’d considered her own pro career overseas. But she stayed in Florida and ended up working in an athletic program at a local high school.
ALEXA AUGUSTINE: (00:10:06) I kinda felt like a single mom for a lot of time. I– I was working a full time job. Most nights– he wasn’t there. He was either traveling, or driving, helping pick up a player, drop a player off, take him to get books for school, whatever that entailed.
PAULA LAVIGNE: (00:10:24) Augustine knew the only way to keep Showtime Hoops going was to get sponsored by one of the apparel companies and play in their circuit.
MYRON MEDCALF: (00:10:35) And with that, that’s shoes, that’s apparel, that’s travel, that’s all of the bells and whistles that come with being a part of Nike, or Adidas, or Under Armour.
PAULA LAVIGNE: (00:10:47) That’s Myron Medcalf, who covers college basketball and recruiting for ESPN.
MYRON MEDCALF: (00:10:53) You know, I’ve been to events where, you know, you look on the sideline, and– and there are five boxes of shoes per kid, because these companies are just giving ’em that. Or the kid flew first class maybe to get there.
PAULA LAVIGNE: (00:11:06) For the companies, it’s an investment. Some of these kids are going to go pro. And brands want to establish a relationship.
MYRON MEDCALF: (00:11:14) At the top, in terms of those deals, are the shoe companies hoping that they’ll land the next LeBron. So they’re fueling– putting a lot of money into making sure these tournaments are top notch. And they are.
PAULA LAVIGNE: (00:11:28) To get your program on one of the top flight circuits, you need to have the kind of talent that attracts national attention. Augustine had a promising young guard named Nassir Little.
PLAY-BY-PLAY: (00:11:43) Getting out to Nassir Little. And he continues to impress, as he–
BRAD AUGUSTINE: (00:11:46) Unbelievable family, unbelievable young man. He was our motor.
PLAY-BY-PLAY: (00:11:49) –on the floor. Take the bump, the contact. And he’s got a grown-man body already. He’s– he’s already prepared for college basketball physically.
PAULA LAVIGNE: (00:11:56) Today, Little plays in the NBA for the Trail Blazers. But at the time, he was Showtime Hoops’ star. Augustine made a connection with a rep from Under Armour. And his pitch was simple: Give us a shot.
BRAD AUGUSTINE: (00:12:12) I don’t want any money. I don’t want anything. Just give us an opportunity. Give us an opportunity. Let us get on the circuit.
PAULA LAVIGNE: (00:12:20) In 2016, Augustine’s team competed on the Under Armour circuit.
BRAD AUGUSTINE: (00:12:25) We lost every single game on the Under Armour circuit. And you wanna talk about showing up to a tournament and having these guys look at you like, “You sold me a bag of goods. You guys are terrible.” And now– not only that, now we’re not traveling to Georgia.
(00:12:41) I’m having now to buy flights, right? So now I’m flying a whole team to Indianapolis, to New York. You ever tried to rent two 15-passenger vans in New York City? You know how expensive that is? So, you know, we’re just scraping by. And at the end of that season, I just remember I felt so defeated because, I mean, we had failed on the biggest stage.
PAULA LAVIGNE: (00:13:04) It was at this moment, when things were particularly bleak, that Augustine made a friend.
BRAD AUGUSTINE: (00:13:12) I ended up getting connected to a guy who I was told, like, just had the juice. And somebody got me a meeting and said, “Meet this guy. If you think your program’s that good, tell this guy, and– and you may– you may figure it out.” And– and that was Christian Dawkins.
PAULA LAVIGNE: (00:13:27) What was your first impression of Christian?
BRAD AUGUSTINE: (00:13:29) Very bright, very direct, very intelligent. Understood the landscape. Was clearly knowledgeable. Was clearly tied in. Clearly had influence. No BS.
PAULA LAVIGNE: (00:13:42) To understand Christian Dawkins is to understand the complex way that under-the-table money works its way into the system. Here’s Dawkins talking in an interview on YouTube about how he got started in the business.
CHRISTIAN DAWKINS: (00:13:57) Once you’re around talented people, who are worth money to– to entities and businesses, I mean, people figured out that I could be, you know, beneficial to their businesses. And– and it kind of blossomed from there.
PAULA LAVIGNE: (00:14:09) Dawkins had been working as what’s known as a runner for a prominent agent, who paid him to recruit young basketball players with pro potential. But around the time of his meeting with Augustine, Dawkins had a new plan. He wanted to start his own financial advisor business. He would steer kids to particular schools and then take the athletes on as paying clients once they turned pro. Here is Myron Medcalf again.
MYRON MEDCALF: (00:14:41) Christian Dawkins represented himself as someone who could help teams get players, someone who could make moves, someone who could be a go-between to the top talent in America and the top programs in America.
PAULA LAVIGNE: (00:14:55) Those sorts of claims are often exaggerated. Dawkins needed connections like Augustine to deliver.
MYRON MEDCALF: (00:15:03) You better believe about 25% of– of what you hear on the AAU circuit, ’cause the other 75% is probably BS. And if you’re Christian Dawkins, you’re trying to figure out, “Yeah. I wanna build these relationships. But I’m also trying to move up the food chain, too. And I’m not moving up the food chain without somehow being– a power player in this business that people can turn to when they wanna land top prospects.”
PAULA LAVIGNE: (00:15:30) Understanding the payoff for people like Dawkins is key to understanding the bag game. Sometimes go-betweens like Dawkins would get a fee for recruiting a player for an agent or a shoe company. But that’s not a sustaining income. So what’s in it for them in the long run? According to Matt Babcock, the former agent we met last episode, it comes down to what’s known as a point, or a percentage of an athlete’s pro contract.
MATT BABCOCK: (00:16:05) The terminology being they– they want a point, which means they want 1% of your agent fees. That– that– that’s a very common sort of standard request– from AAU coaches, handlers, even– even parents. And I think the guys that have probably done this the most successfully are the guys that have long-lasting relationships with schools, agents, or shoe companies, that they do take those deals, and they ride it out the long term.
PAULA LAVIGNE: (00:16:29) So where is that actually written down? Is that– is that in writing anywhere?
MATT BABCOCK: (00:16:34) Probably not. I think a lot of those are just sort of wink, wink type deals.
PAULA LAVIGNE: (00:16:39) So how often do the players even know this is happening?
MATT BABCOCK: (00:16:43) I’d say in most cases, they don’t know.
PAULA LAVIGNE: (00:16:47) So that’s the long-term strategy for people like Dawkins. He positioned himself as someone who could deliver top players to agents, apparel companies, and colleges. Augustine and Dawkins frequently talked about who Showtime Hoops players wanted to go to school. See. AAU coaches have a lot of influence on their players’ college decisions. College coaches can’t just talk to high school players whenever and however they want. The NCAA controls that. So the AAU coach is the go-between.
MYRON MEDCALF: (00:17:23) 20-plus years ago, if you wanted to go and get a top player in America, you went to his high school coach. That’s not the case anymore. I mean, you’re going to the AAU coach nine times out of 10. So there’s– they’re– I mean, they’re powerful. If Coach K wants players, he’s gotta call you. Bill Self has to call you.
PAULA LAVIGNE: (00:17:44) Augustine helped Dawkins by steering his program’s top players toward colleges that wore Adidas, like the University of Miami.
BRAD AUGUSTINE: (00:17:54) I was looking at it like, “Okay. If the kid’s kinda leaning toward Miami, well, we need Adidas to step up,” right? “If we’re gonna help the brand,” which– a five-star kid going to one of your premier schools helps the brand. If he’s gonna help the brand, I’m going to Christian and I’m saying, “Man. Like, what’s up? Like, we need to be taken are of.”
PAULA LAVIGNE: (00:18:12) Augustine had influence over where his players decided to go to college. And if it worked out, he was hoping to get points on their eventual contracts.
BRAD AUGUSTINE: (00:18:23) For me, it was a long-term play of, “Okay. Nassir’s gonna be our first pro. Right? That’s gonna change the game for our program. Like, because this kid’s gonna end up signing a shoe contract one day. And we’re gonna write it into his rider that our program is taken care of through the shoe company.”
PAULA LAVIGNE: (00:18:38) As their relationship grew, Dawkins introduced Augustine to people at Adidas. So just like he had with Under Armour, Augustine asked for a shot for Showtime Hoops to prove itself, this time on Adidas’ Gauntlet circuit.
BRAD AUGUSTINE: (00:18:57) Just let us play on the circuit and give us product. Give us jerseys, shoes, bags, and backpacks. I don’t want anything else. And– and let me prove myself. And they agreed to it.
PAULA LAVIGNE: (00:19:07) Augustine seized an opportunity to attend an Adidas director’s meeting in Las Vegas early in 2017. That’s where shoe company executives and AAU program directors would meet and talk about the year ahead. And it’s where Augustine saw how the big apparel companies saw things.
BRAD AUGUSTINE: (00:19:29) If you weren’t sitting in that room, if you didn’t have a player that there’s an outside fringe possibility that at some point they were gonna be a professional basketball player, and let’s be honest, like if we’re approaching it from a capitalism standpoint, it’s brilliant.
PAULA LAVIGNE: (00:19:44) How did the shoe company reps communicate that to you? Were– were they– were they subtle about it? Or how did they deliver that message?
BRAD AUGUSTINE: (00:19:50) I mean, it– it– it was pretty direct. I mean, “Guys, like, we’re here for pros. That’s what we’re here for. If you don’t deliver, you’re done. You won’t be in this room next year.” And, again, there was nothing– there was no naivete about it. Like, that’s what shoe company basketball is. It’s not– Nike’s not funding a team here in Orlando because they send kids to college. They don’t care. They’ve got four or five kids on their team that could be NBA players at some point. That’s the model of their business.
PAULA LAVIGNE: (00:20:19) Augustine thought this time he did have a guy, Nassir Little, and a strong program. And he needed Adidas’ money, because he was burning through his own.
BRAD AUGUSTINE: (00:20:30) So I would say I probably walked out of that Under Armour year $15,000, $20,000 in credit card debt. My check came in. And it had to go to the house. And it had to go to the bills. And it went ev– literally– whatever was left over went back into the program.
PAULA LAVIGNE: (00:20:47) Augustine was sinking deeper into debt, but he didn’t see any alternative.
BRAD AUGUSTINE: (00:20:52) When you’ve got 30 young men that are looking at you, it wasn’t just like, “Oh. This is gonna be embarrassing for me if I don’t pull this off.” It’s, “These kids, and these families, and these coaches are depending on me to come through.” So now to be in that position. (EXHALE) I mean, I was– I was terrified.
PAULA LAVIGNE: (00:21:12) Augustine got the team through most of the season. But with one tournament left in Las Vegas, he was all out of cash. Augustine put all his hope in Christian Dawkins.
BRAD AUGUSTINE: (00:21:27) Christian had been telling me he was gonna get me some money for– for about a month, month and a half. And I hadn’t got it. But he told me he was gonna get it to me in Las Vegas. And so I said, “I need you to be positive about that, because I’m gonna fly my team out there. And I’m not buying– I can’t afford round trip. So I’m gonna buy one-ways.”
PAULA LAVIGNE: (00:21:44) Once there, he got a call from Dawkins inviting him to a meeting with an investor at the Cosmopolitan Hotel.
BRAD AUGUSTINE: (00:21:52) So he calls me and said, “Hey. We’re gonna go meet this guy. He’s got the money for you.” So I remember taking the elevator up to the highest floor you could go on the elevator, stepping off, and then there was another private elevator. We get on that elevator. And we go up to the top floor of the Cosmo.
(00:22:11) And I remember stepping off. And it was like something out of, like, an Ocean’s Eleven movie, right? Like the hallways, like, were like velvet walls. I’m like, “This is insane.” And so we knock on the door. The door opens. And, I mean, it was like open doors out to the Vegas skyline, like expansive balcony.
PAULA LAVIGNE: (00:22:32) Inside the room, Dawkins introduced Augustine to a couple of guys.
BRAD AUGUSTINE: (00:22:38) There was just some young dude in there– with his, like, shirt unbuttoned down to his navel, and like spiky hair. And that was supposedly his investor. And then– Marty– Marty was there as well.
PAULA LAVIGNE: (00:22:51) Marty was Marty Blazer, a financial advisor from Pittsburgh.
BRAD AUGUSTINE: (00:22:57) We were just shooting the crap, just talking.
PAULA LAVIGNE: (00:23:00) And then the topic of a player named Balsa Koprivica came up. Koprivica was planning to play for Augustine’s team the next season in 2018.
BRAD AUGUSTINE: (00:23:10) Louisville wanted him badly. And so the whole premise was– of the meeting was, “Okay. This guy is gonna give me this money and I’m gonna tell him the kid’s going to Louisville.” So, you know, we’re in there. And he’s like, “Okay. Yeah. Like, I’m gonna give you this money. This is for the mom and the family.” Mind you, the kid and the mom had no idea what was going on, right? So I’m– but I’m telling these guys, yeah, no, the mom needs this to live. You know, I gotta pay– I got bills that are associated with this kid, you know, whatever.
PAULA LAVIGNE: (00:23:35) The investor with the unbuttoned shirt handed Augustine an envelope full of cash.
BRAD AUGUSTINE: (00:23:43) And so I remember getting up, taking that envelope of money, leaving the Cosmo, and– and that was it.
PAULA LAVIGNE: (00:23:49) How much money was it?
BRAD AUGUSTINE: (00:23:51) It was right under 13 grand. It was like $12,700 bucks, somewhere in there.
PAULA LAVIGNE: (00:23:55) What did you do with the $12,700?
BRAD AUGUSTINE: (00:23:57) I– I bought us our flights home. And the rest just mainly went to recouping expenses. I mean, by that point, like I said, we were– I was so far in debt. Our– our whole trip was on my AmEx card. So it’s paying off my cards, trying to get the– the balances down.
PAULA LAVIGNE: (00:24:12) Augustine had done what he had to do to get his team home. But what he didn’t know was that the room at the Cosmo was bugged. The F.B.I. had the whole meeting on video. And Dawkins’ investor, who handed over the cash, he was an undercover agent. When Brad Augustine took that envelope of cash and walked out of the Cosmopolitan Hotel in Vegas, he became part of one of the largest bribery scandals in the history of college sports. The Feds had set him up. But, why?
TED DISKANT: (00:25:05) All right. Let’s do it.
PAULA LAVIGNE: (00:25:06) I talked with the prosecutors who pursued the case to find out.
TED DISKANT: (00:25:11) My name is Ted Discant, from 2012 until 2021, I was an assistant U.S. attorney for the Southern District of New York.
PAULA LAVIGNE: (00:25:19) The Southern District is sometimes nicknamed the Sovereign District of New York for its political independence, and ability to take on nationally high profile cases. SDNY is the prosecutor’s office that sent ex-Trump-attorney Michael Cohen to prison.
TED DISKANT: (00:25:36) Former New York– Assembly Speaker, Sheldon Silver.
PAULA LAVIGNE: (00:25:39) Bernie Madoff.
TED DISKANT: (00:25:40) Michael Avanati.
PAULA LAVIGNE: (00:25:41) Martha Stewart.
TED DISKANT: (00:25:43) Jeffrey Epstein. And then– Ghislaine Maxwell.
PAULA LAVIGNE: (00:25:46) In 2022, SDNY set its sights on imploded crypto currency giant, FTX, and its founder Sam Bankman-Fried. SDNY started investigating college basketball thanks to Marty Blazer. He’s the now-former financial advisor who Augustine met at the Cosmo. Blazer had gotten caught stealing money from clients, mainly professional athletes, and investing it in a number of failed ventures. This included a truly terrible horror movie called A Resurrection.
PAULA LAVIGNE: (00:26:30) When I client discovered that Blazer had forged his signature to help pay for that, Blazer had to pay him back, in part by stealing from his other clients. In 2014, Blazer offered to give the government dirt on college sports as part of a proposed plea bargain.
(00:26:49) See. Blazer has already been part of a bribery scandal involving college football. And through mutual connections, he knew what Dawkins and others were up to with basketball coaches. Blazer agreed to become an informant, to help the Feds expose corruption in college basketball.
TED DISKANT: (00:27:07) Many investigations start with– with a tip, with a bit of information.
ANDREW GOLDSTEIN: (00:27:12) It was more of a bottom-up than a top-down.
PAULA LAVIGNE: (00:27:16) This is Andrew Goldstein. At the start of the investigation, Goldstein was chief of the unit handling the case. But he left before the cases went to trial.
ANDREW GOLDSTEIN: (00:27:26) As we looked at these relationships that Marty Blazer had, and we saw the way that these financial advisors and coaches were operating, then it struck us, there is some real corruption here. And let’s investigate that as hard as we can investigate it. And let’s see how much of that we can ferret out, and figure out who were the wrong-doers there.
PAULA LAVIGNE: (00:27:47) Blazer told prosecutors about a complicated web of college coaches, apparel companies, financial advisors, grass roots programs, players, family members, and large sums of money. So the Feds started investigating the bag game. They set up wire taps and heard a lot, including a conspiracy to get athletes to attend schools sponsored by Adidas. (PHONE RINGING)
MERL CODE: (00:28:22) What’s going on, brother?
JIM GATTO: (00:28:23) Yeah. What’s up?
PAULA LAVIGNE: (00:28:25) This is a phone conversation between an Adidas consultant named Merl Code and Adidas market executive James Gatto, who we heard about in the last episode. They’re talking about Nassir Little, Augustine’s star play.
MERL CODE: (00:28:40) So here’s the deal. The kid– there’s a kid named Nassir Little, who’s top five or six in the country, who Larrañaga and those guys really want.
PAULA LAVIGNE: (00:28:48) Jim Larrañaga is the head coach of the University of Miami, an Adidas school.
MERL CODE: (00:28:55) The probably is Arizona has offered the kid 150. And we’re trying to keep him from going to one of their schools.
PAULA LAVIGNE: (00:29:02) The University of Arizona is a Nike school.
MERL CODE: (00:29:07) So it was brought to me through Brad and Christian, who said, “Hey. Do you think Jim would be able to keep him at Miami, ’cause they really wanted the kid.” And I said I don’t know the answer to that. I’ll have to ask Jim if he’s willing to do that. I don’t know how, and what, and where, and where– you know, why, and blah, blah, blah–
JIM GATTO: (00:29:28) Well, he’s go– he– he’s got– he’s gonna– he’s gonna be a senior, right?
MERL CODE: (00:29:31) Yes. He’s– he’s a rising senior.
JIM GATTO: (00:29:35) When would they need the money?
PAULA LAVIGNE: (00:29:38) The recorded calls gave government investigators scraps of evidence: Stray mentions of names and dollar amounts. But it’s not like anyone gets on the phone and explains the whole scheme like some kind of movie villain.
TED DISKANT: (00:29:53) When people see wire taps on– on television, and in movies, you know, there are a bunch of agents sitting around listening to every word. And– and the entire story comes– comes together. In practice, you’re usually talking about fitting together bits, and pieces, and snippets of conversation, and trying to understand what frequently-coded conversations are about.
MERL CODE: (00:30:15) And then August 25th, Louisville needs to get five grand in an account for– the– the big kid from Florida that– that– that Brad Augustine is the guy who Jeff met, and– and Marty met. And he’s gonna, you know, be expecting on August 25th, five grand for the big kid that Louisville’s trying to get.
TED DISKANT: (00:30:33) As the picture started to come into focus, it became increasingly clear that what we were listening to was a scheme to make a very large payment to the family of a student athlete, in a manner that these scheme participants themselves seem to understand was highly problematic– and– and ultimately illegal.
PAULA LAVIGNE: (00:30:52) The wire taps show that the conspirators were trying to cover their tracks, not always successfully. Here’s a call between Dawkins and TJ Gassnola, the Adidas bag man we met in the last episode. In this call, Gassnola is scolding Dawkins for blabbing about the $100,000 they were arranging for a player to go to an Adidas school.
TJ GASSNOLA: (00:31:16) I adore you. I think the world of you. And I take care of you. That shit right there, I don’t talk. Like, that shit right there gets people in trouble. Now, you can say– you can do this: Yo, if you go here, I can take care of this. I get that. That’s fine. But names and money, you can’t do that. ‘Cause I like this guy a lot, and I’m gonna help him. Okay? And I brought order back to the situation yesterday, ’cause God knows there’s a bunch of fucking idiots around– around me at Adidas who don’t shut the fuck up. It’s brutal.
PAULA LAVIGNE: (00:31:45) The F.B.I. tried to get the conspirators to explain their scheme on the record. Here’s Adidas consultant Merl Code again, laying out the bag game in a meeting with undercover agents.
MERL CODE: (00:31:58) It’s a corrupt space as it is. And cheating is cheating. Whether I give you a dollar, $100,000, or I get your mom and dad jobs, it’s cheating, right? So in some form or fashion, Duke, North Carolina, Syracuse, (UNINTEL), all of those schools are doing something to help get kids. It– it– that’s just a part of the space.
PAULA LAVIGNE: (00:32:18) The F.B.I. also set up a meeting with Christian Dawkins and his business associates on a two-story yacht in a Manhattan Marina with undercover agents Jill Bailey and Jeff DeAngelo. The agents were posing as a young, wealthy couple. DeAngelo wore khaki pants, Sperry boat shoes, and a sweater tied around his neck.
(00:32:38) Bailey and DeAngelo were supposedly celebrating their new business venture with Dawkins to pay for top college basketball recruits. They had a duffel bag with tens of thousands of dollars in cash to seal the deal. The F.B.I. agents brought wine and a hidden camera.
FBI AGENT: (00:32:57) Well, this is the way to do business, right, Christian?
CHRISTIAN DAWKINS: (00:32:59) Yeah. I like it. I like it so far.
PAULA LAVIGNE: (00:33:02) The conspirators took the money. But later, they started to get a little nervous about Bailey and DeAngelo, their new business partners. In this call, Code and Dawkins are talking about how odd it is that Google doesn’t turn up anything on their two investors.
MERL CODE: (00:33:21) Here’s what. Here’s– just going through this shit, like, I need– you and I to protect ourselves, man. And I’m just– I’m saying this just as a guy who’s real skeptical about this shit, you– you and I need to get some background information on Jeff and this chick.
CHRISTIAN DAWKINS: (00:33:37) Okay.
MERL CODE: (00:33:38) Like, and I’m just telling you to protect your own ass, and where she comes from, and where her money come from. Your name is gonna be tied to her. My name is gonna be tied to her. And I cannot feel good about these folks. I don’t know ’em. And I’m looking up Jeff DeAngelo and can’t find nothing on him. And that shit is really concerning me.
PAULA LAVIGNE: (00:33:54) Those misgivings didn’t keep Dawkins and Code from continuing to business with the undercover agents. So using the recorded phone calls, meetings with undercover agents, and other evidence like emails and text messages, SDNY built a case.
(00:34:15) Their investigation rolled up guys like Christian Dawkins and TJ Gassnola, as well as Merl Code, James Gatto, and Brad Augustine. The meeting on the top floor of the Cosmo Hotel in Las Vegas was a key piece of the government’s evidence. And, a side note, it came out years later that one of the F.B.I. agents there that day removed thousands of dollars in government cash from the room’s safe, and lost it playing blackjack at the casino.
(00:34:49) He eventually pleaded guilty to one misdemeanor count of conversion of government money. The F.B.I. denied all of our interview requests for this series. So after that Vegas hotel sting, the F.B.I. had Augustine on tape, agreeing to steer a player to the University of Louisville in exchange for just under $13,000.
(00:35:15) A few weeks after Augustine took the money from the meeting in Vegas, he got the call from Dawkins inviting him to New York City to meet his investor, the undercover agent, Jill Bailey. The morning Dawkins and Bailey were supposed to meet with Augustine, the F.B.I. arrested Dawkins in his room at the W Hotel, which brings us back to Times Square, where Augustine learned he was indicted on Twitter. Back home, his wife, Alexa, was also getting the news.
ALEXA AUGUSTINE: (00:35:48) By the time I get home, my phone is blowing up, just text after text, phone call after phone call. My phone actually froze. And when it finally unfroze, I– I answered it. The first person who was calling in was a mutual friend of ours. And at this point, I had no idea what was going on. And I’m so confused. And he’s like, “Just turn on ESPN right now.”
NEIL EVERETT MORFITT: (00:36:11) Let’s bring in our basketball insider, Jeff Goodman. And, Jeff, when they say the investigation continues, you think, “Uh-oh. What else is there.” So what else is there?
JEFF GOODMAN: (00:36:19) That’s exactly what I think, Neil. And we don’t know exactly what there’s going to be. But what we do know is there’s 10 people that have been arrested, that could all roll, and give other names to the F.B.I. And– and that’s what–
PAULA LAVIGNE: (00:36:33) Augustine didn’t know what was happening or why, just that he was in trouble. First he called Alexa. And then he called the F.B.I. to turn himself in.
BRAD AUGUSTINE: (00:36:45) And I just sat there. And 45 minutes later, four guys in suits get off the elevator. From there, they took my phone, took my computer, took my backpack, and walked me downstairs. And– they handcuffed me and put me in the back of a car. And so I’m sitting in the back of a Crown Vic with my hands cuffed behind my back, with– a Fed on my left and my right, and two in the front seat.
(00:37:11) And, you know, mind you, they’re doing their job, right? “Oh. You’re going to jail. You’re going to prison for 80 years. And you have no idea. You know, you better– you know, you better tell us everything we wanna know.” And I just remember at one point– like, laughing. Like, “What are you guys talking about? Like, what– what– what did I do?” And I just remember asking that question over. Like, “Guys– why am I here?”
PAULA LAVIGNE: (00:37:32) Brad Augustine knew it was a violation of NCAA rules to take shoe company money for steering players to certain schools. But he had no idea it was a crime. And as the F.B.I. made its arrests in the case, that was a common reaction.
MYRON MEDCALF: (00:37:49) When you tell me bribery scandal, like, I imagine a scene from Goodfellas or something like that. I mean, that– I thought the F.B.I. only showed up when, like, the Mob was involved.
PAULA LAVIGNE: (00:38:00) That’s ESPN’s Myron Medcalf again.
MYRON MEDCALF: (00:38:03) Literally. I did– I honestly didn’t know, like– I didn’t know the F.B.I. could get involved with something like college basketball. At these events on the circuit, there– there’s not this sense of evil happening. The F.B.I. made it that. But that’s not what’s happening, man. Of course you know money’s exchanging hands. And of course you understand that things are happening that would be NCAA violations. Are they life violations? Everybody’s in it, man. If this thing is dirty, we all got mud on us, man, all of us.
PAULA LAVIGNE: (00:38:43) Coming up in our next episode, prosecutors announce the arrests and outline the bag game.
MALE REPORTER: (00:38:52) Coaches at some of the nation’s top programs soliciting and accepting cash bribes.
MALE REPORTER: (00:38:58) There were discussions primarily, “What’s gonna be the next shoe to drop? How far is this going to go?”
PAULA LAVIGNE: (00:39:05) And Billy Preston waits to hear his name in the NBA draft.
BILLY PRESTON: (00:39:11) If I was able to play that whole year at KU, it would’ve been a whole different outcome.
PAULA LAVIGNE: (00:39:15) That’s in the next and final episode of the Bag Game. The Bag Game is based on reporting by me, Paula Lavigne, and Mark Schlabach, for ESPN’s investigative unit. Senior producer is Matt Frassica. Senior editorial producer is Eve Troeh. Line producer is Cath Sankey.
(00:39:52) Associate producers are Gus Navarro and Meghan Coyle. Production assistants are Diamante McKelvie and Isabella Seman. Archival producers are Meghan Coyle and Jiyoung Park. Music by Braxton Cook with additional composition, scoring, and sound design by Hannis Brown.
(MUSIC NOT TRANSCRIBED) (00:40:15)
