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Wednesday, August 1, 2007
Nene's Financial Mess


I have been beating the drum, a little, that it is a mistake to assume that all NBA players are on sound financial footing.

The best way to think of it is like they are each and every one of them a corporation with both decent revenue and significant expenses. 

Corporations like that end up with positive net worth ... sometimes. It takes deft management to make it happen. It also takes a chief executive who is at least interested in managing the business at hand, instead of handing the controls to some dude he met in Brazil a few years ago, if you know what I mean.

When you're that out of touch with your finances, it can be nearly impossible to know whether you're being ripped off or not. I can tell you this: life is more expensive than you think. 

James Paton of the Rocky Mountain News reports on Nene's claims and counterclaims involving his former business manager.

The Denver Nuggets forward has accused Joe Santos of failing to fulfill his duties as manager and personal assistant and to keep adequate financial records. He also has said Santos diverted funds for personal use.

The Brazilian big man claimed in a March lawsuit that while he earned more than $2 million a year and "thought his financial position was sound," he learned in January 2006 his net worth was actually in the red. After the startling discovery, he terminated his pact with Santos, according to the document.

"A significant part of the money earned by Nene cannot be accounted for from records managed by Santos," the lawsuit in Denver District Court stated.

Santos "categorically denies" the allegations, his lawyer, David TeSelle, wrote in an e-mail Tuesday, and has countered with slander claims against Nene.

Now, of course, Nene has a much bigger contract that pays him close to $10 million a year. He ought to be able to get back in the black in a hurry. But consider yourselves warned, NBA players: you have to have a real financial plan. You have to understand what's going on. No amount of salary is more than you can lose.