Jury Convicts Across the Board in Basketball Corruption Case

MANHATTAN (CN) – Wrapping up a nearly three-week trial on corruption in college basketball, a federal jury handed convictions all around Wednesday to a former Adidas executive and two co-defendants.

Former Adidas executive James Gatto arrives at federal court on Oct. 18, 2018, in New York. Gatto and two co-defendants were convicted on Oct. 24 of fraud related to charges that they plied families of NCAA college basketball prospects with cash so the prospects would attend colleges sponsored by Adidas. (AP Photo/Mark Lennihan)

The conviction of former Adidas executive James Gatto this afternoon comes over a year after the government unveiled an indictment that detailed a widespread conspiracy where coaches, managers, financial advisers and other officials used bribes to lure star high school basketball players to certain college programs.

Kicking off the trial on Oct. 2, prosecutors worked to show that such bribes harmed universities willfully because the payments to players’ families made those athletes ineligible to compete in the National Collegiate Athletic Association.

Alongside ex-business manager Christian Dawkins and former amateur league coach Merl Code Jr., Gatto was convicted this afternoon on two counts of conspiracy to commit wire fraud and wire fraud related to the University of Louisville. Gatto was also found guilty of one count of wire fraud related to the University of Kansas.

While the government tied the payment pipeline to motivations of greed and careerism, defense attorneys for the trio argued that the schools’ athletic departments, including the highly paid coaches, encouraged and facilitated the cozy relationships with the recruiters and industry fixers on trial.

The 12-person jury, made up of eight women and four men, began deliberations Monday, at one point calling on the court to provide the testimony of a cooperating witness who pleaded guilty to wire-fraud conspiracy. Thomas “T.J.” Gassnola was the former director of the New England Playaz, a high-level amateur basketball team based in Western Massachusetts.

Kansas forward Silvio De Sousa tips the ball away from West Virginia guard James Bolden during the second half of an NCAA college basketball game in the finals of the Big 12 men’s tournament in Kansas City, Mo., on March 10, 2018. Kansas defeated West Virginia 81-70. (AP Photo/Orlin Wagner)

During the trial, Gassnola testified that he had made payments to the families of five student-athletes who were “on Jim’s radar,” referring to Gatto.

Such payments included $20,000 to the guardian of Silvio De Sousa.

In its request for Gassnola’s testimony, the jury specifically mentioned an August 2017 text exchange between Gassnola and Gatto, which discussed Silvio De Sousa and the University of Kansas, an Adidas-sponsored school.

Michael Schachter, an attorney for Gatto with the firm Willkie Farr, told the jury during trial that Kansas head coach Bill Self had “requested” Gassnola  facilitate the $20,000 payment be made to the guardian for De Sousa in order for Adidas to keep its sponsorship deal with the school.

Since De Sousa and Self’s names surfaced in the federal trial, the University of Kansas benched the Angolan sophomore forward from play pending a review of his eligibility.

Reacting to the close of the trial, Coach Self announced in a statement Wednesday that the university was pulling De Sousa.

“Information was presented during the current trial in New York — some of which we knew, some of which we didn’t,” Self said in a statement. “We have decided to withhold Silvio from competition until we can evaluate and understand the new information. We have already discussed trial developments with the NCAA and will continue to work with NCAA staff moving forward.”

Former amateur basketball league director Merl Code arrives at federal court on Oct. 18, 2018, in New York. (AP Photo/Mark Lennihan)

Attorneys for Gatto and his co-defendants argued meanwhile that the government had not made plausible cases for any specific intent to defraud the universities when the recruitments occurred to help the universities and apparel companies.

During his closing arguments last week, attorney Schachter described the payment arrangement as a “win, win, win” situation for Adidas, the universities and the families of the players.

A representative for Adidas said the company respects the verdict.

“We look forward to continuing to work with the NCAA and other stakeholders in a collaborative and constructive manner to improve the environment around college basketball,” the company said in a statement.

“We have strengthened our internal processes and controls and remain committed to ethical and fair business practices.”

Representatives NCAA did not immediately respond to requests for comment Wednesday afternoon.

U.S. District Judge Lewis A. Kaplan presided over the trial in Manhattan, with Assistant U.S. Attorney Edward Diskant from the U.S. Attorney’s Office’s Public Corruption Unit leading the prosecution.

The jury deliberated for two and half days this week, staying as late as 8:30 pm Tuesday night without reaching a verdict.

During the selection process, none of the jurors identified themselves as being more than casual fans of college basketball.

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