Fed-Up NIL Collectives Are Bypassing NIL Deal Approval Process

Multiple major power conference collectives are giving up on trying to work through the NIL Go clearinghouse and within the bounds of the new rules set up by the House v. NCAA settlement, Front Office Sports has learned.

At least two collectives have begun to pay players before the submitted deals have been approved, and are aware of instances where players haven’t logged deals at all, sources tell FOS. The inefficiencies of the system have created an unsustainable landscape, they said.

“I have deep concerns as to the longevity of this system,” a source from an ACC collective said, adding that many across the industry desperately wanted the system to work but now feel like they have no choice but to violate the rules.

“The rules created by the House settlement around third-party NIL deals are actively in place and enforceable and apply to all current NCAA Division I student-athletes,” a College Sports Commission spokesperson told FOS in response. “Pay-for-play deals are not allowed under the rules and will not be approved in NIL Go. There is no safe harbor for breaking these rules and there will be eligibility consequences for student-athletes who do not follow them.”

After the House settlement was approved in June, the power conferences launched the College Sports Commission to enforce the settlement’s new rules. Among them: Division I athletes would have to submit every NIL deal they receive valued over $600 for scrutiny and approval, to ensure it was for a “valid business purpose” and offered fair-market value and not pay-for-play in disguise. They partnered with Deloitte to create software—called NIL Go—to receive submissions, which must come from players themselves.

Since NIL Go launched in mid-June, however, players, agents, and NIL collective operators have told FOS they’ve waited weeks or longer to receive any feedback on submitted deals. (Last month, a group of collectives reported that about $11 million worth of deals were stuck in limbo.) As a result, many across the industry have begun to eschew NIL Go altogether.

Two SEC collectives have begun to compensate players for NIL deals that have been submitted to NIL Go but not yet approved, two sources from the collectives told FOS. 

In the case of one of the collectives, agents and players had begun badgering them for payments on deals that hadn’t been approved yet, one of the SEC collective sources said. So the collective decided to pay out some of the smaller deals—worth in the four-figure range—that haven’t gotten approval yet. 

The source at the other SEC collective said multiple deals their athletes had submitted have been languishing in NIL Go for weeks, so the collective decided to go ahead and pay players. They said that their athletic department had reached out to NIL Go for assistance, but hadn’t heard back.

The source from the ACC NIL collective said that they were nearly ready to circumvent the NIL Go system and preparing to pay players for deals that had been submitted but not approved.

It’s not just that brands and collectives are paying players without NIL Go’s signoff. In some cases, players aren’t submitting them at all. 

The first SEC source said that out of close to 70 agreements sent to football players in August, only about 20 had been submitted to NIL Go as of Oct. 1. The source cited multiple reasons: Players didn’t know how to use the software, didn’t care to use it, or didn’t want to submit the deal for fear of it being rejected. What’s more, there’s really no way for collectives or brands to confirm that deals have been approved through NIL Go. 

“It’s creating a very uncomfortable situation for everybody involved,” the first SEC source said.

It is unclear how the CSC would police these rules violations. The CSC would have to scrutinize thousands of athletes’ deals, whether submitted to NIL Go or not. For example, that could mean scouring players’ social media accounts to see whether the deals they submitted matched the deals they posted to their Instagram or TikTok accounts. The CSC told FOS it’s setting up an anonymous reporting tip line to assist with the process, but that may not be efficient enough. 

The CSC has just four full-time employees to evaluate all submitted deals, investigate alleged rules violations, and enforce punishments. The organization has enlisted members of Deloitte and an outside law firm to help.

“We’re literally looking at a system collapsing [within] the first five months of it being launched,” the ACC collective source said.