Scott Boras allegedly loaned Dominican players money. Is this a problem?

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The New York Times is reporting that Scott Boras, possibly in violation of MLBPA rules, made loans to Dominican prospects “raising questions” about whether his company “exploited the prospects.”  A spokesman for Major League Baseball said that “this is a serious issue that raises concerns about the business practices of agents who have played a prominent role in the game.”

The article outlines a loan Boras made to Braves’ shortstop prospect Edward Salcedo, to whom Boras made a $70,000 loan prior to his getting a $1.6 million bonus. At the time, Salcedo was seen as damaged goods, as an earlier deal had fallen through with the Indians because he turned out to be older than he previously said he was. Boras made the loan, the report says, time passed, during which a third party — trainer Edgar Mercedes — helped resolve the age issue — and then Salcedo signed his deal with the Braves. Boras then demanded repayment of the loan. Salcedo is still represented by Boras, even though Mercedes tried to get him to sign with a different agent. The loan has still not been paid back.

I get the potential seriousness of an agent giving big money loans to poor Dominican prospects: there is a potential for exploitation if the agent uses the leverage of the loan to coerce the player or to limit choices. Like any dealings with teenage athletes and their families, there are a number of sensible reasons to have rules in place regarding such transactions, regulating them, and requiring some sort of approval process or oversight to ensure that no one is being taken advantage of.  And, according to the report, the MLBPA apparently does have such rules.

But even if Boras violated these rules in the Salcedo case, I’m not seeing any evidence in this article that (a) anyone was taken advantage of; or (b) anyone was actually harmed.  Salcedo was hard-up. Boras loaned him money. Salcedo signed with the Braves. Boras asked for the money back. In the interim another person did some work that perhaps Boras should have been doing (i.e. helping resolve the age issue).  Again, this all may have been in violation of MLBPA rules, and if so, that’s serious in and of itself, but the article tries hard to cast this as an exploitation piece, and I just don’t see how, in this particular case, the loan to a prospect was exploitative in any way.

Indeed, the only hint at that that there was pressure of any kind comes in the last paragraph of the article, where it is suggested that Salcedo felt obligated to stay with Boras as a result of the loan. But that part is all based on quotes from that trainer, Edgar Mercedes, who is affiliated with another agent who wanted to snag Salcedo for himself.  That’s not exactly a damning indictment. And the fact that Salcedo continues to be represented by Boras despite the ability to fire him if he wanted to and having the financial means to easily repay the loan if he so chose, cuts against the notion that he is somehow shackled to Boras as a result of an overreach by the agent.

Could there be a problem here? Absolutely. If Boras has broken union rules regarding loans, that’s bad and should be investigated and punished if the allegation is borne out. But this piece was not written simply to highlight a potential violation of union rules. It was designed to be of a piece with the authors’ last article, regarding U.S. investors making money off of Dominican players by setting up training academies, casting it all into a “U.S. Baseball Exploits Dominican Kids” narrative.  While I said before that I believe there are serious problems with the training academies — i.e. in those cases, unlike Major League Baseball and even agents like Boras, the investors have no incentive to look after kids’ welfare after the signing bonus is paid —  this Boras story does not fit the narrative that the Times is trying to create. This merely points out a possibly troublesome  incident and even then doesn’t establish that anything untoward occurred.

So, unless and until we learn more, I’m not going to get too worked up by this. Just because kids in the Dominican Republic are involved does not mean they are being exploited. Just because Scott Boras is involved does not mean something bad is happening. We need to know more before getting out the torches and pitchforks.

Gallegos agrees to 2-year, $11M contract with Cardinals

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ST. LOUIS – Reliever Giovanny Gallegos and the St. Louis Cardinals agreed to a two-year, $11 million contract, a deal that includes a club option for 2025 and escalators that could make it worth $20.5 million over three seasons.

The 31-year-old right-hander is 3-5 with a 2.91 ERA and 14 saves in 20 chances this season. He has 72 strikeouts and 15 walks in 58 2/3 innings.

“I feel so happy,” Gallegos said before the Cardinals played the Pirates in Pittsburgh. “I don’t have the word for exactly how I’m feeling.”

He was obtained from the Yankees in July 2018 along with left-hander Chasen Shreve in the trade that sent first baseman Luke Voit to New York. Gallegos is 14-15 with a 3.02 ERA and 34 saves in six major league seasons.

Gallegos gets a $500,000 signing bonus and salaries of $4.5 million next year and $5.5 million in 2024. St. Louis has a $6.5 million team option for 2025 with a $500,000 buyout.

His 2025 option price can increase by up to $3.5 million for games finished in 2024: $500,000 each for 20-25 and 26-30 and 31-35, and $1 million apiece for 36-40 and 41 or more.

He would get $250,000 for winning the Rivera/Hoffman reliever of the year award, $50,000 for All-Star selection and World Series MVP and $25,000 for League Championship Series MVP.

Gallegos has a $2.41 million salary this year.

He was eligible for salary arbitration and is potentially eligible for free agency after the 2024 season.