The NFL Players Association, a Washington, DC-based organisation which represents 1,700 players in the American National Football League, has formally amended its list of requirements for financial advisers who wish to look after its members to stipulate that they hold either the CFP or CFA designation, or both.
Those who currently are already Registered Player Financial Advisors with the NFL Players Association (NFLPA) have three years to comply, the organisation says.
The news emerged earlier this month, and comes as the names of many top European football players continue to appear in stories about failed tax avoidance products, and related issues having to do with poor financial advice.
In September, for example, it was announced that what was described as a class action lawsuit was being brought by some 45 former Premier League football players against an investment group that had recommended they invest in a film investment scheme that was later declared by the UK tax authorities to have been conceived for tax avoidance rather than investment purposes. As a result of this finding by the authorities, these players and some 77 other investors in the scheme faced a total tax bill of £700m.
‘Holistic approach’ sought
According to a spokesperson for the NFL Players Association (NFLPA), the organisation decided to add the requirement that those advising its players hold the Certified Financial Planner or Chartered Financial Analyst designations “because we want to ensure that NFL players are provided access to financial advisers that utilize a holistic approach when developing financial plans for their player clients”.
The spokesperson said the NFLPA recognised that those holding such credentials had to meet “rigorous requirements” to obtain the designations, and that those who had qualified as CFPs and CFAs also would have “completed extensive training and experience requirements, and are held to rigorous ethical standards”.
“They understand the complexities of the changing financial climate, and know how to make financial planning recommendations in best interest of their clients.”
“The CFA credential is the most respected and recognised investment management designation in the world. Our intent is to provide players with access to investment advisers that have mastered a broad range of practical portfolio management and advanced investment analysis skills.”
The new requirement appears on page 7 of the 45-page NFL Players Association Regulations and Code of Conduct Governing Registered Player Financial Advisors, and reads as follows: “The following requirements shall apply to all applicants:
“…Every applicant shall be a Certified Financial Planner (CFP) and/or a Chartered Financial Analyst (CFA).
“An individual who is currently a Registered Player Financial Advisor, but is not a CFP or CFA, must become compliant within three years of implementation of this regulation.”
According to the US financial publication, WealthManagement.com, the new requirement has been “well received by those in the industry familiar with fraud cases NFL players have brought against their advisers in recent years”.
In an article on the new requirement earlier this month, the publication quoted Ryan Shanks, the founder and chief executive of a consultancy called Finetooth, as saying the new requirement had been “a long time coming”, given that football players typically come into a lot of money when they are young, are not knowledgeable of finance or markets, and often falsely assume members of the program are vetted by the organisation.
The NFLPA was established in 1956 to represent the league’s players’ interests, originally as a union. In 1993 it re-asserted itself as a union, and thus is able to negotiate players’ wages through a collective bargaining agreement.