Approximately 225 financial professionals have applied to be certified under the NFL Players Association’s revamped financial advisers program, down from the 350 advisers who were certified under the old rules.
The NFLPA’s board of player representatives earlier this year passed new and more stringent regulations for the financial advisers program, including requirements that advisers have more experience and pass a more detailed background check.
There had been 350 financial advisers in the NFLPA’s old financial advisers program when it went on hiatus and stopped taking new applications about three years ago. Since the program closed to new applicants, about 750 additional advisers signed up for a waiting list to apply when the program reopened.
Registration for the new program opened on Aug. 1 and closed on Nov. 30.
Dana Hammonds, NFLPA director of player services and development, in a telephone interview last week, did not identify the 225 advisers who applied to be certified under the new rules. But she said it appeared that most of the applications for the new program came from advisers who had previously been in the program and not from the advisers on the waiting list.
The decline in the number of advisers who applied was expected for a number of reasons, Hammonds said. For one thing, the more extensive background check necessitated raising the application fee from $1,500 to $2,500.
Additionally, NFLPA-certified financial advisers are now required to carry a minimum of $4 million in liability insurance. Previously, there was no minimum amount to the liability insurance that advisers had to carry. Also, the years of experience required was raised from five to eight, and advisers were required to indemnify the NFLPA against any lawsuits player financial clients may bring against them.
“Everything had an impact,” Hammonds said of the decrease in the number applying for the program. “When you go from five years to eight years of experience, in terms of new advisers getting into the program, that is going to exempt a lot of individuals who had just not been in the business that long. The cost of being in the program may not make business sense to some advisers, especially if they don’t have a lot of player clients.”
NFLPA player leadership passed the new rules at its annual meeting in March as an attempt to protect its members. A number of NFL players have filed lawsuits against financial advisers in recent years and there have been a number of stories of players being broke shortly after retiring from the NFL.
The new background check on financial advisers will take from 30 to 90 days to complete and is being conducted by Chicago-based security and investigative services firm Hillard Heintze.
Hammonds said she hopes to have a list of advisers certified under the new program to distribute to NFL player members by the end of January.