NY attorney general penalizes scouting service for deceptive advertising, defrauding families

NY attorney general penalizes scouting service for deceptive advertising, defrauding families


NY attorney general penalizes scouting service for deceptive advertising, defrauding families

The National Scouting Report, Inc., one of the oldest college sports recruiting services in the country, has agreed to pay $20,180 in penalties, restitution and costs to the New York Attorney General’s Office for deceptive advertising, breaking state business laws and defrauding the families of student-athletes, the attorney general announced Thursday.

“Preying on the hopes and aspirations of New York’s young, devoted athletes is incredibly cynical,” New York Attorney General Eric Schneiderman said in a statement. “Students who are attempting to use their athletic promise to further their educational opportunities should not have to worry about being exploited by those seeking to make a profit, without any consideration for their success.”

The attorney general’s findings concluded that NSR did not have a business license to operate in New York, that the company’s contracts with the athletes did not have the required notice that allows a three-day period to cancel, that NSR could not back up its various promotional claims, including those that said that 90% of student-athletes who used its service received athletic scholarships from NCAA, NAIA or NJCAA schools or that its recruiting service was resourced by more college coaches than all other recruiting services combined.

Rusty Rigby, the president of NSR, said his company agreed to pay the settlement costs because it became too expensive to fight the findings.

“This penalty that I had to pay is very small,” Rigby said. “What I did learn is we are not successful in anything we do because of what it says on the web site. Our web site and social media, we have to be so, so careful. We’re dealing with people’s children. …  If it’s out there, you have to stand by it. To prove those things, we need to have more documentation and to do that, it cost more than we wanted to generate.”

In addition to the settlement costs, the agreement requires that NSR change its promotional and advertising materials where needed, apply for the proper business licenses in New York, change its contracts to allow a three-day period to cancel and train its employees on what claims the company can make, and cannot.

Michael John, then a baseball player for St. Edmund Prep (Brooklyn), was at a training facility in Queens when he was approached by Enrico Derooy, a scout from NSR, during the winter of his junior year. John was one of four baseball players from the school who were contacted by Derooy. The parents of all four players, after home visits by the scout, paid $3,295 to NSR to help them land athletic scholarships.

NSR, based in Alabaster, Ala., has been in business since 1980. When Michael’s mother, Jeanne Finnigan-John, checked into the company, everything seemed legitimate, she said. But shortly after paying NSR, calls from the parents to the scout were not returned. As it turns out, Derooy had left the company without helping any of the four get an athletic scholarship.

“This guy didn’t pan out and they didn’t do anything else to help us,” said Finnigan-John, who is a teacher and a coach at the Nightingale-Bamford School in Manhattan. “It’s not that the scout did a bad job. He didn’t do any job. We didn’t sue, but we just wanted our money back. We signed with NSR in March of Michael’s junior year and it took almost that whole summer to get anyone from NSR to respond.”

Finnigan-John contacted a local councilman, who helped her contact the state attorney general’s office.

Rigby said his company employs roughly 150 scouts across the country and all of them are considered independent contractors who get a week’s worth of training with NSR before going out into the field.

Rigby also said that his service ultimately helped the four players from St. Edmund Prep land scholarships, but Finnigan-John said that isn’t true.

“None of them are playing college sports,” she said. “Michael is at St. Peter’s College (in Jersey City) on an academic scholarship. … It’s so sad because I think NSR has probably placed a lot of people in scholarships. I don’t think they are a totally rotten company, but they make money off these kids’ dreams.”

Finnigan-John’s younger son, Thomas, will be a junior next year at St. Edmund’s and plays basketball. She said she would hesitate to hire anyone to help him land an athletic scholarship.

“Unless I knew the person, I would steer clear of it,” Finnigan-John said. “I would say if your kid’s good enough to play in college, the college will find him.”

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