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Don Narcisse was the Warren Buffett of Canadian Football.   His performance numbers over a long career speak for themselves.  A small receiver (5′9″), Narcisse began his career in the CFL with the Saskatchewan Roughriders in 1987 after being cut from the St Louis Cardinals.  The rest was history.

Here are some of his stats after a 13-year football career:

• 216 games, 919 receptions, 75 touchdowns, 12,366 yards
• 8 – 1000+ yard seasons, 2 – 900+ yards seasons
• 34 – 100+ yard games
• Led CFL in receptions (123) – 1995

With numbers like this, he is first, second, or third for most all-time records in the CFL for receivers.

Know for his hard work and  sure hands, Narcisse was notoriously frugal when it came to spending:

Former Rider kicker Dave Ridgway said the man who wore No. 80 took great pride in being parsimonious, saving his meal money while other players spent it on the road.

If the players received $150 per diem for a road trip, “anyone guessing Narco has anything less than 108 bucks remaining in his pocket is going to lose the bet,” Ridgway wrote in his 1995 biography, Robokicker.

“When Don Narcisse decides to retire, he will leave the CFL with nearly every dollar he made playing football.”

Narcisse knew the value of the dollar (Canadian) and set out to preserve whatever wealth he had amassed during his prolific career — which makes the ending of the story all the more heartbreaking.

Not unlike academics or artists, professional athletes have high earnings power for just a short amount of time: most, in fact, do their best work before the age of 27.  Many make enough money that they should never have to work again.   Others, though, as I wrote in a previous piece, blow through their millions in a few years with little hope for a job or a future.

Narcisse wanted to preserve what he had worked so hard to secure: his financial security.  Teammates were astounded to learn this week that the famous receiver lost his $65,000 football pension to what police now say was a complex investment scam involving offshore accounts and promises of fantastic financial payoff.  So scrupulous in his work ethic and money management, Narcisse fell prey to the worst type of scoundrel: a fellow teammate.

According to reports, in 2003, Narcisse hooked up with former teammate,  Ventson Donelson, who introduced him to Graham Dorn, a promoter with Capital Alternatives of Calgary, which was eventually renamed The Institute for Financial Learning, or IFFL.

From the looks of it, the IFFL was certainly not an innocuous educational investment club; rather, it was a multilevel marketing scheme that promised outrageous returns to its cult-like followers.  This September, Ponzimonium broke out across North America with Madoff and Stanford and the founders of the IFFL were indicted on multiple accounts of financial fraud — estimated at up to $400 million.

With promises of financial freedom through education and complicated tax schemes, the IFFL found a welcome audience in professional athletes, many of whom were struggling with retirement — emotionally, physically, and financially.  According to the National Football League Player Association, 78 pro players over a three-year period this decade were defrauded more than $42 million by financial advisers.  I’m sure the numbers haven’t improved over the past 2 years.

Why?  Why are professional athletes prone to getting swindled?

I posit 5 reasons:

• Unrealistic expectations: Athletes are gods on the field, doing things with their bodies that normal humans can’t.  The thing is, when they re-enter “real life”, frequently having run through large sums of money, they struggle with making a living and planning for the future.  This shock of reality hits athletes hard.   People in desperation want to believe there is an easy way out — a magic bullet.  Not coincidentally, the IFFL’s main product was called Midas.  When U.S. treasury bonds are paying close to 0%, it’s outlandish to believe that you could — with little risk — expect high double digit returns in such an environment.  The defrauded were sold a false dream and because of their desperation believed that it could be true.  Believing in an investment plan is not a substitute for a safe strategy.

• Lack of financial experience and education: Many professional football players complain that they lack the tools to adequately manage their financial estates.  They don’t like having to rely upon professional financial advisors — many of whom are out to fleece them.  Knowledge — and the independence that follows — is really central to the story here.  The IFFL didn’t claim to sell anything or promote investments — it sold knowledge and found sufficient demand in the athlete investment community.  Athletes need access to objective sources of education and information and must be able to read between the lines to decide whether something is objective or subjective — just like all investors must do.  Mutual funds charge fees — that doesn’t mean that they’re bad.  Athletes must understand how  fees affect their overall performance and whether expected returns justify them.

• Advisor selection: Granted, just because someone is a professional doesn’t mean he’s trustworthy.  What’s more important is to surround yourself — whatever field you’re in — with sound, responsible advice.  The IFFL worked as a scam because everyone was in on it.  Friends recommended it to friends.  No true friend/adviser should have promoted the IFFL to Narcisse knowing his demeanor and attention to financial detail.  Unlike on the field, where players frequently give selflessly to help one another, real life means that everyone is out to make a buck.  It’s important to understand everyone’s motivations when analyzing whether given advice is trustworthy or it’s just a sales technique.

• Liquidity also has a value: Narcisse began to sense something wasn’t kosher when he asked for his money back and was given the run around.  Complicated real estate transactions tie up investment money for years.  While plain vanilla government bonds return very little on investor money, they’re easily liquidated into cash.  Investments must be assessed using liquidity guidelines.  Real estate and small business must be looked at with this in mind.

• Waiting until retirement to address financial planning: Take a page from Chad Ochocinco’s book (or, more aptly, from his app): he’s thinking about monetizing his skills and reputation during his career.  This helps to optimize earnings potential during an athlete’s career and puts the athlete in the right frame of mind to begin a second career, post-football.  Do I care enough to pay $5 to follow all of 86’s off-field exploits?  Nah, but someone  does.

Narcisse’s is a heart-breaking story because he did everything right financially during his career.  Unfortunately, he made one bad decision that cost him dearly.  Professional athletes can’t afford to get bad advice anymore: not from friends or from sleazy professionals.

I like this story about responsible financial planning within the NFL. The article quotes cornerback, Dre Bly:

“My retirement goal is to be able to maintain my current standard of living and send my kids to college without having to work again,” Bly says. “I’m looking for safer returns that I can count on being there when my career is over.”

Unfortunately, there aren’t a whole lot of ways to get there other than by saving and investing safely.  Players who try to find a more sexy, aggressive way of doing it are, unfortunately, going to end up like Narcisse — in a Ponzipalooza smack down.

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