Meet the Ex-NFL Player Whose UBS Team Keeps Athletes and Entertainers From Going Broke

Q&A July 06, 2022 at 03:53 PM

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Money makes the world go 'round, so that adage goes. But for many top pro athletes and entertainers, money sets them on a dizzying spin cycle that all too often ends with an abrupt fall.

However, here comes former 11-year NFL player Adewale (Wale) Ogunleye, 44, head of UBS's Athletes and Entertainers Strategic Client Segment.

"We feel it's our duty to teach our clients exactly what financial management is," he explains in an interview with ThinkAdvisor. "If it has a dollar sign, we want our advisors attached to it."

Those clients are some of America's biggest and brightest in the sports and entertainment worlds.

The UBS segment comprises 28 advisors who have earned the Athlete Entertainer Consultant designation after being trained specifically to help successful athletes and entertainers.

The firm approaches managing these stars' financial lives in the same way it handles those of entrepreneurs.

Though, to be sure, these folks need a special touch. "They don't know who to trust," Ogunleye notes, and "are scared when they see headlines of entertainers and athletes going broke."

Indeed, a white paper prepared by UBS Financial Services and released in June states that 8 out of 10 NFL players and 6 out of 10 NBA players "are in financial stress or bankrupt within 5 years of retirement from professional sports."

In the interview, Ogunleye — a Brooklyn, New York-born son of Nigerian immigrants — discusses how having loose parameters when it comes to giving or loaning money to family and friends can lead to "the breadwinner's emergency."

Playing with the Miami Dolphins, Chicago Bears and Houston Texans, Ogunleye was named the Dolphins' Most Valuable Player in 2004 and was the Bears' team captain, which in 2006 helped the team reach Super Bowl XLI.

When he left the NFL, Ogunleye headed straight for a career in business, earning an MBA in business administration and management from Washington University School of Business.

A UBS client, he joined the firm as director of sports and entertainment in 2019. The following year he created and launched the Athletes and Entertainers Strategic Client Segment.

ThinkAdvisor recently interviewed Ogunleye, who was speaking by phone from Weston, Florida, his base. Here are excerpts from our interview:

THINKADVISOR: Why is it imperative for entertainers and pro athletes to have a trustworthy financial advisor?

ADEWALE OGUNLEYE: There are so many different hands in their pockets. They don't know who to lean on. They don't know who to trust.

Most of the time they try to find someone in their inner circle to trust. But though a lot of times these people have great intentions, they just don't have the experience or knowledge to back up those intentions.

Don't entertainers' and athletes' business managers and agents look out for their money?

We would hope that business managers would put their clients' best interest first. But a lot of times you find that business managers' self-interest comes before the clients' — especially in Hollywood, where business managers want to have their hands in every single aspect of an entertainer's life.

That in itself causes a conflict of interest when it comes to double-checking taxes, making sure the entertainer isn't overpaying for things, what they're investing in, what kind of business they're getting into and [even] how much they're paying the business manager.

It gets really convoluted. The entertainers don't know what financial education or managing money is. So [they hope] these people will do the right thing even when they aren't watching their finances.

How does that work out?

With athletes and entertainers, unfortunately, there are a lot of times when they're not watching; and that's why a lot of them get into trouble.

The industry should deal with very reliable institutions and not fly-by-night guys that take your money today, put you in a Ponzi scheme, file for bankruptcy and go to another state under a new name and start all over again.

What's the biggest challenge for financial advisors working with athletes and entertainers?

These individuals have trouble understanding the jargon that financial advisors speak. And when they see the headlines of entertainers and athletes going broke, it scares them.

The hardest thing for advisors is to understand the mindset of an athlete and the ecosystem of people around them that are depending on them to make it.

This sometimes makes it a little difficult for advisors to navigate without getting into trouble.

Please explain why.

Staying out of trouble means making sure the athlete or entertainer is investing in the right things and that people in their ecosystem aren't hangers-on or a posse that's unbearable to work with.

Instead, they should be looking at the people around them as family members — community members — that have been there from the beginning.

What do financial advisors need to be super-aware of?

Advisors sometimes get athletes or entertainers into problematic or troubled waters when they view them with a stereotypical outlook and not case by case.

More importantly, they get into trouble by making [the interaction] a "transaction."

It should be a true relationship where you understand exactly how your client thinks about money and some of the factors when they were growing up that made them react the way they do when it comes to managing their assets.

What's your key approach to helping athletes and entertainers?

Treating them the way we treat other entrepreneurs and business men and women here at the firm: How do you make a better investor and a better entrepreneur [is our goal]?

We feel it's our duty to teach our clients exactly what financial management is.

If it has a dollar sign, we want our advisors attached to it.

Please talk about the sudden wealth syndrome and its implications.

A lot of these individuals come from places where they're the only ones who have made it. That leads to a survivor's guilt mentality.

If that guilt isn't properly managed, you'll see them spending money in crazy, wild ways. It's because they don't know how to handle the sudden wealth they've received.

UBS's white paper, released in June, "Family Ties – How Athletes and Entertainers Navigate Financial Expectations of Family and Friends," recommends defining parameters as to who and how much money an athlete or entertainer will give or loan family members or friends.

But suppose something happens suddenly and, say, a parent urgently needs money that's not within the set parameter. What does the client do?

It's hard to tell no to a mother or father. Emergencies happen. But if things start falling out of the parameters of what we've established and we keep overstepping those boundaries, what's the sense of having a plan?

At the end of the day, we can't let everyone's lack of planning become our emergency.

That's another big thing that happens within the space: People's lack of planning becomes the breadwinner's emergency.

So we plan for rainy days. We want to stick with a plan so that at the end of the day, our athletes and entertainers have the capital that can help build their legacy.

What's critical for the client to remember?

When you do a financial plan, take care of yourself first. Until you're able to get established and secure in your finances, you shouldn't even think about helping somebody else.

The white paper also states that "Athletes and entertainers who are financially successful … focus on financial self-care and share their wealth in an intentional manner that does not hurt their own financial health." Please explain.

We want to make this [concept] real simple. Financial self-care is putting your assets and your planning in three buckets.

So we have the three L's: liquidity — the money you need today; longevity — the money you'll need in a few years; and legacy.

That way, you're setting yourself up for self-care. It gives you the ability to reach out [to give to or make loans] to your family and members of your community or [donate to] a philanthropic endeavor that's dear to your heart.

With the health of the U.S. economy in jeopardy and deep uncertainty in the stock market, are your advisors doing anything different in particular to help athletes and entertainers protect their assets?

If you're reactionary to bad markets, I don't think you're doing your clients a service. There should be a plan in place for the future, not a reactionary position.

There should be a plan for the next two to three years, and the next five to seven and then for retirement.

Good financial planning includes knowing the cycles, so you can predict that there are going to be some tough times.

When troubled times come, our clients, hopefully, have a sense of steadiness that we're going to get through them because we've planned for rainy days.

Do the advisors in your segment prospect for athletes and entertainers?

We don't look at our clients who are in this space as celebrities per se. We look at them as business men and women.

The majority of our advisors' books are [comprised of] hard-working entrepreneurs that have succeeded.

With athletes and entertainers, it's the same: hardworking creative individuals that have taken their craft and talent and have made it.

Have you ever been a financial advisor yourself?

No, but I got my licenses for my own personal education because I wanted to make sure I knew exactly what the advisors were saying. More importantly, if I'm speaking to anyone [else] within our industry, I have the credentials to back up what I'm talking about.

Any yen to be an FA at this point?

Personally, I don't want to be a financial advisor. I think the role I have is the sweet spot for me.

What's essential to helping an athlete or entertainer?

As a former professional athlete, I can say that this is the approach we need to take for athletes and entertainers:

It's important that we talk to them about the ecosystems around them and about philanthropic endeavors.
It's important that we talk to them about the psychology of money.
It's important that we upscale our advisors [to specialize in this space].

What was it like for you managing your finances as a pro football player?

When I was coming up, there were mom-and-pop advisors recommended by friends or agents who really didn't have the bandwidth or experience to work with athletes.

A lot of that got me into deep waters personally. Luckily, I was able to get out of it pretty unscathed. But a lot of my colleagues who were dealing with unsavory characters wound up going bankrupt.

To what extent were you in "deep waters"?

Overleveraging myself sometimes in real estate, investing in companies that had no business being brought to my attention.

There were hundreds of get-rich money schemes brought to me because someone had "a great idea."

Why were you so vulnerable?

I didn't have enough support from my advisors because they were looking at me to get rich and help them with their brand recognition.

Who were your advisors?

A whole slew of people. They could be the uncle that bought me my first pair of cleats — the one who I felt had his stuff together.

Or the teammate that had the nice Lamborghini. And I felt, wow, he has a Lamborghini, so he must be really good with his money. He became a pseudo-advisor.

Or they could be financial advisors themselves.

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