Return of the bag man: NIL clearinghouse could revive paying college athletes under table

A few weeks ago, as the House settlement was dragging its feet through the final approval process, I was chatting with a power conference athletic director about whether it would actually work as intended.

Athletic departments throughout the country have been gearing up for the $20.5 million in annual revenue sharing, which is the most notable piece of the $2.8 billion agreement. But among coaches and administrators, there is particular interest in the settlement’s newly created enforcement arm intended to stamp out the pay-for-play deals that have dominated the name, image and likeness era of college sports.

It’s a critical piece of the settlement for the NCAA and power conferences, considering the NCAA’s inability to enforce its own NIL rules, yet there remains a deep skepticism among many in the industry that this new enforcement will be any more effective.

One reason? A familiar character in college sports could return to the forefront: the bag man.

The new enforcement terms under the House settlement instruct college athletes to declare any third-party NIL deals worth at least $600 into a clearinghouse database. The idea is that the clearinghouse, dubbed “NIL Go” and managed by the accounting firm Deloitte, will serve as a restrictor plate on NIL collectives and pay-for-play, flagging deals that do not reflect a valid business purpose or fall within a reasonable range of compensation. Yahoo Sports reported that at the recent ACC spring meetings, Deloitte officials shared that 70 percent of past deals from NIL collectives would be denied under the new clearinghouse.

But in candid conversations, coaches and recruiting staffers have serious doubts that athletes will declare those deals, or do so accurately. Some have suggested that players are being encouraged not to declare deals at all, but to simply take the money and keep quiet rather than risk the clearinghouse flagging it. And if that’s the case, where do we suspect that money might be coming from?

“I guess it would just be the same as the way things used to work,” lamented the athletic director, frustrated by those already angling to undermine the settlement. “We’d be right back where we started.”

Before NIL, “bag men” were the not-so-invisible hands of big-time college sports, boosters who secretly funneled cash to top players and recruits. It was cheating in the same way that driving over the speed limit is a crime: If it wasn’t flagrant or egregious, you probably weren’t getting caught.

“Though of course not every player at every level is paid for, this is the arrangement in high-stakes college football,” is how writer Steven Godfrey described it in his 2014 deep dive into the clandestine world of bag men. “Providing cash and benefits to players is not a scandal or a scheme, merely a function. And when you start listening to the stories, you understand the function can never be stopped.”

It’s true. The bag man didn’t disappear in the NIL era — he was legitimized. The emergence of NIL collectives expanded the pool of bag men (and bag women!) by allowing boosters and even everyday fans to fund their favorite team’s roster without fear of ignominy or recruiting violations. It was a modern-day Frank Abagnale story, the bag man coming out of the shadows, from delinquent to deputy.

Without guardrails or the threat of punishment, NIL spending mushroomed. Ohio State football won a national championship last season with a $20 million roster. Top players in football and basketball command seven-figure payments. And as the House settlement loomed, the richest collectives front-loaded their deals in recent months to pre-empt the clearinghouse, which is how you have reports of Texas football spending as much as $40 million on its 2025 roster, including forthcoming revenue sharing.

The settlement is designed to rein in that Wild West culture of NIL, with annual caps on revenue share and constraints on third-party NIL meant to instill some competitive balance. In theory. But $20.5 million won’t be enough for the schools at the top of the power conferences, especially when those funds are spread across an entire athletic department. We’ve already had $20 million rosters in football and $10 million in men’s basketball, and some in the industry believe $40 million-$50 million football rosters are inevitable.

The oversight and enforcement arm, named the College Sports Commission, is supposed to combat that, armed with more efficiency and punitive power than the NCAA currently wields. But history suggests that power-thirsty boosters paying athletes under the table is a tough thing to police — particularly after collectives spent the past few years streamlining the art of bag dropping.

Now, instead of an envelope of cash in a player’s locker, it’s a direct deposit into their bank account. (The IRS might complicate that process under the House settlement, but that’s what payment apps are for.)

“If some donor wants to wire a player $25,000 a month, who’s keeping track of that?” one power conference administrator said.

Money wires aside, the system of boosters paying players is much more sophisticated and far less frowned upon, and it’s going to be impossible to put that infrastructure back into the tube.

One of the main objectives of the House settlement for the NCAA and power conference defendants was to neutralize NIL collectives. But those collectives aren’t going away. Several states have NIL laws that contradict the settlement and could provide legal workarounds. And if not, collectives can just go back into the shadows, out of sight but still pulling the strings.

Maybe the enforcement piece of the settlement will work, or at least be a more effective deterrent than previously existed. Maybe the scrutiny and punishments will be unpleasant enough to curb bag dropping or strike fear in coaches beyond their plausible deniability. Maybe the clearinghouse, over time, will force collectives to wither and players to sign legitimate NIL deals that pass muster.

But for as long as college sports have existed, there have always been folks looking for an edge, a way to beat the system. And the best ones have always found it.

“Maybe you’re trying to do it the right way, but there are always going to be those schools and actors that are trying to do something else,” another power conference administrator said.

The House settlement is going to change the future of college sports. It might revive a bit of its past, too.

 (Photo: Sam Hodde / Getty Images)