Fedorov's financial disaster

by James Mirtle on Jul 23, 2009 7:01 PM CDT Comment 11 comments

I'm not sure I could put my finger on what exactly made me think it, but it's seemed to me that Sergei Fedorov has had something amiss with his financial situation for a while now. Even just looking at last summer's negotiations with the Capitals, when he was also in talks with the KHL, it appeared he and his agent pressed for every last dollar, eventually getting a generous $4-million one-year deal that put the Capitals very snug against the salary cap.

A year later, Fedorov did finally follow the money to the KHL (reportedly $3.8-million tax free in each of the next two seasons) and we're now hearing just how bleak his finances are.

Of the $65-million or so made over his NHL career, Fedorov has apparently lost $43-million to "a Grosse Pointe Shores man entrusted to manage his money." Given the amounts involved — about two-thirds of his lifetime earnings — and some of the language in an agreement he made with this Joseph Zada (see snippet below), it seems Fedorov could be in some tax trouble down the line as well:

Fedorov_medium

I talked to one source in the industry about this case and they said that after taxes and agent's fees, Fedorov really should have only had something like $35-million at his disposal, making it appear something fishy is going on if Zada indeed had control of this much of his cash.

"These stories are far too common," he added, pointing to financial issues and lawsuits involving Jaromir Jagr and Patrik Elias.

It also seems apparent that Fedorov had wanted to keep this situation quiet, and I wouldn't be surprised if the only reason the suit was filed now is that he's over in Russia, well away from the North American press. It's a sad story, really, especially when you consider the incredible start he had to his career.

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Federov

Man, that is too bad. It amazes me how often the great ones get caught up in the financials. Really too bad. Wish him the best.

by Mulator on Jul 23, 2009 7:40 PM CDT reply actions 0 recs

Poor guy

I remember reading Tiger Williams bio years ago and how he got major crap from management in Swift Current for not signing with one particular agent who put the screws to a ton of guys as it turned out years later.

by Exit716 on Jul 23, 2009 9:15 PM CDT reply actions 0 recs

but kournikova... no?

by royalsreview on Jul 23, 2009 9:22 PM CDT reply actions 0 recs

I think most of that $43m was from he and Fedor’s music career.

Hockey blogging can't get any flatter.

by saskhab on Jul 24, 2009 12:01 AM CDT reply actions 0 recs

The list of athletes who lose all their money to financial people is astonishing. There’s Kareem Abdul-Jabbar, for one. Most of the West Indies cricket team got scammed by Allen Stanford. The NBA instituted a mandatory program of financial education for all rookies. I have no idea how much good it does, but it sure as hell can’t hurt.

by J. Michael Neal on Jul 24, 2009 12:36 AM CDT reply actions 0 recs

I remember reading about one NBA player (cannot recall his name at all) who was talking about money once. He was talking about the pressure that a player is under to help out his family – not just long-lost relatives that come out of the woodwork, but the parents, grandparents, brothers, and sisters that helped so much when he was growing up. The only way he avoided being overwhelmed by the demands was to give each of his relatives some sum of money when he got his first big contract, and tell them that was all they were going to get because he wasn’t going to be constantly helping them and supporting them and bailing them out since his income wasn’t going to last forever and he had to take care of his own wife and children first.

The interview really struck me because you could see from his expression that he was recalling some very hurt feelings, but other people had just seen the big numbers and didn’t think about how short a career in professional sports was going to be and how the man would need to bank as much as he could for himself and his kids, and as much as he wanted to give money back to his family members it would be a great way to wind up broke.

I don’t know if he went through the program or if he was just financially astute, but either way it was not an easy decision and I was impressed that he was able to make it.

"Be kind, for everyone you meet is fighting a great battle." -- Philo of Alexandria

by Baroque on Jul 24, 2009 5:07 AM CDT up reply actions 0 recs

Didn’t Peca and Berard recently get taken in a scam too? The NHLPA should take steps to protect these guys from white collar criminals. Far too many athletes seem to fall victim to such crimes.

by puckreport on Jul 24, 2009 1:25 AM CDT reply actions 0 recs

Mike Modano lost a lot of money pretty recently, too.

The tough thing about scams is that you can tell people (not just athletes) all the time about scams to avoid, and yet people still fall for the “Nigerian rich guy” scam and many others. I don’t think athletes are necessarily any more gullible than any other person of a comparable age and experience (most stereotypical “dumb jocks” that I recall from high school either smartened up or remained so dumb that they couldn’t handle keeping coverage schemes or pitching tendencies in their peabrains and would not make good professional athletes anyway), but because they have so much more money at their disposal and it is so well-known that they have a lot of money that they are more visible as targets and can lose a lot more money in one scam.

"Be kind, for everyone you meet is fighting a great battle." -- Philo of Alexandria

by Baroque on Jul 24, 2009 5:16 AM CDT up reply actions 0 recs

You’re right, I’d forgotten about Modano. He apparently lost millions to an “advisor” of this sort a few years ago.

Blogging on hockey at fromtherink.com

by James Mirtle on Jul 24, 2009 11:39 AM CDT up reply actions 0 recs

Yeah – Peca, Berard, Gonchar, deVries, Norstrom, Stumpel, Sydor, etc. lost about $300k each with an “advisor” who blew the money on… well, check out the article titled “Our Cash Was Blown on MLB Porn Party” at www.tmz.com/2009/06/18/nhl-mlb-hockey-baseball-lawsuit-roger-clemens

by edtor on Jul 24, 2009 10:23 AM CDT up reply actions 0 recs

The other story I remember this year: “Rangers GM Sather Posts US$1 Million Bail For Pocklington” – Peter Pocklington owes $20 million / has assets of $2,900. (www.tsn.ca/nhl/story/?id=271098)

by edtor on Jul 24, 2009 10:27 AM CDT reply actions 0 recs

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