Cracking Down on the Payoffs

To be eligible for participation in the Olympic Games, a competitor must not have received any financial rewards or material benefit in connection with his or her sports participation.

--International Olympic Committee Eligibility Code

"Even amateurs have to eat. " --U.S. track star

For years, the gap between rhetoric and reality in international amateur athletics has bred hypocrisy and, periodically, scandal. While demanding lip service to an impracticable ideal, the amateur system has left American athletes to fend for themselves in a degrading world of under-the-table payoffs and over-the-table handouts. To support themselves during the rigors of year-round training, many Olympians have accepted deals from manufacturers and fees for appearing in track and field meets, hiding their earnings from Olympic, Amateur Athletic Union and international sports federation officials. In the process, many have concealed their incomes from the Internal Revenue Service as well. Now TIME has learned that the IRS has launched a broad investigation of amateur athletes, seeking payment of taxes on such concealed income. The Government has started at the top. Dwight Stones, the tall-talking, tall-leaping world-record holder in the high jump, has been under scrutiny by the IRS for several months.

Incentive Payments. Records covering Stones' onetime association with the Pacific Coast Club--which has a roster that is a virtual roll call of American Olympians--have been subpoenaed. Stones denies any wrongdoing. Says he: "They're just after me because I've been in the papers more than anybody else." Still, the investigation is expected to spread to other prominent amateur athletes during the coming months, raising fears that the reputations--and perhaps the Olympic eligibility--of most world-class American track and field stars could be destroyed.

That money often changes hands --and that the need for such an exchange exists in a country that has not subsidized the training of athletes after their school years--is an open and conveniently ignored secret. With 20,000 spectators looking on, an American runner stood on the victory stand after a track meet in Europe and received a medal and an envelope. The envelope contained a cash "appearance fee"--remuneration for showing up to compete in the event--and the provider was a member of the host country's amateur federation. An American track-meet promoter, anxious to lure a top dash man to his indoor meet to increase the gate, called a speedster and promised him $800 plus expenses for joining the field. But two meets were scheduled on the opposite coast for the same weekend, and the sprinter had been offered round-trip plane tickets by both meet directors--one of which he could cash in as an informal subsidy. So the promoter decided that to clinch the deal it was necessary to tack on a sliding scale of incentive payments for any records the runner might set.

World-class milers, the heroes of track's glamour event, have for years been among the best-paid amateurs. Few have pulled on their running shoes for less than $1,000. Pole vaulters have been paid bonuses of $100 for every inch they soar over 17 ft. 6 in., a height easily within the range of top performers; the world record is 18 ft. 8 1/4 in., and the vaulters can pick up a tidy sum before the going gets serious. One former Olympic medalist once hinted to a shoe manufacturer that he wanted a new car. A few days later he was given the cash to pay for it. At the U.S. Olympic trials last summer, some track and field stars first ran their qualifying heats, then dashed into the stands to dicker with representatives of warring jock-shoe companies. While the athletes and the shoe companies settled on prices for putting brand names into the starting blocks at Montreal, U.S. Olympic officials played with their stop watches.

For some athletes, payoffs are the primary means of supporting themselves. Says one former Olympian: "Worldclass athletes would not be world-class athletes without taking money. They would never be able to afford the proper training and diet." Unlike Communist countries and many Third World nations--where athletes are virtual wards of the state--American and Western European track and field stars receive no direct support beyond their college years. Says Ted Haydon, University of Chicago Track Club coach: "U.S. athletes are pretty much destitute, dependent on handouts from track-shoe companies. They think it's a great thing to get a pair of shoes or a sweatsuit. They're penniless for the most part, and nobody cares. Living in this condition makes them vulnerable to promoters who want to hype up their meets with big names. It's the fault of the system." In the same way, the payoffs finance the Olympic programs of most Western nations.

Cash and Carry. Some athletes, fearful that IRS records could be used to revoke their eligibility, play a dangerous game of concealment from Government, as well as amateur, officials. As one former Olympian explains, "If it's all done in cash, who's going to trace it? I never used to deposit the money in a checking account. I always put it in safe-deposit boxes because of the IRS. I always paid cash for everything." Another athlete admits that he did not file tax returns on his track earnings. Says he: "I felt the AAU would find out that I was paying income tax on money I shouldn't have had in the first place and would try to nail me. I didn't know how to pay taxes without jeopardizing my track career."

The investigation against Stones has the amateurs sprinting to tax lawyers. From them, some of the athletes have discovered for the first time that IRS records are confidential and not available to rival promoters or amateur officials. Says one track man, now suddenly wiser: "The IRS doesn't care about amateurism; they just want their cut. I'm going to file from now on." Haydon agrees. "It's not a good idea to hide money from the IRS," he says. "The underworld figured that out a long time ago."

Al Franken, a promoter who stages two of the indoor season's largest California meets, admits that appearance fees are paid, often in a lump sum to managers of track clubs, who then distribute the cash among members. Asks Franken: "What's wrong with getting paid for doing something well?"

The quiet under-the-table symbiosis of promoter and athlete may be shattered for good by the IRS investigation, and out of it all could come pressure for reform--perhaps in the shape of open pro-am competition in track and field. But some athletes fear change will come too late for those already tainted by a corrupt system. Discus Thrower John Powell, for one, is worried that the IRS will put pressure on Stones to tell all he knows about other athletes. Says Powell: "Stones could turn out to be the John Dean of amateur track." Others cynically predict that AAU reprisals will be selective and merely cosmetic--barring a few scapegoat athletes from competition while resisting fundamental change in the conditions that gave rise to the scandal.

Still, Marathon Medalist Frank Shorter feels the long-range effect could be beneficial to U.S. athletics. Says he: "This is a shocker. It's time everyone woke up. We should do track the way it's done in tennis, where anyone can be a professional if he wants to, but amateurs and professionals can compete against each other. Maybe if Dwight's case gets enough attention, the IRS will do all of us a favor in the end."

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