June 12, 2012
By: John Clark
After filing for bankruptcy in April, former NFL star Jamal Lewis faces his first important hearing this week in a Georgia bankruptcy court, according to a report from the Baltimore Sun.
Lewis, who starred for several years as a running back with several teams, told the bankruptcy court in his petition that he holds $14.5 million in assets, but owes $10.6 million in debt to several creditors.
Ironically, Lewis owes $350,000 for a loan on which he defaulted to M&T Bank, which holds the naming rights to the stadium occupied by the Baltimore Ravens, one of the running back’s former teams.
In this week’s hearing, the bankruptcy court will start to determine Lewis’s future financial fate, although Lewis and his bankruptcy attorney have refused to discuss his case with local reporters, so few details have been released.
The nature of the former athlete’s financial demise, however, is public knowledge. Sources say that Lewis has failed to repay loans intended for a variety of business ventures, including a failed real estate company and a trucking company that recently had to close its doors.
Unfortunately, Lewis has followed an all-too-common path taken by professional athletes, who often make millions during their career but end up in bankruptcy court shortly after they retire.
And football players, with their short career spans and non-guaranteed contracts, seem to have it worse than most athletes. According to a recent article by Sports Illustrated, almost 80 percent of professional football players have financial problems within two years of their retirement.
These troubles are often due to poor investment decisions, costly divorces, and child support obligations. Overspending is also a common financial issue for young professional athletes.
According to Annamaria Lusardi, a business school professor at George Washington University, young athletes often have “little expertise in financial matters” and receive “very little financial guidance,” which can be a recipe for financial disaster.
To address this issue, professional sports leagues, including the NFL, have taken more active measures to educate their players on the dangers of overspending.
But such classes came too late for players like Lewis, who joined a long list of retired NFL players seeking bankruptcy help.
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