Lots of money, mystery in international signings

July, 9, 2009
A White Sox official was arrested last summer for bringing cash into the United States in his shoes, and cash has been rifled out of the pockets of Dominican teenagers. The Washington Nationals had to fire their Dominican scouting coordinator in an unseemly scandal, and several other teams have fired employees because of signing-bonus looting.

In 2006, the Nationals gave a kid named Esmailyn Gonzalez $1.4 million, but he turned out to be Carlos David Alvarez Lugo and four years older than he told the club. The Indians paid $575,000 to Jose Ozoria last summer after spending time with the family and examining all his papers; recently, they learned that his name is Wally Bryan and that he's three years older than his documentation showed.

Former San Diego Padres chief executive officer Sandy Alderson is overseeing a wholesale investigation being conducted by Eddie Dominguez of MLB Security into corruption and fraud in the Dominican Republic and all over Latin America. The investigation could lead to the deportation of 70 to 100 minor leaguers.

International signing dollars

2004 $22.3 million
2005 $26.8M
2006 $29.4M
2007 $47.1M
2008 $53.9M
2009 $70.5M
Source: MLB club file

Yet, one week after the international signing period opened July 2, the dollars spent on international signings have more than tripled in a five-year period. MLB commissioner Bud Selig, who did not bargain for any slotting system, now beats on teams to stick to a strict, arbitrary slotting system for American players in the draft. Even so, teams were climbing over one another this past week to tell their fans they're spending big in the Latino market. The Cardinals announced they signed 16-year-old outfielder Wagner Mateo for $3.1 million. The Pirates kept the media advised of their bidding on shortstop Miguel Sano, although questions exist about his name and age.

In 2002, Felix Hernandez signed with the Mariners for $710,000. Only 10 Latin American free agents previously had been signed for higher bonuses, and many of them were Cuban major leaguers. Francisco Rodriguez earned $950,000, Francisco Liriano $900,000 and Ervin Santana $725,000. Within the first week after July 2 this year, 18 players have been signed for $700,000 or more. That list will expand significantly before the end of 2009.

Yet five teams who scouted Mateo said that if he were in the U.S. draft, he would be a third-rounder. "His workouts were incredible, but we never saw him get a hit in games," one American League executive said. Still, Mateo and 16-year-old catcher Gary Sanchez, who just earned $3 million from the Yankees, each received more than the suggested slot price for the fifth pick in this year's draft, Baltimore Orioles pitcher Matt Hobgood. And wouldn't you be surprised if agent Scott Boras were to take No. 1 draft pick Stephen Strasburg to Japan, then bring him back next year as a free agent subject to the same market bidding as 21-year-old Cuban left-hander Aroldis Chapman?

"Chapman has a great arm, but no one's seen him as a fifth-day starter," one AL GM said. "He could be great, then again … who knows? Strasburg we've seen. [Jose] Iglesias we've all seen."

And before coming back around to Mets GM Omar Minaya's contention that "the buscones [agents] are training kids to run the 60-yard dash and do workouts instead of playing games," consider this reality: Of the 66 players originally named to Tuesday's All-Star Game, only two -- Hanley Ramirez and Hernandez -- are Latinos age 26 or younger. That is disturbing.

By organization (2009)

Padres $5.8 million
Athletics $5.0M
Yankees $4.8M
Mariners $4.6M
White Sox $4.1M
Reds $3.8M
Rangers $3.5M
Giants $3.4M
Red Sox $3.4M
Pirates $2.9M
Source: MLB club file

"The slotting system doesn't work because teams like the Yankees, Tigers and Red Sox don't care what the commissioner tells them," one general manager said. "So the teams that are poorer or beholden to Bud Selig can't draft the players they want. Look at what happened to the Pirates all those years. But now what is happening is that because of the job Selig and MLB has done with revenue sharing, there is a lot of money out there. So rather than fight with Selig, they're throwing it around at 16-year-olds in the Dominican."

The Orioles, for instance, selected Hobgood because he would sign a contract according to the salary slotting recommendations set by the commissioner's office. The Reds, with the seventh pick in the draft, and the Braves, at No. 8, passed on North Carolina pitcher Alex White because he wouldn't sign for the figure set by the commissioner's office. But the Orioles may go for Sano for more than $3.5 million; meanwhile, Hobgood earned $2.4 million. Go figure.

Baseball America's Jim Callis wrote Wednesday that of the 11 first-round picks who have signed, only one (Houston shortstop Jiovanni Mier, the 21st overall pick) has signed above slotting recommendations, and Mier is only $26,000 above Selig's edict. All the picks above him who have signed have agreed to subslot money.

By country (2009)

Dominican Republic $35.8M
Venezuela $18.9M
Cuba $4.0M
South Korea $3.6M
Japan $1.8M
Source: MLB club file

One small-market Central Division team that hasn't done very well for years has essentially completed a deal with its fourth-round pick, who isn't a college junior and thus has bargaining leverage. But the commissioner's office doesn't like that the agreed-upon number is above slot and has refused to sign off, so the player hasn't gotten out there and is being kept from what the team decided is his market value.

On another front, now that the NCAA has limited baseball scholarships to 10½ for 30 players, it has essentially eliminated full scholarships and the opportunity for poor kids to play college baseball. Now MLB is trying to limit bonuses, which will in turn drive athletes to football and other sports in which they can get scholarships. Boras has long railed against the combined efforts of the NCAA and MLB to drive American athletes away from baseball.

Once the Red Sox sign Iglesias and someone gives Chapman a huge bonus, teams probably will have spent more than $100 million in international signings -- compared to $22.3 million in 2004 -- with no assurance that some of those players will be in the U.S. by the spring of 2010. With Alderson overseeing the diligent work of Dominguez and investigators George Hanna and Dan Mullin from MLB Security, they hope that all the years of benign neglect, corruption and fraud that have cost clubs millions of dollars will be sorted out.

Top international signings (2009)

Wagner Mateo, OF (Cardinals) $3.1M
Gary Sanchez, C (Yankees) $3.0M
Guillermo Pimentel, OF (Mariners) $2.0M
Jose Vinicio, SS (Red Sox) $2.0M
Jurickson Profar, RHP (Rangers) $1.55M
Cheslor Cuthbert, 3B (Royals) $1.5M
Humberto Valor, SS (Reds) $1.5M
Source: MLB club file

They can work on a system that allows anyone to buy birth certificates and hospital records on the open market. But they cannot fix the distorted buscones system.

"It is amazing to see these kids in a tryout setting -- they can tune up a BP fastball and run the 60 but lack instincts and most basic fundamentals," one international scouting director said. "When we put them in games, their lack of game-playing skills stick out -- they can't slide, don't recognize situations. But buscones continue to emphasize power, arm strength and speed -- nothing else. What's more, they're taken out of school at 10 years old, and their abilities to retain information are severely hindered. We try to get these kids to learn English, yet their Spanish isn't very good."

Contrast that to Pedro Martinez, whose mother forced him to be educated, and brother Ramon insisted he learn English. Martinez went to the U.S., is fluent and can tell anecdotes in two languages, and is one of the most intelligent people and pitchers of the past 25 years.

"We're signing teenage kids based on tools, nothing else," one general manager said. "The gamble is huge. Projections based simply on the 60-yard dash and batting practice is dangerous."

In 2006, Boston gave outfielder Engel Beltre $600,000. When everyone's favorite guide -- the Baseball America "Prospect Handbook" -- came out in 2007, Beltre was compared to Barry Bonds. The Red Sox traded Beltre to Texas, and he's hitting .217 with a .568 OPS in Class A ball. But his tools are still great.

"We signed three kids who had full documentation that they were 16," one NL GM said. "They all turned out to be 19, and their tools didn't translate as well at that age."

The Mets' biggest international bonuses in the past three years have gone to the sons of Tony Pena and Ugueth Urbina. "We know their families and can go back to media guides and see when they were born," Minaya said.

"Look," Brewers GM Doug Melvin said, "there are players out there, but now you've got 30 teams with 30 Dominican players apiece -- 900 players from a tiny area. Then you have the buscones, and it's crazy."

Top all-time international signings

Rolando Arrojo, RHP (Devil Rays) $7.0M
Jose Contreras, RHP (Yankees) $6.0M
Danys Baez, RHP (Indians) $4.5M
Michael Ynoa, RHP (Athletics) $4.25M
Dayan Viciedo, 3B (White Sox) $4.0M
Source: MLB club file

Melvin suggests that one way to get back to Dominican baseball and away from the buscones tryout system is to turn the Dominican Summer League over to MLB to look at the amateurs. Every young player would be required to register with MLB, which would run the league. "Then, when they turn 16, we have a draft," Melvin said. "That way we'd get to scout them as players, not workout warriors. That way baseball, not the buscones, would have control of the process."

Whether it could be done in Venezuela without president Hugo Chavez's cooperation remains to be seen. Dominguez, who was born in Cuba, has told the commissioner's office that MLB had better be prepared for the opening of that country to the U.S., possibly by the end of this year. We have seen that the cultural assimilation in going from Cuban society to the United States has proved difficult for many individuals, and the records may be as questionable as those in the Dominican Republic.

Speaking from experience, when I was in Cuba for 10 days in 1999, I bought a pack of Cuban baseball cards printed in Canada in 1994. The birth dates of most of the players who came to this county like Rolando Arrojo, Andy Morales et al. had far different birth dates on those cards from what MLB teams were told. (The birth dates of Livan and Orlando "El Duque" Hernandez corresponded, and I met Kendry Morales before he turned 16, and his age is legitimate.) So Chapman may well be 26, not 21.

"It's time for people who have run teams and understand the system to overhaul the draft and signing systems," one GM said. "The commissioner's office doesn't get it. The system now rewards the Yankees, Red Sox, Tigers and teams like that, who can ignore Selig and still spend big in the international market. [Detroit has snubbed its nose at Selig's slots but has not been a major player internationally.] Any GM whose owner will take Selig's call is very fortunate."

Alderson and a committee of general managers should propose a system that would cap total spending for amateur and international signings. They need to allow bad teams to get the best players. They ought to allow teams to decide whether they want to spend in the draft or internationally. And they should emphasize that when MLB executive vice president Rob Manfred and soon-to-be MLB Players Association head Michael Weiner -- who are wise, rational men and work well together -- sit down to negotiate a cap and slotting system, that this would leave more dollars for major league players covered by the MLBPA.


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