Report: Federal prosecutors investigating Miami booster John Ruiz, Life Wallet

For nearly two years, Miami businessman John Ruiz was the most visible actor in the NIL space. The owner of LifeWallet and Cigarette Racing stated in November he distributed more than $10 million in NIL deals in Year 1 of NIL with plans for expansion.

Shortly after former Kansas State guard Nijel Pack committed to Miami in April 2022, Ruiz announced that LifeWallet had signed him to a two-year deal worth $800,000 along with a car.

In recent months, however, the NIL activity around Ruiz’s companies has decreased. The number of announcements of new endorsement deals and marketing campaigns has noticeably decreased. LifeWallet filed its 2022 annual report months late earlier this week. The numbers showed the company made $23.4 million last year from its business of recovering inaccurately paid insurance claims, failing to meet its $992 million goal revenue projection.

Ruiz and LifeWallet are the target of investigations by the U.S. Securities and Exchange Commission and the U.S. Attorney’s Office for the Southern District of Florida, according to the Miami Herald. Per the report, SEC investigators are looking into whether LifeWallet represented to investors about its value and other possible securities violations.

Multiple witnesses have also been interviewed about Ruiz and his company by the U.S. Attorney’s Office in Miami, according to the Herald.

In a text message to On3, Ruiz stated the company plans to release a statement later Sunday. “Neither I nor the company are the target of a criminal investigation,” Ruiz said to On3.

Once valued at $32 billion, LifeWallet — formally MSP Recovery — currently trades for 20.28 cents. When the company went public through a SPAC — a special purpose acquisition company — merger last year it was worth more than $10 a share.

According to the Herald, Ruiz and Chief Legal Officer Frank Quesada loaned LifeWallet more than $100 million less than a month after it went public. The company also had to renegotiate with creditors for an extension to pay off its debts, per the report.

Concern over LifeWallet fulfilling current NIL contracts.

John Ruiz has signed NIL agreements with Miami athletes, including quarterback Tyler Van Dyke and safety Kam Kinchens. When the Hurricanes made their run to the Final Four, Ruiz was front and center. The businessman had deals with Pack, plus Jordan Miller, Isaiah Wong and Norchad Omier.

Ruiz was named On3’s NIL Most Impactful Person for 2022 in December. A source who represents a LifeWallet athlete expressed concern Sunday about Ruiz fulfilling current NIL contracts.

He also had NIL deals with women’s basketball players Hanna and Haley Cavinder, a relationship which resulted in the Miami women’s basketball team being placed on probation regarding an impermissible benefit during their recruitment. While the Cavinder twins and Ruiz escaped penalties, Miami women’s basketball coach Katie Meier sat out the first three games of the 2022-23 season, and the program is on a one-year probation.

The NCAA said the Cavinders had an impermissible meal with Ruiz, who it classified as a Miami booster. Ruiz informed On3 of plans to sue the NCAA in March for the booster classification; he has yet to file the lawsuit.

“John continues to be an incredible ally as it relates to name, image and likeness, I don’t know that I always put great stock into the numbers that are out there, whether they come from other places or even here at the University of Miami, so we’ll just kind of continue to move on and make sure that we have the opportunity to help our student-athletes who want to be involved in NIL opportunities and give them a great platform,” Miami athletic director Dan Radakovich told On3 in March.