The feel-good story that led to a scam

The State of Illinois, in an attempt to raise a few extra dollars in revenue, allows vehicle owners to show their allegiance to a college or university. For a small fee (of which I’m sure each school gets a cut), motorists can go beyond just having a window sticker, or a license plate frame, and take the full-on plunge of using their license plates to declare school loyalty. There are eighteen colleges and universities available for Illinois schools, and the only non-Illinois school available is Notre Dame.

I understand why Notre Dame participates in this program. The sale of merchandise with their logo and name on it must be worth a fortune to the school. I want to believe they use this money for more than just their athletic program/football team, but what they do with the money isn’t really my concern.

A few months ago, I was driving in the streets of my neighborhood when I spotted an SUV with these  Notre Dame plates on it. They also had the window sticker, and the license plate frame, and whoever owned the car was either an ND alum, or a really big fan. Notre Dame seems to have those “subway alums” in a way that no other school does. Maybe it’s the Irish thing, or a loyalty to Catholicism, or some combination of the two, but it’s definitely real.

The Notre Dame plates that I saw on the SUV had the letters “RUDY” on it, no doubt in reference to the movie about the life story of Daniel “Rudy” Reuttiger. The movie was a Hollywood underdog story about a little guy who followed his dream until it came true. One of those feel-good stories that plays on our deeply-rooted belief that anything can happen if you want it badly enough. And, as a bonus for some, it’s set against the backdrop of Notre Dame football.

I was able to snap a picture of the RUDY plates with my Blackberry before the SUV drove away, but the image is buried inside a phone that doesn’t work anymore, and it will never see the light of day again. Trust me when I tell you that such a license plate really does exist.

Getting back to the story of “Rudy,” the story ended on the screen, but the real-life “Rudy” had to keep on living. He presumably made some money on the movie rights to his story, and cashing in is certainly the American Way. But “Rudy” wanted more. He was willing to trade on the notoriety that the movie brought him, in order to find an even bigger payday. Again, there’s something uniquely American in parlaying one good thing into something else that’s even bigger.

And so “Rudy” founded Rudy Nutrition. Perhaps if you drank “Rudy’s” drink, you, too, could achieve results. That’s how the thinking went, anyway. “Rudy” made claims that the drink “Outsold Gatorade 2 to 1” and tried to lure investors into buying stock in his company. But this was all a scam, and anyone who bought stock in Rudy’s company found this out the hard way. The Securities and Exchange Commission (SEC) shut Rudy Nutrition down, but not until $11 million dollars had been swindled from unwary investors. “Rudy” himself paid nearly $400,000 to make the claim go away, although none of that money will go to those suckers (technically they’re called “investors”) who believed that Rudy Nutrition was for real.

The University itself did not get involved with Rudy Nutrition, so there’s no harm done to their name in all this. The feel-good story that Hollywood put up on the screen will continue to endure, as well. But the “Rudy” story has been tarnished by the fraud and deception of the person behind it. I hope that whatever amount of money he made (less whatever amount he had to pay to his lawyers and to the SEC) was worth it, for the shame and humiliation that he brought upon himself and his family.

I wonder if the RUDY license plates will remain on the SUV I saw on the streets of Chicago. I have a feeling that they will, for no other reason than that the fees have already changed hands, and the State of Illinois (and Notre Dame itself) aren’t going to be offering any refunds.

The story itself will make headlines for a day or two, and will then fade away. Life goes on, and Rudy (the movie) will be streaming on Netflix forever more. This is the only real chance to make any comment on the story, before it fades away into the category of “old news.” That’s what the 24-hour news cycle has done to us as a people.

The notion that government is “meddlesome” in the free market has taken root in the mind of the general public over the past few decades. Government regulation is a burden, the thinking goes, and by eliminating government oversight, the free market will flourish. But the perpetrators behind Rudy Nutrition needed to be reined in somehow. And if it took a government agency to put a stop to this scam, then the answer must not be less government oversight.

If anything positive comes out of this story, in my mind, it’s that the government has affirmed its role in bringing these sorts of fraudulent activities to light. It’s cold comfort to anyone who lost money on Rudy Nutrition’s stock, but it’s worth noting just the same.