NC State

Youth leagues, coaching visits, a helicopter. How Dennis Smith Jr. landed at NC State.

The recruitment of Dennis Smith Jr. from Fayetteville to N.C. State involved years of coaching visits, a helicopter and, according to federal investigators, a $40,000 payment to ensure that he’d remain committed to the Wolfpack and, perhaps, to the idea of signing an endorsement deal with adidas.

Smith, who played one season at N.C. State before entering the NBA draft, is not named in the U.S. Department of Justice’s most recent indictment in a college basketball corruption case. Yet the details in that indictment make clear that an allegation involving N.C. State is related to Smith’s recruitment.

Smith isn’t accused of a crime. Neither is any member of his family. Yet his association with an ever-growing corruption case further illuminates the sketchiness of college basketball recruiting, and it raises questions about how, exactly, one of the nation’s most talented players wound up at N.C. State.

Smith's journey, in which he went from middle school phenom to an NBA rookie who has found himself associated with a federal investigation, began, it seems, innocently enough.

On his first nationally-competitive AAU team Smith and his teammates received lessons, aside from basketball, in civil rights history and social awareness. And yet the same path that brought those lessons led, in time, to college basketball's black market, according to the FBI.

Smith's story speaks to corruption -- a secondary market created by the NCAA's amateurism rules -- that was long assumed in college basketball recruiting, but is now in the spotlight amid the FBI investigation.

Basketball underdogs

When Smith committed to N.C. State in September 2015, he was considered the best point guard in his class in the country. He could have chosen to play in college, essentially, at any school he wanted. He had scholarship offers from North Carolina and Duke, Kansas and Kentucky.

N.C. State, though, had been the first major-conference school to offer him a scholarship. Smith acknowledged that when he committed and, soon, another public narrative emerged to explain his choice: that he’d grown up in a family of Wolfpack fans.

After Smith committed, he said he appreciated N.C. State’s reputation as a basketball underdog, relative to its more successful neighbors at Duke and UNC. At the time, during an interview with The News & Observer, Smith said, “I told coach (Mark) Gottfried, I like being the underdog.”

The FBI investigation, though, raises questions about how much of an underdog N.C. State really was, at least in the context of Smith’s recruitment. According to the indictment, Smith’s services were arguably spoken for, thanks to N.C. State’s relationship with adidas, the school’s apparel provider.

According to the indictment, Jim Gatto, an adidas executive who faces fraud charges, conspired with “others known and unknown” to “illicitly funnel approximately $40,000” from adidas to Smith’s father, who coached a Fayetteville-based, adidas-sponsored AAU team that Smith played on in his later years of high school.

The payment was made, allegedly, sometime after October 2015. It was around then, according to investigators, that an unidentified N.C. State coach informed adidas that Smith “was not happy with his selection of North Carolina State University and was considering de-committing.” From there, authorities allege that Gatto and adidas agreed to give $40,000 to the N.C. State coach, who in turn allegedly delivered the money to Smith’s father.

Attempts to reach Gottfried, who was hired by Cal State-Northridge as its head basketball coach last month, and former N.C. State assistant coach Orlando Early for comment have been unsuccessful.

At a charity appearance in Dallas on Thursday, Smith answered a question about the FBI case, telling a reporter for the Fort Worth Star-Telegram that "allegations are just allegations. There isn't any proof behind anything."

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The allegations, if true, help explain how Smith chose to play at N.C. State. The Wolfpack, after all, hadn’t successfully recruited a prospect of Smith’s caliber since David Thompson, in the 1970s. On the surface, however, N.C. State’s recruiting victory seemed like the fruits of a job well done.

The helicopter

Gottfried, whom N.C. State fired after the Wolfpack’s lone season with Smith imploded, clearly made the point guard his top recruiting priority, beginning during Smith's sophomore year at Trinity Christian School in Fayetteville. Gottfried became a regular at Smith’s summer-league AAU games, for one. And not long before Smith gave word he’d attend N.C. State, in September 2015, Gottfried and Early rode a helicopter to visit Smith at Trinity Christian.

“It’s pretty humbling,” Smith said at the time, according to The Fayetteville Observer.

It was a recruiting gimmick – coaches riding in a helicopter to visit a sought-after prospect – but it was one that worked. Smith informed Gottfried the next day that he’d be bound for N.C. State. Wolfpack supporters reacted with zestful enthusiasm. At the time, Smith’s commitment seemed to be something of a turning point for Gottfried’s program.

Indeed, Gottfried didn’t temper expectations before what turned out to be Smith’s lone season. Gottfried then described Smith as “the best guard in the country. Period. Hands down.” Evan Daniels, a national college basketball recruiting analyst for, said at the time that Smith was a "game-changer." He was considered one of the best guard prospects in the nation.

By then, Smith was no stranger to life as a prized commodity. Some of the most prominent college basketball coaches in the country – and, undoubtedly, some of the most well-connected shoe company employees, too – had known about Smith since before he ever played a high school game.

AAU basketball

The summer before his freshman year of high school, Smith played a leading role for the Karolina Diamonds, a Greensboro-based AAU team coached by Kevin Graves. The team finished second in its age group in the AAU nationals in Orlando, and college coaches who attended, Graves said at the time, included Kentucky’s John Calipari, Kansas’ Bill Self and former Louisville coach Rick Pitino.

Dennis Smith Jr., center, greets N.C. State assistant coach Orlando Early, left, and coach Mark Gottfried after they arrived by helicopter at Trinity Christian School on Wednesday, Sept. 9, 2015. Cindy Burnham The Fayetteville Observer

In some ways, Graves’ team – which also included Edrice “Bam” Adebayo, who went on to play for Kentucky before entering the NBA after one season, and North Carolina guard Seventh Woods – helped introduce Smith on the national stage. Before playing for Graves, Smith had played on the statewide AAU circuit with a team his father coached in Fayetteville.

“I was like, dude, I would love to pick him up and take him to the national circuit,” Graves said earlier this week, recalling a conversation he had with Smith’s father before the younger Smith joined the Diamonds.

Smith played for Graves for three summers, beginning with the summer after seventh grade. Smith’s future seemed clear even then, Graves said, and it appeared obvious to those who watched Smith that he’d become a high-level prospect.

“He had so much ball control and so much savvy,” Graves said. “His instincts in seventh grade were the same as now. I’m serious.”

It didn’t take long for college coaches to begin inquiring about Smith. Graves recalled Smith “drawing interest as an eighth grader from major, major programs.” In those formative years, when Smith was just beginning to build his national reputation, Graves saw himself as something of a protector – not just for Smith, but for all the kids he coached.

Graves had witnessed first-hand what he described as the seediness of the summer basketball circuit. For years, throughout the 2000s, he’d been skeptical of the Greensboro Gaters, which at the time was among the most prominent AAU programs in the country, and one that was backed with sneaker money from Reebok. Gaters alumni include Raymond Felton and Rashad McCants, who helped lead UNC to the 2005 national championship, and Carmelo Anthony, who led Syracuse to the 2003 national championship in his lone college season before embarking on an All-Star NBA career.

Behind the Gaters’ success, Graves suspected manipulation – that people he described as “corrupt white dudes” were “out here trying to entice young black kids” with sneaker money, gear and the promise of success.

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One of the men behind the Gaters’ success, Stan Kowalewski, was a controversial Greensboro-area high school basketball coach. He also ran a Greensboro-based investment management firm that, a federal investigation discovered, stole millions from his clients. In 2015, a jury convicted Kowalewski of 24 felony charges related to the fraud, and he’s serving an 18-year prison sentence. Vic Sapp, another coach who worked with the Gaters organization, was found dead in his garage in 2007.

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The Diamonds, Graves said, were self-funded – both by himself and by the Burlington alumni chapter of the Kappa Alpha Psi fraternity. Graves said he built the program with an emphasis beyond basketball. His players, he said, weren’t allowed to grow their hair long. They learned what Graves described as “proper grooming techniques.” They learned to tie a bow tie in the seventh grade.

Graves said he stressed the importance of academic achievement, and social awareness. After a phone interview ended, he quickly texted an old picture of his team wearing shirts honoring Trayvon Martin. Smith is near the front of the picture, staring intently into the camera.

An 'alternative'

It was in this environment that Smith, then still in middle school, first rose to national basketball prominence. Graves said he limited the outside influence into the Karolina Diamonds – the “K” a reference to his fraternity’s support. The Diamonds, for instance, were not backed by a shoe company.

“Nobody could entice my kids,” Graves said. “I don’t need Nike trying to call me, trying to sauce me up. The stuff that they were offering, I didn’t want it.”

Graves said he built his AAU program with the intention of eradicating the shadiness that hung over the highest level of the summer basketball circuit in North Carolina.

“I wanted to create an alternative that was genuine,” he said. “I wanted to create an alternative that was trustworthy.”

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He believes Smith embodies those characteristics. Smith stopped playing for Graves’ team once he entered the 10th grade. By then he was well on his way, and during the summers he played for his father’s AAU team, which was now competing nationally.

If there was a plot for the younger Smith to attended an adidas school simply because of the connection between his father’s AAU team and the apparel company, Graves doesn’t believe that Smith was a part of it, or even aware of it, if it existed. Aside from the brief comment Thursday, neither Smith nor his father have spoken in detail about the federal indictment that alleges the $40,000 payment to secure his commitment.

Even if they did comment, it would be impossible to know, for sure, how such a payment might have come to fruition. Did Smith, allegedly unhappy with his commitment to N.C. State, ask for money to remain committed? Did his father, sensing an opportunity for a quick pay day? Or did the unnamed N.C. State coach conspire with adidas to offer the money, perhaps as a kind of preemptive move?

The allegation involving N.C. State, and particularly involving Smith, frustrates Graves, who is no longer coaching basketball. That Smith is now connected to a scandal doesn’t sit well with a man who said he tried his best to insulate his players from the usual racket of summer-league high school basketball.

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Even still Graves prides himself on the meticulous way in which he said he ran his program, and the details about things like keeping his players’ hair short. He spoke with pride about how Smith doesn’t have tattoos.

“Nobody notices that part of it,” Graves said. “Everybody wants to talk about the FBI probe. Dennis is a great, great kid. He didn’t do anything wrong. And if anyone did something wrong, they did it without his knowledge.”

Standing room only

In the summer of 2013, Smith played for the final time with Graves’ team. He entered his sophomore year at Trinity Christian still relatively unknown, nationally. College coaches were already familiar, though, and soon enough a lot of other people were, too. In December 2013, the buzz around Smith building, he played in Wilson, in the Greenfield School Christmas tournament, in front of what The Wilson Times described as a “standing-room only crowd.” Smith earned MVP honors there.

Less than a week later Smith played in Raleigh in the Holiday Invitational, one of the nation’s marquee high school basketball tournaments. He scored 42 points in his second game there. Gottfried watched from a seat near the court, and after the game he offered Smith a scholarship.

“A blessing,” Smith told The Fayetteville Observer at the time.

It was, in some ways, his arrival. Kansas offered Smith a scholarship the following spring, and then so did Wake Forest, and Duke, and UNC. Smith, whose humble beginnings in the summer travel basketball circuit began, in part, with bow tie lessons in middle school, now had his pick among some of the best college programs in the country.

Even so, N.C. State appeared to be the leader from the start, perhaps because Gottfried was first to offer a scholarship. In time, so did all three of his rival head coaches at North Carolina's other three ACC schools. Roy Williams, the UNC coach, recently said during a radio interview that he "loved Dennis Smith and "thought he was a wonderful prospect."

"Gosh, I wanted Dennis Smith here," Williams said during an interview on "The David Glenn Show. " "But it didn't work out. We thought we were doing really well (recruiting him) and then we were not. And so it was the kind of thing that his decision was made."

Team Loaded

Before Smith officially made his decision, his father became a head coach in the “Team Loaded” AAU basketball organization. Team Loaded, the organization, began in Virginia, but now, according to its website, “fields over 30 teams” spanning from Washington, D.C., to North Carolina. The elder Smith coached a team that was known as Team Loaded NC. The younger Smith played a starring role.

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All Team Loaded teams are sponsored by adidas. In the federal indictment that details the latest charges in the FBI investigation into college basketball corruption, the authorities allege that the $40,000 payment for Smith was intended, in part, “to further ensure” that he signed an endorsement contract with adidas upon entering the NBA. Instead, after the Dallas Mavericks selected Smith with the ninth pick in the NBA draft, Smith signed with Under Armour.

Graves, the former AAU coach who helped introduce Smith on a national level, referenced Smith’s endorsement deal when he spoke earlier this week. He was talking about the craziness of it all, to him – the idea that a player’s motivation and reputation could be questioned when he might have been unaware that his talents were up for bidding among college coaches, shoe company executives and others.

“Whatever happened, happened, I don’t know who did it, but I know it wasn’t Dennis,” Graves said. “And it’s not going to stop his paycheck from the Dallas Mavericks, or from Under Armour."

Smith’s recruitment ended, officially, on Nov. 12, 2015. He enrolled at N.C. State a couple of months later, in January, after graduating high school early. He spent his first several months there recovering from a knee injury he’d suffered in August 2015.

The expectation, once Smith became healthy, was that the Wolfpack would be competitive – if not for an ACC championship then certainly for an NCAA tournament bid. Instead the season unraveled. Smith mixed in occasional moments of brilliance with others of apathy.

The team won four conference games. Gottfried, now at Cal State-Northridge, lost his job. Adidas lost its pitchman, if the Feds’ indictment is true. Smith, after a strong rookie season in the NBA, with millions to his name, with a burgeoning brand, appears to be the only winner amid all the questions he left behind.