Need a case example of how lying can cost you dearly? Look no further than Olympic gold medal swimmer Ryan Lochte whose fabricated story about an armed robbery in Rio led to the loss of four prime endorsements by Speedo, Ralph Lauren, skin care firm Syneron-Candela and Japanese mattress maker airweave.
Lochte reportedly earned $2.3 million annually from his Olympic swimming sponsorships leading up to the 2012 Olympics in London, according to The Washington Post. One expert estimates Lochte's lifetime lost earnings from the four dropped sponsorships could be as much as $20 million.
In an interview with NBC’s Matt Lauer, Lochte took responsibility for the incident involving three other U.S. Olympians following a night of reverie that took a pit stop at a Rio gas station. Lochte admitted he was intoxicated and damaged a bathroom door. He was less definitive about other damage in the bathroom.
Lochte, who returned his hair to its normal shade of brown, also admitted “over-exaggerating” his encounter with a security guard who pulled his gun and pointed it at him. Lochte initially said he and his fellow swimmers were yanked from a cab and robbed at gunpoint. Now, he says, the guard confronted them after hearing loud noises in the bathroom and drew his weapon after Lochte acted aggressively. Lochte claims he was still drunk when he spun his robbery story.
While Lochte managed an apology to Brazil for not telling the truth, Brazilian authorities and news media are understandably not satisfied. Lochte’s untruthful tale touched a nerve in a country highly sensitive about its chronic crime rate. They correctly note Lochte only confessed to lying after surveillance camera video showed what really happened – or didn’t happen.
Intermixed in his apology, Lochte said some of the right things. But probably not enough of them. For one, he failed to say how it would make the situation right. That would require more than paying to repair the damage. It might take an act of attrition or a contribution to a cause dear to the heart of Brazilians. (Speedo said the company is donating $50,000 of Lochte’s fee to Save the Children, which will direct the money to add Brazilian children.}
Ralph Lauren removed Lochte's image from its website congratulating U.S. Olympians it sponsored. The company said Lochte’s deal was for the 2016 Olympics and wouldn’t be renewed.
The U.S. Olympic Committee has warned that punishments may lie ahead for Lochte.
At age 32, Lochte’s Olympic career is probably over anyway. His actions, which he described as “immature,” have put a serious dent in his reputation as well as his pocketbook. In the trade, he would be called “damaged goods.” Self-inflicted damaged goods.
Lochte may recover his reputation, and we sincerely hope he does take steps to do that. But his actions and prevarications are a stark reminder that reputation matters – and take only a few seconds to blow up.