This started out as a comment to Mike's excellent post here, but it got so long I decided to give it its own separate post. Mike pondered whether it's okay to veto a trade if it's so lopsided it destroys league balance, even if it's technically not collusion. I answer unequivocally: Hell, yes, it's okay.
I play in a highly competitive, 14-team money league (called A1A Fantasy Sports) that uses a "commissioner review" trading policy. (When a trade is proposed by one team and accepted by another, all managers in the league have a right to protest, though it's the commissioner -- which happens to be me in this case -- who ultimately decides whether to approve or reject the trade.)
I don't reject trades lightly. Since 2000, I've only rejected two trades -- one in fantasy baseball and one in football. (And the football one was borderline collusion.) We've had managers protest many, many more, but I try my best to let players manage their rosters how they see fit. (The last one I really struggled over was this one from early last year, which I ultimately approved.)
Still, I think you need to draw the line somewhere, especially in leagues with hundreds (sometimes thousands) of dollars on the line. Egregiously lopsided trades need to be rejected to protect the rest of the league's managers (who are playing in good faith and for serious money), as well as the integrity of the league itself.
Many leagues use league-wide veto systems, where a trade must be approved by a majority of the league, but I find that can lead to "payback votes" where managers vote no on a trade just because a participant in that trade had done the same to them earlier in the year ... or because they didn't agree with the last trade a participant made ... or any of the number of reasons that can lead to an irrational veto based on emotion rather than reason.
Because of that, I think a "commissioner review" system works best for big money leagues, as long as you find a commissioner who is level-headed and fair, and will carefully consider all arguments made by other managers of the league. This system has not always been universally loved by our managers, but it's been successful enough that, eight years in, we've never had a manager quit over a trading controversy.
To enforce our system, we have a league constitution that deals entirely with trading. (Yes, we are that geeky and take this stuff that seriously.) I know it sounds very rigid and, quite honestly, not much fun. But it's also inconsequential as long as you have a league full of managers who get the game, play smart and always work hard to better their own team. And isn't that what we all want? Here's our constitution in full, for those who are interested:
ABOUT PLAYER TRADES
Trades are not a right, they're a privilege. When you pay your entry fee to play A1A, you buy the right to draft any players you see fit and pick up any players you choose from the free agent pool/waiver wire. You DO NOT purchase the right to make any trade you please. Trading is regulated in A1A, and the Commissioner withholds the right to reject a trade for a number of reasons. As an example, in football, if you're only carrying one quarterback on your roster and that quarterback gets hurt -- and no starting QBs are available on the waiver wire to pick up -- you may find yourself soliciting trade offers for a quarterback with the promise to take the best trade offered. The Commissioner is NOT obligated to approve that trade. It's for this reason that all managers are strongly advised to strengthen their teams through the draft and free agency early and often.
Reasons a trade can be rejected:
1. Collusion: This occurs when a manager makes a trade to purposely better another team without actually improving their own team. Collusion can range from a serious offense (such as one manager trading to improve the team of another manager in exchange for a cut of the prize money) to a seemingly harmless transaction (such as trading a bench player you don't really need to your brother just because your brother needs that player to fill a hole), but either way, it's absolutely not allowed in A1A. When a trade is agreed upon, the Commissioner withholds the right to ask each manager how the trade improves his team, as well as the right to reject the trade if a manager's answer to that question proves unsatisfactory. Collusion can result in a manager's expulsion from A1A.
2. Imbalance of players: If the Commissioner determines that a trade is unbalanced -- i.e. one manager is giving up too much and getting too little in return -- he withholds the right to reject that trade to preserve a league-wide level playing field and to protect the other 12 players in the league not involved with the trade. Whether a trade is unbalanced or not is solely up to the discretion of the Commissioner, but other managers have the right to protest (or defend) a pending trade from the time a trade is accepted up until the time the trade is approved or rejected by the Commissioner. Several factors are weighed when determining if a trade is unfair -- including current year statistics, career statistics, perceived value of a player, where a player was drafted, what hole or holes on a team a traded-for player would fill, etc. -- though, ultimately, it is a judgment call by the Commissioner. Keep in mind, however, current year statistics will carry more and more weight the further into the current season we are.
3. A sudden injury or change in player value. In A1A, a trade is not absolutely final until the Commissioner accepts it. So if one manager trades Player A to another manager for Player B and then Player A gets hurt before the Commissioner accepts the trade, that trade will be rejected since the perceived values of those two players has now changed (unless both managers make it clear that they still want to make the trade even after the injury or value-changing event occurs).
In the end. We want A1A managers to be able to trade as often as they want to improve their fantasy team, but not at the expense of preventing every manager from having a legitimate chance to win the league. Thus, the Commissioner expects trades to be fair and balanced, as well as done for the right reason - the betterment of your team.