December 2, 2023

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4 people accused of $13 million in fraud schemes for professional athletes

Four people were arrested Thursday and charged with collectively defrauding four men’s professional basketball players out of more than $13 million, according to Damian Williams, the United States Attorney for the Southern District of New York.

In one scheme, three players were persuaded to purchase more than $5 million in life insurance policies at an outrageous price. In another game, a fourth player spent $7 million to buy a women’s professional basketball team, but prosecutors said the money never went to buy a team. In the third scheme, the player spent $1 million to fund a representation agency for players that hadn’t existed before, according to indictment.

“These defendants believe it would be negligent to defraud their professional sports clients out of millions of dollars,” Williams said in a statement. This was a huge mistake, and they are now facing serious criminal charges for their alleged crimes.”

Daryl Cohen, Brian Gilder, Charles Briscoe, and Calvin Darden Jr. were each charged with one count of wire fraud and one count of conspiracy to commit wire fraud. Each charge carries a maximum penalty of 20 years in prison.

Cohen, formerly a broker at Morgan Stanley, has also been charged with investment advisor fraud. Briscoe, formerly an authorized NBA agent, was also charged with one count of aggravated identity theft.

Cohen, Gilder, Briscoe and Darden could not be reached for comment, and court filings do not include attorneys for any of them. Brandon Reeve, an attorney who previously represented Cohen, did not immediately respond to a request for comment Thursday.

In a statement, Morgan Stanley, where Cohen worked from 2015 to 2021, said he was “terminated” in March 2021 and has since been banned from the securities industry. “We have cooperated fully with the investigation and have resolved customer allegations regarding Mr. Cohen,” a spokeswoman for the company said.

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The US Securities and Exchange Commission also filed a civil complaint against Cohen.

The identities of the professional athletes who prosecutors said were defrauded have not been released. But many details of the life insurance plan appear to match claims made by Gro, Lauren Holiday, Chandler Parsons and Courtney Lee, who previously described allegations of being defrauded by Cohen to The New York Times.

Jrue Holiday plays for the Milwaukee Bucks of the NBA, and his wife, Lauren Holiday, is a former professional soccer player. Parsons and Lee are two former NBA players. They all said they had filed cases against Cohen with the Financial Industry Regulatory Authority, which oversees brokerage firms.

According to the indictment, between 2017 and 2020 Cohen and Gilder solicited three NBA players to purchase about $6.2 million in life insurance policies, of which Cohen and Gilder “secretly made” about $4.5 million. Cohen allegedly gave about $200,000 of the money to someone with whom he was in a romantic relationship and used the other money to pay off a former professional baseball player he was threatening to sue and pay and renew his credit card bill. home, according to prosecutors.

Another plan included purchasing a women’s professional basketball team, according to the indictment. An NBA player wanted to buy the team, but was prevented from doing so by the league’s collective bargaining agreement.

Prosecutors said the player discussed an “arrangement” with Briscoe, Darden and others, in which the player would buy the team indirectly through a company controlled by a relative of Darden. The player transferred $7 million into a bank account controlled by Darden to buy the team. But instead, prosecutors said, Darden wired more than $1 million to Briscoe and more than $500,000 to a relative, then spent the rest on cryptocurrency, a house, luxury cars, art, and a piano.

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According to court filings, Cohen, Briscoe and Darden are also accused of defrauding an NBA player who wanted to start a player representation agency that he would run after his retirement. The player gave Briscoe $1 million so the agency could pay the expenses associated with signing a top prospect. But prosecutors said the potential client did not sign with the agency, and the contract he allegedly signed was fraudulent. According to the indictment, the money was transferred to Briscoe, who paid off a debt and gave some of it to Darden.