Jrue Holiday and former NBA players were targets of a fraud scheme involving around $13 million.
CNBC reports Darryl Cohen — an advisor who previously worked for Morgan Stanley — is accused of transferring about $13 million from multiple NBA clients.
According to federal prosecutors, Cohen has been charged with one count of conspiracy to commit wire fraud and one count of wire fraud. In addition, he is charged with one count of investment advisor fraud, “which carries a maximum sentence of five years in prison.”
Additionally, The Securities and Exchange Commission (SEC) is charging Cohen for allegedly defrauding the NBA players out of $1 million.
A number of schemes were also carried out by Cohen with the help of three others, including former NBA agent Charles Briscoe, who was “also charged with one count of aggravated identity theft.” The other two individuals allegedly involved were Brian Gilder and Calvin Darden, Jr.
Cohen allegedly used funds to pay off credit card debt and build athletic facilities in his backyard.
There is a possibility that all four individuals involved in the wire fraud and conspiracy could spend up to 40 years in prison.
“These defendants believed that defrauding their professional athlete clients of millions of dollars would be a layup. That was a huge mistake, and they now face serious criminal charges for their alleged crimes,” said Damian Williams, the U.S. attorney for the southern district of New York in a press release.
In court papers, none of the players who were scammed were identified. However, according to an attorney representing the athletes in Cohen’s civil case, there are three athletes involved: Holiday, Chandler Parsons, and Courtney Lee.
Morgan Stanley said Cohen was released from his position in 2021, and it’s willing to cooperate with the investigation.
“We fully cooperated with the investigation and have resolved clients’ claims related to Mr. Cohen,” Morgan Stanley said in a statement, CNBC reports. “Mr. Cohen was terminated from the Firm in March 2021 and has since been barred from the securities industry by FINRA.”