Four NBA players lost $13 million in alleged scam from former Morgan Stanley investment adviser

News erupted this week after it was reported that four NBA players were part of a fraud scheme led by former economic advisers, losing millions of dollars in the process. Only three names have been disclosed at the moment, as it was reported that Jrue Holiday, Chandler Parsons, and Courtney Lee were the latest victims of this scam. 

It seems that a group of four investment advisers, led by a former Morgan Stanley employee, were charged for decieving professional basketball athletes of $13 million, in yet another scheme that targets sports players.

NBA Agent and Financial Advisors Charged in $13 Million Fraud Scheme https://t.co/MvJbowb02c pic.twitter.com/SeKaxoD2AZ

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The band leader looking to cheat players charged by New York’s federal prosecutors is former adviser Daryl Cohen, who made a team that includes a former stockbroker, a financial planner called Brian Gilder, and even an NBA agent!

The prosecutors claim they convinced three players to purchase life insurance policies with numbers up to 310% its usual cost, and then the schemers used some of the money to pay off personal debts like credit card bills and even a $200,000 payment to a person one of the intrigants was having a romatic relationship with.

Another part of the strategy used by Cohen, was to transfer half a million dollars recieved by two athletes, later claiming it was for charity, but later used to build a sports training facility in his backyard. It was revealed that this isn’t the only lawsuit that the scheme leader is enduring at the moment.

The government then said that the second fraud involved NBA agent Charles Briscoe and Calvin Darden Jr., who planned the sale of a women’s professional team, and then spent almost $900,000 on luxury cars and other personal spoils.

This isn’t the first time NBA athletes are being targeted for scams

There’s been a rising trend of frauds targetting professional players that take advantage of their financial inexperience and million dollar salaries. It was reported that from 2004 to 2019, athletes have announced losing a total of $600 million in fraud-related cheats.

In Cohen’s case, the multinational investment company Morgan Stanley said they had fired him some time ago and were even working side-by-side with the authorities.

“We fully cooperated with the investigation and have resolved clients’ claims related to Mr. Cohen,” the firm said in a statement. “Mr. Cohen was terminated from the firm in March 2021 and has since been barred from the securities industry by Finra.”

On the other hand, Cohen’s lawyer Mark Sedlander insists that his client is innocent. “Mr. Cohen denies the charges and looks forward to fighting them in court,” he said.

Just a year ago, a fraud happened the other way around, as 18 former NBA players were charged for a fraud scheme pretending they were injured to cheat the insurance companies.

In this opportunity, the player’s attorney, Phil Aidikoff, admires the way the government has taken charge of the situation. “I think this was an appropriate action for the government to take to deal with a very, very significant course of conduct by a broker at a wirehouse,” the lawyer said of the charges.

As the prosecutors explained, Cohen and Gilder convinced the three players to buy policies from 2017 to 2020 with inflated sales. The reports suggest the alleged thiefs made at least $4.5 million from the scam.