Ex-Morgan Stanley consultant charged in supposed NBA scams

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Ex-Morgan Stanley advisor charged in alleged NBA fraud

Revealed: The Secrets our Clients Used to Earn $3 Billion

Courtney Lee # 5 and Chandler Parsons #25 of the Houston Rockets come together throughout their video game at Staples Center on April 6, 2012 in Los Angeles, California.

Andrew D. Bernstein|National Basketball Association|Getty Images

Former Morgan Stanley consultant Darryl Cohen was jailed on Thursday early morning for presumably defrauding existing and previous NBA gamers consisting of Jrue Holiday, Chandler Parsons and Courtney Lee.

Cohen is charged with one count of conspiracy to dedicate wire scams and one count of wire scams, according to federal district attorneys. Each count brings approximately a 20- year jail sentence. He is likewise dealing with financial investment consultant scams charges, which bring an optimum five-year jail sentence. Three others, consisting of previous NBA gamers representative Charles Briscoe, were likewise charged.

In the indictment, which was unsealed on Thursday, the Justice Department declared that Cohen and the others took part in 2 scams plans to move approximately $13 million from NBA customers for his individual usage. The gamers weren’t called in the DOJ’s statement.

The DOJ declared that Cohen and his supposed co-conspirators caused the 3 customers to acquire pricey life insurance coverage policies that Cohen later on utilized to do remodellings on his house and swimming pool, along with settle his charge card costs and provide cash to a romantic partner.

Prosecutors likewise declared that Cohen directed the basketball gamers to provide contributions to a not-for-profit, which he eventually utilized to construct athletic centers in his yard.

“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,” stated Damian Williams, the U.S. Attorney for the Southern District of New York, in a Thursday statement.

Cohen was a consultant for Morgan Stanley from 2015 to 2021, according to his Financial Industry Regulatory Authority profile. The DOJ stated in its indictment file that the supposed scams plans occurred from approximately 2017 to2020 Morgan Stanley fired Cohen in 2021 for “transactions not disclosed to or approved by Morgan Stanley and use of an unapproved platform to engage in inappropriate communications with clients,” according to FINRA filings.

“We fully cooperated with the investigation and have resolved clients’ claims related to Mr. Cohen,” Morgan Stanley stated in a declaration. “Mr. Cohen was terminated from the Firm in March 2021 and has since been barred from the securities industry by FINRA.”

The Securities and Exchange Commission likewise charged Cohen on Thursday for presumably defrauding Holiday, Parsons and Lee out of over $1 million.

Cohen’s legal representative, Brandon Reif, did not instantly react to an ask for remark.

The 3 basketball gamers had actually formerly submitted claims versus Morgan Stanley with FINRA. Those cases were later on settled. Phil Aidikoff, who represented Holiday, Parsons and Lee, decreased to comment due to the privacy contracts in the FINRA settlements.