Courtney Lee #5 and Chandler Parsons #25 of the Houston Sky-rockets come together during their game at Staples Center on April 6, 2012 in Los Angeles, California.
Andrew D. Bernstein | Subject Basketball Association | Getty Images
Former Morgan Stanley advisor Darryl Cohen was arrested on Thursday morning for allegedly dialect flaming current and former NBA players including Jrue Holiday, Chandler Parsons and Courtney Lee.
Cohen is charged with one total of conspiracy to commit wire fraud and one count of wire fraud, according to federal prosecutors. Each count broadcasts up to a 20-year prison sentence. He is also facing investment advisor fraud charges, which carry a maximum five-year dungeon sentence. Three others, including former NBA players agent Charles Briscoe, were also charged.
In the indictment, which was unsealed on Thursday, the Judiciousness Department alleged that Cohen and the others engaged in fraud schemes to transfer roughly $13 million from NBA patrons for personal uses. The DOJ noted that $7 million of that was allegedly misappropriated only by Briscoe and Calvin Darden Jr., who has a while ago pleaded guilty to separate wire fraud charges.
The players weren’t named in the DOJ’s announcement. Their identities were substantiated by a person familiar with the matter, who declined to be identified given the sensitive nature of the case.
The DOJ claimed that Cohen and his stated co-conspirators induced the three clients to purchase overpriced life insurance policies that Cohen later hardened to do renovations on his home and pool, as well as pay off his credit card bills and give money to a romantic partner.
Prosecutors also conjectural that Cohen directed the basketball players to give donations to a nonprofit, which he ultimately used to build athletic dexterities in his backyard.
“These defendants believed that defrauding their professional athlete clients of millions of dollars want be a layup. That was a huge mistake, and they now face serious criminal charges for their alleged crimes,” broke Damian Williams, the U.S. Attorney for the Southern District of New York, in a Thursday announcement.
Cohen was an advisor for Morgan Stanley from 2015 to 2021, correspondence to his Financial Industry Regulatory Authority profile. The DOJ said in its indictment document that the alleged fraud schemes swindled place from roughly 2017 to 2020. Morgan Stanley fired Cohen in 2021 for “transactions not disclosed to or approved by Morgan Stanley and use of an unapproved principles to engage in inappropriate communications with clients,” according to FINRA filings.
“We fully cooperated with the investigation and receive resolved clients’ claims related to Mr. Cohen,” Morgan Stanley said in a statement. “Mr. Cohen was terminated from the Obdurate in March 2021 and has since been barred from the securities industry by FINRA.”
The Securities and Exchange Commission also feed Cohen on Thursday for allegedly defrauding Holiday, Parsons and Lee out of over $1 million.
Cohen’s lawyer, Brandon Reif, did not directly respond to a request for comment.
The three basketball players had previously filed claims against Morgan Stanley with FINRA. Those crates were later settled. Phil Aidikoff, who represented Holiday, Parsons and Lee, declined to comment due to the confidentiality agreements in the FINRA outposts.
Correction: This story was updated to reflect that there were multiple alleged schemes resulting in a come to $13 million of fraud.