Tuesday, April 7, 2015

Former NFLer Will Allen Ran $32 Million Ponzi Scheme

Will Allen, a 36-year-old cornerback who was drafted in the first round by the New York Giants in 2001 and recently played for the New England Patriots before being placed on injured reserve and leaving professional football in March 2013 has been running a Ponzi scheme that bilked investors out of $32 million through fraudulent loans to professional athletes, regulators alleged in a lawsuit Tuesday. According to the civil lawsuit, Will and his partner, 54-year-old Susan Daub, formed Capital Financial Partners, a firm that purported to make short-term loans to athletes during the off-season — a potentially lucrative business with high interest rates, the Securities and Exchange Commission said in its suit. Regulators say the duo raised $4 million from 24 investors for an NHL player after trotting out a sham promissory note and loan agreement from the unnamed player for $5.65 million in April and May of 2014. But the player never signed that note and the real loan, which was kept from investors, was actually $3.4 million. Even after the hockey player filed for bankruptcy, Susan told investors the loan was “performing as expected,” according to the suit. According to the SEC, the pair used “false documentation in order to mislead investors as to the terms, circumstances, and even existence of some of the loan transaction in which the investors are induced to participate.” The pair withdrew $7 million of investor money for personal expenses -- "charges at casinos, pawn shops, jewelers, grocery stores, cigar shops, and clothing retailers" -- and to fund other business ventures, according to the complaint.

Here is the complaint:

source: NY Post

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