The Securities and Exchange Commission today charged Darryl Matthew Cohen, a former investment adviser at a large financial institution, with misappropriating more than $1 million from three current and former NBA players over two and a half years. A current NBA player, his wife and two former NBA players allege that Darryl Matthew Cohen improperly diverted a total of about $10 million from their accounts, according to a recent New York Times article. According to reports, the athletes have filed claims in the Finra arbitration system. The athletes who allege Cohen stole from them are Jrue Holiday, who plays in the NBA for the Milwaukee Bucks, his wife Lauren Holiday, a former professional soccer player, and two former NBA players, Chandler Parsons and Courtney Lee. Parsons most recently played for the Atlanta Hawks, while Lee was a member of the Dallas Mavericks before he retired.
According to the SEC’s complaint,https://www.sec.gov/litigation/complaints/2023/comp-pr2023-60.pdf Cohen used client funds, without their understanding or authorization, for personal expenditures including to support his son’s amateur basketball program, for a home gym, and to pay back another client whose funds Cohen had misappropriated. Cohen also allegedly sold life insurance settlements to the clients for kickbacks to fund his home improvements.
The SEC’s complaint, filed in U.S. District Court for the Southern District of New York, charges Cohen with violating the antifraud provisions of the federal securities laws. The complaint seeks permanent injunctive relief, disgorgement and prejudgment interest, and a civil penalty. In a parallel action, the U.S. Attorney’s Office for the Southern District of New York today announced criminal charges against Cohen.
The SEC’s ongoing investigation is being conducted by Payam Danialypour and Manuel Vazquez and supervised by Brent Wilner, all of the Asset Management Unit. The litigation will be led by Stephen Kam and supervised by Gary Leung of the Los Angeles Regional Office. The SEC appreciates the assistance of the U.S. Attorney’s Office for the Southern District of New York and the Financial Industry Regulatory Authority.
Jeffrey Newman is a whistleblower lawyer who handles cases in the SEC whistleblower program and also under the False Claims Act. He can be reached at 617-823-3217 or Jeffrey.newman1@gmail.com
