Ponzi Scheme Preyed on Athletes
A former Miami Dolphins player and a bank executive have been convicted in a Ponzi scheme involving other athletes. Former Miami Dolphins player Will Allen and Susan Daub pleaded guilty to two counts of wire fraud, one count of conspiracy, and one count of money laundering in a Massachusetts federal court.
They were first arrested on criminal charges in June 2015 after being sued by the Securities and Exchange Commission earlier that year.
The pair were charged with operating a $32 million dollar Athlete Ponzi Scheme Boston-based Capital Financial Partners LLC. The firm would advertise private lending and short-term loans to athletes short on cash. Average loan amounts were about $600,000 on a 12-month term at favorable rates.
To pay out the loans the duo would solicit money from investors, telling them that they would profit from interest payments, which were as high as 18 percent. The duo often collected more money than was being loaned and regularly oversubscribed investments. The money was collected between June 2012 and March 2015.
While the duo did make some loans to athletes, the bulk of the money was diverted to personal accounts and other businesses. Some of the money also was used to pay off earlier investors, typical of a Ponzi scheme. According to the U.S. Attorney’s office, Allen and Daub took in more than $35 million in investments, repaying less than $22 million.
About Athlete Ponzi Scheme Perpetrators Allen and Daub
Former football player Will Allen played for the Miami Dolphins and New York Giants between 2001 and 2012. In 2012, he signed a one-year contract with the New England Patriots. Susan Daub is a 55-year-old former bank executive. It is not reported how the two met and decided to start their scheme.
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