SEC Charges Financial Adviser for Misappropriating More Than $1 Million From Current, Former NBA Players
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 a period of two and a half years.
According to the SEC’s complaint, from October 2017 through
April 2020, 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.
"As the complaint alleges,
instead of protecting his clients’ investments, Cohen took advantage
of their trust for his personal gain," said Andrew Dean, Co-Chief of
the Asset Management Unit. "Protecting investors from fraud by their
financial advisers is a priority for the SEC. "
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.