Former NBA players charged in $4M health care fraud scheme


Jun 15, 2021
Like these guys need more money

Eighteen former NBA players were charged Thursday with pocketing about $2.5 million illegally by defrauding the league's health and welfare benefit plan in a scam that authorities said involved claiming fictitious medical and dental expenses.

"The defendants' playbook involved fraud and deception," U.S. Attorney Audrey Strauss said at a news conference after FBI agents across the country arrested 15 former players and one of their wives after an alleged three-year conspiracy that authorities say started in 2017.

Arrests occurred in Washington state, California, New York, Alabama, Illinois, Florida, Nevada, Georgia and Tennessee. All were charged with conspiracy to commit health care fraud and wire fraud, which carries the potential penalty of up to 20 years in prison.

According to an indictment returned in Manhattan federal court, the former players teamed up to defraud the supplemental coverage plan by submitting fraudulent claims to get reimbursed for medical and dental procedures that never happened.

Strauss said prosecutors have travel records, email and GPS data that prove the former players were sometimes far from the medical and dental offices at the times when they were supposedly getting treated.

In one instance, she said, a former player was playing basketball in Taiwan when he was supposedly getting $48,000 worth of root canals and crowns on eight teeth at a Beverly Hills, California, dental office in December 2018.

The indictment said the scheme was carried out from at least 2017 to 2020, when the plan -- funded primarily by NBA teams -- received false claims totaling about $3.9 million. Of that, the defendants received about $2.5 million in fraudulent proceeds.

Strauss said each defendant made false claims for reimbursements that ranged from $65,000 to $420,000.

"The benefit plans provided by the NBA and the National Basketball Players Association to our players are critically important to support their health and well-being throughout their playing careers and over the course of their lives, which makes these allegations particularly disheartening," the NBA said in a statement. "We will cooperate fully with the U.S. Attorney's Office in this matter."

Michael J. Driscoll, the head of New York's FBI office, said the case demonstrated the bureau's continued focus on uncovering health care fraud scams that cost the health care industry tens of billions of dollars per year.

Strauss said the conspiracy was led by Terrence Williams, who began his career as a first-round pick in 2009. The indictment said he submitted $19,000 in fraudulent claims to the plan in November 2017 for chiropractic care. The claims led to a $7,672 payout for Williams.

The indictment said he then recruited other former NBA players to defraud the plan and offered to provide fraudulent invoices from a chiropractor and dentist in Southern California and a wellness office in Washington state. At least 10 of the former players paid kickbacks totaling about $230,000 to Williams, according to the court papers.

Williams was also charged with aggravated identity theft, which carries a potential penalty of up to two years in prison.

Strauss said that charge was lodged because Williams tried to frighten a co-defendant into paying a kickback by impersonating an employee from the health plan's administrative manager, claiming there was an issue with an invoice that might require the co-defendant to pay back money he had received.

A lawyer who has represented Williams in the past declined to comment.

The Nets selected Williams with the 11th pick in the 2009 NBA draft. He went on to play for four franchises -- the Nets, Celtics, Rockets and Kings -- over four seasons as a role player, averaging 7.1 points per game. He was waived by Boston two days after his 26th birthday in 2013 and didn't appear in the league again.

Also among those charged was Tony Allen, a six-time All-Defensive team selection and member of the 2008 champion Celtics, along with his wife. Tony Allen was not in custody as of Thursday afternoon. The Memphis Grizzlies announced weeks ago that they plan to retire Allen's number at a Jan. 28 game versus the Utah Jazz.

For the most part, though, the former players involved had journeyman careers playing for several teams and never reaching anywhere close to the enormous stardom or salary that top players command.

Still, the 18 players combined to make $343 million in their on-court NBA careers, not counting outside income, endorsements or what any made playing overseas.

Strauss declined to speculate on their motivations or financial situations, saying that doing so would go beyond the facts in the indictment.

One former player charged, Milt Palacio, was placed on administrative leave from his role as a Portland Trail Blazers assistant coach, with the team saying it would not comment further amid the legal process.

Another former player charged was Sebastian Telfair, a onetime high school star in New York who was highly touted when he turned pro, though his NBA career with eight franchises never brought the stardom some had expected.

Telfair's finances qualified him for a court-appointed attorney at an appearance in Manhattan before a magistrate judge, who set bail at $250,000, although Telfair was freed on his signature alone.

His lawyer, Deborah Colson, declined comment. Telfair, in running clothing and green sneakers, did not respond to requests for comment outside the courtroom, where Colson had entered a not guilty plea on his behalf.

Those charged included four NBA champions. Glen Davis, along with Allen, was part of that 2008 title team in Boston; Shannon Brown won two championships with the Los Angeles Lakers; and Melvin Ely won a title with the San Antonio Spurs in 2007.

Among others who were charged, Tony Wroten, Ruben Patterson and Darius Miles were the only players who averaged double figures for their NBA career.

Wroten averaged 11.1 points in 145 career games. Patterson averaged 10.7 points per game with six teams. Miles, the No. 3 pick in the 2000 draft, averaged 10.1 points per game while playing with four franchises.

Thursday's charges came just weeks after former NFL players Clinton Portis, Tamarick Vanover and Robert McCune pleaded guilty for their roles in a nationwide health care fraud scheme.

The Associated Press contributed to this report.