On November 17, 2017, the Securities and Exchange Commission announced that a final judgment had been entered against a former professional football player and his co-defendants for defrauding investors in a Ponzi scheme. The $15.7 million final judgment comes after the SEC filed a complaint against the defendants on April 1, 2015. It was alleged that defendants, William D. Allen, Susan Daub, and related entities Capital Financial Partners LLC, Capital Financial Partners Enterprises LLC, and Capital Financial Holdings LLC raised nearly $32 million from investors who were promised profits from loans to professional athletes.
The complaint suggests that the defendants mislead investors about the terms, circumstances and the existence of some of the loans. The defendants are accused of only using a portion of the funds to make the promised loans. Instead, the SEC suggests that the defendants used a portion of the funds for personal expenses, including charges at nightclubs and casinos. The SEC obtained an asset freeze as well as other preliminary relief after filing the complaint.
In November of 2016, Allen and Daub pleaded guilty to related criminal charges. On March 1, 2017, each was sentenced to six years imprisonment and ordered to pay $16.8 million in restitution. More details can be found here.
