Ernst & Young reported that professional athletes suffered almost $600 million in fraud-related losses from 2004 to 2019. In 2022, Jrue Holiday, Chandler Parsons, and Courtney Lee filed a case against their investment adviser, who had more than two decades of experience. Years after reporting the defrauding issue, the final verdict is here.

All of his former clients took the stand against him at trial and testified. The jury in Manhattan found Darryl Cohen guilty on two counts on Tuesday following a monthlong trial. The former financial agent will serve a maximum sentence of 20 years in prison for persuading his clients to buy so-called viatical life insurance polices.

The policies were bought from a broker and then sold to Cohen’s clients at three or four times the purchase price. From 2017 to 2020, Cohen “orchestrated” a scheme along with an independent financial planner to steal from Jrue Holiday, Parsons, and Lee.

In fact, the sales of life settlement policies were inflated at a rate of as much as 310%, the DOJ said. Because of this, the firm made a $4.5 million profit while Cohen also individually stole $500,000.

Those funds were used to pay for the construction of a home gym in his backyard, according to the DOJ and SEC. Cohen was arrested in March 2023 and convicted of wire fraud and investment advisor fraud.

A Morgan Stanley spokesperson noted the firm had fired Cohen almost six years ago for “outside transactions not disclosed to or approved by” the wirehouse and for “use of an unapproved platform to engage in inappropriate communications with clients.”

Jrue Holiday and other former stars spoke about the injustice

Cohen joined Morgan Stanley in 2015, and that’s where the NBA athletes met him. The Holidays first met Cohen in mid-2015. For Parsons, it was late 2015, and for Lee, it was in 2017, according to their statements to FINRA. Lee, in a statement, had issues with Morgan Stanley. He thought the firm would protect his interest, but “I was wrong,” he said.

Jrue Holiday and his wife, Lauren Cheney, offered a joint statement and were equally disappointed with the firm. “We are all susceptible to being exploited by people like Darryl Cohen. We are disappointed that a company as well-known as Morgan Stanley would enable someone like Mr. Cohen to be in a position that allowed him to move money out of our accounts the way that he did.”

Parsons stated to The New York Times, “I feel violated and taken advantage of.” With the case receiving the verdict, it certainly brought an end to the trauma that the NBA stars had faced. Last year, even Dwight Howard came forward and shared with the world that his agent siphoned $8 million from him under the guise of purchasing a WNBA team.