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Former NBA Players Charged in $4 Million Health-Insurance Fraud

Eighteen former National Basketball Association players were charged in an alleged scheme to scam a league healthcare fund out of nearly $4 million, according to an indictment unsealed Thursday in federal court in New York.

The U.S. attorney’s office in Manhattan accused the former players, including guard

Sebastian Telfair,

small forward

Tony Allen

and power forward Ronald Glen “Big Baby” Davis, of submitting false claims for reimbursement of medical and dental expenses for services they didn’t receive or pay for. In all, the players pocketed about $2.5 million in fraudulent proceeds, the indictment said.

The players were charged with conspiracy to commit healthcare fraud, which carries a maximum of 20 years in prison.

Terrence Williams,

a onetime shooting guard for the Houston Rockets and the Nets when the team played in New Jersey, was also charged with aggravated identity theft. At a news conference Thursday, Manhattan U.S. Attorney

Audrey Strauss

called Mr. Williams “the scheme’s linchpin.”

Many of the defendants were low- to midlevel players in the NBA in the 2000s. Most have been out of the league a few years, although some recently played professional basketball overseas. Mr. Davis, who spent eight years in the NBA, won a championship in 2008 with the Boston Celtics. Mr. Allen was on the same championship team and was a six-time member of the league’s all-defensive team.

Prosecutors said that from 2017 through 2020, Mr. Williams obtained fraudulent medical and dental invoices, which he sent to other former NBA players. Those players then submitted fraudulent claims to the NBA’s healthcare fund, and, unaware the claims were fraudulent, the plan paid the claims, according to prosecutors.

Mr. Williams received about $230,000 in kickbacks from the defendants, according to the indictment. He is also accused of reviewing some of the other players’ claims before they were submitted.

When one player didn’t pay a kickback, Mr. Williams impersonated a plan manager in an email and pretended there was a problem with an invoice, prosecutors said.

Desiree Allen,

Mr. Allen’s wife, was also charged, according to the indictment.

Audrey Strauss, the U.S. attorney for the Southern District of New York, laid out the charges against the former NBA players on Thursday.


Mary Altaffer/Associated Press

Federal agents arrested 16 defendants across the country on Thursday morning, Ms. Strauss said. Lawyers for the defendants couldn’t be identified.

Ms. Strauss said the investigation was ongoing.

The healthcare plan was funded by NBA teams, according to the indictment. It is administered by a board of trustees appointed by the NBA and the National Basketball Players Association, the labor union.

The NBA said in a statement that it would cooperate with the U.S. attorney’s office. It said the healthcare fund plan supports players’ health and well-being “throughout their playing careers and over the course of their lives, which makes these allegations particularly disheartening.”

The players association said in a statement that it was aware of the indictment and would continue to monitor the matter.

Ms. Strauss said that the players each sought reimbursements for fake medical expenses ranging from $65,000 to as much as $420,000.

In one instance, Mr. Williams submitted a bogus claim for $19,000 worth of expenses for services at a chiropractic office in Encino, Calif., according to the indictment. The healthcare plan approved the claim, paying Mr. Williams $7,672.55.

Players also submitted phony claims from two dental offices in Beverly Hills, Calif., and a wellness office in Washington state that specialized in sexual health and antiaging.

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In some cases, Ms. Strauss said, travel records, emails and other evidence showed the players submitted claims for procedures in medical offices far from their current locations. One player,

Gregory Smith,

submitted claims for root canals and crowns on eight teeth in Beverly Hills, she said.

“But Smith was nowhere near Beverly Hills, or even in the state of California,” Ms. Strauss said, but rather playing basketball in Taiwan.

Other players claimed they had root canals on the same teeth, all on the same day, she said.

Many of the fake invoices that players submitted to the healthcare plan described the same chiropractic and dental services. In some cases, players submitted letters from the chiropractic office, a dentist or a physician explaining the services were needed to treat injuries, the indictment said. Some of the letters weren’t on letterhead and had grammatical errors, according to the indictment. One even misspelled a player’s name.

The healthcare fund paid Mr. Allen $420,075 in reimbursements for chiropractic and dental services he claimed, according to the indictment. Mr. Telfair received $358,356 from the fund for chiropractor and dental services, the indictment said.

The fund later reviewed the claims submitted by Messrs. Allen and Telfair and other players and retroactively denied the payments. Mr. Allen repaid the fund $350,075, the indictment said, while Mr. Telfair didn’t make any repayments.

Write to Corinne Ramey at [email protected]

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Source: on 2021-10-07 12:03:48

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