18 former NBA players indicted in $ 4 million insurance fraud scheme

Greg Smith had been out of the National Basketball Association for about two years in December 2018, when the former power forward for the Houston Rockets and Dallas Mavericks had what appeared to be a long day at a dental office in Beverly Hills. Bills submitted on his behalf showed that he received IV sedation and root canals, and crowns were placed on eight teeth.

But the bills, totaling $ 47,900, were bogus, federal prosecutors in Manhattan said Thursday.

Smith was actually thousands of miles from California, playing basketball in Taiwan at the time, prosecutors said, adding they had evidence to prove it, including box scores that showed he had appeared in games there.

Mr. Smith was one of 18 former NBA players who were charged in what federal authorities described as a blatant conspiracy to defraud a health care program extended to current and former NBA players.

Claims brought by another defendant, Sebastian Telfair, a Brooklyn high school legend who passed into the career of an officer, suggested truly regrettable dental problems. His claims showed that he had received root canals on 17 teeth in one year, according to the indictment. He pleaded not guilty Thursday and was released on bail.

“The defendant’s playbook involved fraud and deception,” Audrey Strauss, US Attorney for the Southern District of New York, said at a news conference Thursday announcing the charges.

“Their supposed plan has been interrupted and they will have to answer for their flagrant violations of the law,” Ms. Strauss said..

She and Michael J. Driscoll, the head of the FBI’s New York office, added that the investigation was continuing.

Prosecutors said the former players, and the spouse of a player who was also charged, filed claims totaling $ 3.9 million, eventually receiving about $ 2.5 million in fraudulent winnings.

While none of the defendants were superstars, several were well-known players, such as defensive stalwart Tony Allen and Ronald Glen Davis, who went by their middle names and was nicknamed “Big Baby.” They both played on the Boston Celtics team that won the NBA championship in 2008.

Another defendant, Terrence Williams, who prosecutors said had orchestrated the scheme, had some success during his college years at the University of Louisville, but had an uneventful professional career after being Drafted in the first round by the New Jersey Nets in 2009.

Williams also received bribes of at least $ 230,000 from 10 of the former players accused of participating in the scheme, according to the indictment.

Each of the defendants was charged with one count of conspiracy to commit health care fraud and wire fraud, and Mr. Williams was also charged with aggravated identity theft. The conspiracy charge carries a maximum prison sentence of 20 years, the government said.

Attorneys for many of the defendants could not be immediately identified Thursday for comment. Telfair attorney Deborah A. Colson declined to comment.

In a statement, the NBA called the allegations “particularly daunting” and said it would fully cooperate with the investigation. The league’s players union said it was aware of the allegation and was monitoring the case.

According to the indictment, Williams first filed a fraudulent claim seeking reimbursement of $ 19,000 for services he allegedly received from a chiropractor in Encino, California. After the claim was approved and he received $ 7,672, he began recruiting others, according to the indictment.

Some of the medical claims made by the former players were identical, testing credulity, prosecutors suggested.

Mr. Davis, Mr. Allen, and a third defendant, Tony Wroten, for example, claimed to have had root canals on the same six teeth on the same date in April. 2016, and crowns on those teeth a month later, according to the indictment.

Some of the claims filed as part of the plan resulted in large refunds, prosecutors said. Four of the former players each received more than $ 200,000 after claiming to have visited the same chiropractor as Mr. Williams, according to the indictment. One of the four, Shannon Brown, received $ 320,000.

But the nearly $ 4 million that prosecutors said the defendants sought in the scheme is still a fraction of the tens of millions of dollars some of the defendants made in their NBA careers.

Several of the defendants played at least part of their careers for teams in the New York area, including Mr. Brown with the Knicks and Mr. Williams, Antoine Wright and Chris Douglas-Roberts with the Nets.

Telfair, a cousin of former NBA star Stephon Marbury, was featured on magazine covers as one of the best high school players in the country when he played at Lincoln High School in Brooklyn in the early 2000s, even appearing alongside to a teenage LeBron James on a Slam magazine cover in 2002. But he was haunted by gun-related legal issues during his professional career, which included early stints with the Portland Trail Blazers and Celtics.

In 2008, Telfair pleaded guilty to illegal possession of firearms and was sentenced to three years of probation. In 2019, he was sentenced to three and a half years in prison for possession of weapons, this time due to an arrest two years earlier when he was found. with four loaded pistols and a bulletproof vest.

The indictment revealed Thursday said that to receive benefits from the health care program, players must have spent at least three seasons on an NBA team roster.

That may be one of the reasons why the names of many of the defendants in the scheme sparked recognition, and even nostalgia, from dedicated NBA fans, for whom they were memorable, albeit minor, actors.

Among the defendants was Milton Palacio, a former Boston Celtic, who in 2000 struck a wild buzzer against the Nets after stealing a pass. Palacio, now an assistant coach for the Portland Trail Blazers, was placed on administrative leave after the charges were announced, according to a team statement.

The defendants also included promising prospects whose careers did not reach the heights that had been expected, such as Darius Miles and Mr. Telfair, who were each recruited after finishing high school.

And there was Ruben Patterson, who spent his rookie year with the Los Angeles Lakers and said to himself: maybe apocryphal – calling himself the “Kobe Stopper”, for his alleged ability to stop Kobe Bryant when Mr. Patterson protected him later in their careers.

Perhaps the most successful player to be charged was Mr. Allen, who made several fully defensive teams between 2011 and 2017. Next year, he is scheduled to have your number withdrawn by the Memphis Grizzlies.

Soup Deb contributed to reporting.

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