Portland Trail Blazers guard Jrue Holiday (5) drives to the basket during the first half of an NBA basketball game against the Minnesota Timberwolves, Tuesday, Feb. 24, 2026, in Portland, Ore. (AP Photo/Jenny Kane)
A jury has found a former Morgan Stanley financial advisor guilty of defrauding three current or former professional basketball players who were his clients, the U.S. attorney for the Southern District of New York announced Wednesday.
After a five-week trial, the jury convicted Darryl Cohen, 52, of Chatsworth, California, of one count of wire fraud, which carries a maximum 20-year prison sentence, and one count of investment advisor fraud, which could result in a maximum five years in prison, prosecutors said.
"Financial advisor Darryl Cohen built trust with successful pro athletes — then betrayed it, stealing their money to fund personal luxuries, including a state-of-the-art gym in his own backyard," U.S. Attorney Jay Clayton said. "New Yorkers deserve honest financial advice — not advisors who scheme to steal clients' funds, rather than protect their financial interests — and this office is committed to removing bad actors from our markets."
Citing charging documents, public court proceedings, trial evidence and statements made in public filings, Clayton's office said that Cohen orchestrated a scheme roughly from 2017 through 2020 to defraud athlete-clients Chandler Parsons, Courtney Lee and Jrue Holiday of more than $5 million combined by taking advantage of his advisory and fiduciary relationships with them.
Cohen was dually registered as a broker and investment advisor.
Cohen, now barred from the financial services industry, and an accountant, Brian Gilder, fraudulently induced the three athletes to purchase viatical life insurance policies at massive markups, according to Clayton's office. He didn't disclose that Gilder had arranged for a law firm he controlled to buy the policies and then to sell them to the players at markups of 222%, 310% and 244%, respectively, prosecutors said.
The law firm made about $4.5 million in profit from selling the policies to the athlete-clients, and Cohen and Gilder used a substantial portion of the proceeds to pay their own personal expenses, Clayton's office said. Cohen used over $178,400 to renovate his home and perform work on his pool; about $67,500 to pay off his personal credit card bill; and transferred $200,000 to a romantic partner, prosecutors said.
Cohen also directed that $500,000 be transferred from Parsons and Lee's accounts as purported donations to a nonprofit organization, Beast Basketball, but used about $238,000 of the supposed donation to build a state-of-the-art gym in his backyard, Clayton's office said, adding that Parsons and Lee never authorized any fund transfers to Beast Basketball.
When Parsons confronted Cohen about the donations, the advisor replied in a text message that Parsons' money had helped many future prospects and underprivileged children, but didn't disclose that he had used funds to build the gym, according to prosecutors.
Cohen also used a sports agency and another law firm to channel over $328,000 of Parsons' money, without authorization, to repay Nyjer Morgan, a former Major League Baseball player, who had expressed concern about investments and loans that Cohen made on his behalf and demanded repayment, Clayton's office said.
In February 2020, Cohen messaged Gilder that they had to send money to Morgan to get rid of him, according to the office.
A parallel civil case that the Securities and Exchange Commission filed against Cohen was stayed pending the criminal trial's outcome.
Gilder pleaded guilty in October 2023 to one count of conspiracy to commit wire fraud. In January 2024, the court sentenced him to time served and three years of supervised release, and he paid restitution and forfeiture amounts before his sentencing hearing, online records show. The court dismissed other charges against him, and early last year, the judge approved his application for early termination of the supervised release, they show.
Portland Trail Blazers guard Jrue Holiday. Credit: Jenny Kane/AP Photo
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