Horror story involving advisor

[explanade]

Football star Dwight Freeney went to Merrill Lynch's wealth management unit.

Somehow his account got taken over by a senior advisor.

Then she left the company and took his account with her. Not clear if he had the opportunity to say he doesn't want that, he wants to stay with ML. But he seemed to have a level of trust with her.

So her boyfriend comes in and plunders the account and Freeney is estimated to have lost $20 million.

For that the bf gets 5 years and the advisor gets 6 months.

Freeney sued BofA/ML and the first suit gets dismissed.

Turns out the guy in charge of the ML wealth management unit was her ex-husband.

He's re-filed the suit.

https://www.youtube.com/watch?v=DeJZ...ature=youtu.be

[Sittingduck]

Thats what happens when other people take more interest in your assets than you do.

[Bamaman]

Unfortunately so many pro athletes ignore financial advice, cannot control their spending and end up in bankruptcy and smack dab broke after their short careers are over.

It's the norm, not the exception.

[explanade]

Well you don't expect them to be Bogleheads or really devote time to investing.

At least not when they're playing.

But going with a well-known firm, which probably has a lot of clients who aren't athletes or victimized, shouldn't have ended so badly.

Maybe he overpays them for fees but still should have fared okay.

[Texas Proud]

I think the plunder of the account is where the companies should be held liable...

The question will be is did the FA move the account with his permission to a firm she controlled and it has zero assets... and also did not have the proper insurance for a plundered account...


If he agreed, and the investment company is BK, I think he is outta luck... but I still would sue anybody and everybody that ever touch the money...

[6miths]

Wouldn't it be reasonable for the NFLPA to put safeguards in place to prevent this sort of thing or at least ensure a basic level of pension type income to all players.

Basically the NFLPA rep is saying that they don't want to make the hard choices because they would then be liable for an episode such as this.

[frayne]

Sad but no more sad than some FA churning some little old lady's portfolio in order to line his own pockets. I'm not one to suggest more government regulation but the penalties need to be more harsh. These are not victimless crimes.

[frank]

thats why I stay away from fa's. If you don't take care of your finances, someone else will take care of their own with your money.

[marko]

Quote:

Originally Posted by Bamaman Unfortunately so many pro athletes ignore financial advice, cannot control their spending and end up in bankruptcy and smack dab broke after their short careers are over. It's the norm, not the exception.

With $20MM in investable assets I wouldn't say he couldn't control his spending.....

[LARS]

5 years for $20 million. I would imagine there is a not small % of population that would do that trade...


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[harley]

Hopefully he has enough money left to hire a couple of leg breakers for when they get out.

[bclover]

Sorry guys there is a lot more to this story then this you tube video. The fa didn't just go in and "steal" the money. Unfortunately as this video refers to, many of these athletes are going into these deals illiterate and with other issues. I know if this story and he helped this process along


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[bclover]

Did the video mention that Freeman had advisors telling him he couldn't support mansions for his entire family and he refused to listen? You guys are decidedly anti FA so have you done the background on this story?

From what I've been reading Freeman did no due diligence on the people he worked with while there was a few read flags. supposedly he signed a power of attorney allowing this person to remove money any time for him.

like I said, this is a complicated ponzi scheme situation.
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[H2ODude]

Quote:

Originally Posted by bclover Sorry guys there is a lot more to this story then this you tube video. The fa didn't just go in and "steal" the money. Unfortunately as this video refers to, many of these athletes are going into these deals illiterate and with other issues. I know if this story and he helped this process along Sent from my SPH-L710 using Early Retirement Forum mobile app

Illiterate? But they graduated with 4 year college degrees from well known institutions, right?

[bclover]

Quote:

Originally Posted by H2ODude Illiterate? But they graduated with 4 year college degrees from well known institutions, right?

lol. Yeah right.

Not even going to get started on that. My son played football for a major university located in Ohio. He wasn't anywhere near professional caliber so his dad and I made sure that her recognized what his true reasons for being in school were.
His advisors used to hate me because I won't let him graduate with a useless degree in ancient egyptian studies.
I went to the University of Pittsburgh when it was a power house and many an idiot on the football team graduated.

Recent years it's gotten better but not much.

EX NBA player Adonale Foyle wrote a great book on how Pro athletes lose their fortunes and no matter how much folks here hate FA, 95% of them are broke for a hell of a lot of other things than some FA stealing their money.

I'm not defending FA's but neither am I going to blame them on this one.

FULL DISCLOSURE: A good friend of mine is a football agent. the "out of control" ness with new players is mind boggling.

[MichaelB]

This is an interesting discussion. It actually does appear the the financial advisor, Eva Weinberg, was convicted of fraud, along with her BF Michael Stern. She served time and is on parole, he is still serving. Money advisor for Chargers linebacker gets prison | FOX5 San Diego – San Diego news, weather, traffic, sports from KSWB
Not sure what conclusion to draw, as it appears the athlete in this case did turn to a licensed professional employed by the wealth management division of a leading financial institution.

[easysurfer]

Multi millionaires are made every year on NFL draft. Some are more prepared than others to handle such a windfall. As others have mentioned, there's plenty of sharks financial pros wiling to take advantage of assist with the new found wealth.

[marko]

Quote:

Originally Posted by MichaelB Not sure what conclusion to draw, as it appears the athlete in this case did turn to a licensed professional employed by the wealth management division of a leading financial institution.

Right. He did everything right for someone with limited financial insights. It's not as if he went to "a friend of a friend"; he went to ML!

Maybe the conclusion is that with that kind of money one must trust no one and keep an eye on everything regardless of what you're being told.

Jessica Simpson was on CNBC last Friday. She had absolutely NO idea where her money was, what it was invested in and trusts her advisor explicitly. It was really scary.

[marko]

Quote:

Originally Posted by easysurfer Multi millionaires are made every year on NFL draft. Some are more prepared than others to handle such a windfall. As others have mentioned, there's plenty of sharks financial pros wiling to take advantage of assist with the new found wealth.

Read somewhere that Rob Gronkowski just socks away his Patriot's pay and lives just on his (substantial just the same) endorsement money. Plus it seems his Dad keep an eye on the money for him as well.

Smart kid.

[AllDone]

Quote:

Originally Posted by bclover Did the video mention that Freeman had advisors telling him he couldn't support mansions for his entire family and he refused to listen? You guys are decidedly anti FA so have you done the background on this story?

The guy had $20M in investments and you still think he couldn't afford to buy a few houses with the rest? And I thought that I was negative about owning real estate!