In the fall of 2007, when
In fact, the Whites learned, at least five other MLB clients of Hill and his partner,
The Whites ultimately decided to invest in November 2007.
But according to a lawsuit filed today in federal district court in New Jersey, what the six ballplayers had unknowingly wandered into was an alleged multi-million-dollar securities fraud and real estate scam.
The complaint, filed on behalf of White and Floyd against Hill and Kolinsky, alleges federal securities fraud and misrepresentation, breach of fiduciary duty, and civil conspiracy to defraud, among other claims. It also alleges that the $2.25 million in total investment by White ($1 million) and Floyd (who put in $1.25 million) is now valueless and lost, and further requests $12.25 million in compensatory, punitive and exemplary damages. Four other alleged co-conspirators involved in the management of the property are also named as defendants in the suit.
SI.com has learned that the New Jersey Office of the Attorney General is also investigating the case.
Messages left for Hill and Kolinsky at their respective office numbers were not returned this afternoon.
"The defendants were negligent and careless at minimum, and intentional at worst, in saying that they could develop this property and make a profit," says
Wright, Hundley, Jeffries and Marquis -- who have yet to press charges -- are believed to have each contributed between $250,000 and $500,000.
The lawsuit claims that Hill, who had served as White and Floyd's financial adviser for some 15 years, had allegedly "guaranteed that the Whites would not only get all of their money back quickly, but would make a substantial profit on their investment," based on the notion that a buyer for the distressed property -- priced at $14.485 million, but supposedly appraised at $18 million -- had already been secured.
But when White and Floyd both began to inquire about the status of the deal at various points over the following three years, Hill, they say, would become "markedly evasive" about the details, finally prompting them to contact an attorney this spring. White and Floyd claim that the first documentation for the deal of any kind was shown to them in March 2010, over two years after their investment.
"The crazy part is, [Hill] started to act like he was our brother," says Floyd, adding that the vast majority of his finances had previously been kept in small-risk, conservative annuities. "He started to say stuff like, 'I love you, man,' 'I'd never cheat you out of anything,' 'Everything is going to be fine.' I could go on. I'm always wary of those people, but he played a good role. He knew we trusted him 100 percent. Not 94 percent, not 95 percent, but 100 percent."
Despite the guarantees, the players have seen no financial returns of any kind on the deal.
All six ballplayers involved are or were represented by New York-based agents
"We are assisting and helping with the investigation being conducted by the Attorney General's Office of New Jersey," Seth Levinson says. "We have no doubt that if any illegalities exist, they will be uncovered and exposed, and that it would be premature and probably improper to make further statements at this time. Rest assured, all the players will do what they believe is in their best interests."