WASHINGTON (AP) The NFL Players Association on Wednesday suspended the registration of a financial adviser accused of cheating several professional athletes, including Denver Broncos quarterback Mark Sanchez, out of millions of dollars in a Ponzi-like scheme.
The move comes a day after the Securities and Exchange Commission announced that it had obtained a court order freezing the assets of Ash Narayan, who previously was approved to advise NFL players on investments.
The SEC alleges in a federal lawsuit filed last month in Dallas that Narayan secretly siphoned millions of dollars from accounts he managed for professional athletes and invested them in a struggling online sports and entertainment ticket business on whose board he served. No criminal charges have been filed.
San Francisco Giants pitcher Jake Peavy and retired Houston Astros pitcher Roy Oswalt were among the athletes who investigators say were cheated out of more than $30 million. The NFLPA said it was not yet aware if Sanchez was the lone NFL player involved.
Narayan told his clients he was pursuing a low-risk investment strategy for their money but actually put more than $33 million of it into an Illinois-based online sports and entertainment ticket business, The Ticket Reserve, that had lost money for the last four years, according to the SEC. Its lawsuit also says he didn't tell them that The Ticket Reserve paid him nearly $2 million in finder's fees for directing the athletes' money to the company.
The lawsuit alleges that Narayan, The Ticket Reserve, the ticket company's CEO and its chief operating officer violated antifraud provisions of federal securities laws and a related SEC antifraud rule, and accuses Narayan of violating the antifraud provisions of the Investment Advisers Act of 1940.
''Mr. Narayan has always sought to act in his clients' best interests. Accordingly, he will continue to work with the SEC to ensure that this matter is resolved in the most favorable manner for those clients,'' Howard M. Privette, Narayan's attorney, said in an email.
According to court documents, Narayan directed more than $30.4 million into the ticket business from three current and former athletes: $15.1 million from Peavy; nearly $7.8 million from Sanchez; and nearly $7.6 million from Oswalt.
In statements filed as part of the lawsuit, both Sanchez and Peavy said they believe Narayan forged their signatures to transfer money from their accounts to the business.
Narayan worked out of Irvine, California, for a Dallas-based financial firm, RGT Wealth Advisors, from 1997 until earlier this year. In a statement, RGT said it fired Narayan after discovering what he had done.