Two ex-MSU stars, Detroiter charged in alleged scheme to defraud NBA's health plan
Eighteen former NBA players, including two-ex Michigan State stars, a former Detroit Piston and one Detroit native, have been charged with defrauding the league's health-benefit plan of about $4 million.
Federal prosecutors from the Southern District of New York made the announcement of the indictment early Thursday morning, saying 16 of 19 defendants had been arrested by FBI offices in nine states across the country Thursday morning.
Among those charged were Shannon Brown and Alan Anderson, who played at Michigan State; Will Bynum, a former Pistons guard; as well as Chris Douglas-Roberts, who played at Detroit Cass Tech and Detroit Northwestern. Douglas-Roberts was one of three who hadn't been arrested as of early Thursday afternoon.
The four men with Michigan ties are accused of defrauding the plan of about $740,000 for supposed chiropractic services.
Prosecutors allege the 18 former NBA players filed fake medical claims for reimbursement, for dental, chiropractic and other treatments, from 2017 through 2020. They allegedly received about $2.5 million of the $3.9 million sought for reimbursement. Nineteen people were charged with conspiracy to commit health care fraud and wire fraud, which carries a penalty of up to 20 years in prison.
According to the indictment, Terrence Williams, the 11th pick in the 2009 NBA Draft, allegedly orchestrated the scheme, and received about $230,000 in kickbacks. Williams also was charged with aggravated identity theft, which carries a punishment of up to two years in prison.
"The defendants' playbook involved fraud and deception," said Audrey Strauss, U.S. attorney for the Southern District of New York. "They will have to answer for their flagrant violations of law."
The U.S. attorney's office and FBI allege that Williams provided fake forms for players to fill out with medical procedures they never received. Anderson also allegedly helped secure fake medical letters.
Prosecutors and the FBI uncovered the fraud with the help of GPS, noting several players weren't in the location of the supposed medical offices at the time of the supposed medical procedures. One example: Smith reported having a dental procedure in Beverly Hills, California, but was playing in Taiwan at that time.
Other fishy reports sent off alarms, including three players who filed claims for having root canals on the same six teeth on the same date in April 2016, and crowns on the same teeth in May 2016.
Investigators also relied on travel records, email and other documents to uncover the alleged scheme.
"These (health care fraud) costs are then passed on to businesses and customers," said Michael Driscoll, assistant director of the FBI and head of the New York field office. "That's a fraud we take very seriously."
The fund provides additional coverage on top of existing coverage for eligible NBA players, former NBA players and their families, and is funded mostly by NBA teams, Strauss said.
The investigation remains ongoing.
“We will cooperate fully with the U.S. Attorney Office in this matter,” the NBA said in a statement.
Lawyers for the four men with Michigan connections could not be located for comment. It was unclear where three of them were arrested, but none of the arrests occurred in Michigan. Emails sent to Anderson and Bynum weren't immediately returned Thursday night. Contact information for Brown and Douglas-Roberts could not be located.
According to the 32-page indictment unsealed Thursday morning, Brown, Bynum, Douglas-Robertson and Anderson were reimbursed for so-called chiropractic services — $320,000 to Brown, $182,000 to Bynum, $117,000 to Douglas-Roberts and $121,000 to Anderson. The health plan's board later reviewed the claims of Brown and Anderson, determined they shouldn't have been paid and ordered repayment.
According to the indictment, Brown and Anderson haven't repaid the money, nor did they appeal the board's decision. The indictment also details a total of $55,000 in alleged kickbacks paid by Brown, Bynum and Anderson to Williams.
Douglas-Roberts gave no kickbacks to Williams, according to the indictment, which allegedly angered Williams enough to send a fake email to Douglas-Roberts, purportedly from a plan administrator, threatening to deny the claim. According to investigators, the email was sent by Williams in order to scare Douglas-Roberts into paying a kickback, hence the aggravated identity-theft charge for Williams.
Brown, 35, an Illinois native, played for Michigan State from 2003-06 and was drafted 25th overall by the Cleveland Cavaliers in 2006. He played professionally until 2018, including for eight NBA teams. Anderson, 38, a Minnesota native, played at Michigan State from 2001-05, and while he went undrafted in 2005, he signed with the Charlotte Bobcats and played for four other NBA teams, retiring in 2018.
Brown helped lead MSU to one Final Four, and Anderson two Final Fours.
Bynum, 38, from Illinois, played for the Pistons from 2008-14, one of three teams during an eight-season NBA career.
Douglas-Roberts, 34, played at Memphis from 2004-08 and was a second-round pick by the New Jersey Nets in 2008. He played for five NBA teams, retiring in 2016.
Brown, Anderson, Bynum and Douglas-Roberts, also referred to as "Supreme Bey" in the indictment, combined to earn more than $46 million in NBA salary.
Others charged: Anthony Allen, Glen Davis, Melvin Ely, Darius Miles, Jamario Moon, Milt Palacio, Ruben Patterson, Eddie Robinson, Sebastian Telfair, C.J Watson, Antoine Wright and Anthony Wroten, as well as Allen's wife, Desiree. Anthony Allen and Robinson also hadn't been arrested as of early Thursday afternoon.