EY Analysis: Professional Athletes Alleged Almost $500 million in Losses as Fraud Targeting Them Continues to Rise

Originally Published by EY.

With massive salaries and lucrative product endorsements and sponsorships, it is no surprise that fraudsters target professional athletes. What is surprising however, is the fraudsters’ success.

According to a new analysis by the EY Forensic & Integrity Services practice, professional athletes alleged $494 million in fraud-related losses from 2004 through 2017. The number and value of known fraud cases have also steadily increased nearly every year for the past decade.

This is a problem across all major sports. Due in part to each professional football team’s roster size, 41% of identified fraud victims were professional football players. Professional basketball players made up 22% of the identified victims, professional baseball players 15%, and professional hockey players another 10%. Professional soccer players and boxers each accounted for 5%. Fraudsters also target groups of athletes that can span across a variety of leagues; of the $494 million in potential fraud targeting athletes, $114 million (23%) related to cases involving athletes from multiple sports.

“Professional athletes’ wealth and profile put them at high risk of being fraud victims,” said Brian Loughman, EY Americas Leader, Forensic & Integrity Services. “Instances of fraud among athletes are likely to be much higher than what our analysis revealed, with many cases never becoming public. Being a victim of fraud not only takes a significant personal toll, but for some professional athletes, can even lead to financial downfall and bankruptcy.”

Falling victim to a scheme

Methods used to target athletes vary, but they are all linked to one common theme: gaining the athlete’s trust either directly or through mutual contacts and leveraging that relationship of trust into the fraudster’s own financial windfall. Common schemes include:

  • Making recommendations based on undisclosed conflicts of interest
  • Posing as financial professionals to dupe athletes out of their money
  • Using access to make unauthorized and overly risky investments
  • Making unauthorized cash withdrawals from athletes’ bank accounts
  • Providing athletes with false or misleading financial information
  • Using athletes’ names and images for endorsement deals and loans without permission

Factors increasing athletes’ risk of becoming fraud targets

As a high-profile individual, an athlete’s estimated worth is well known to the public. Factors that increase athletes’ risk of being targets of fraud include:

  • Shortage of time to manage their own finances
  • Relying on unqualified or inexperienced people because of previously established relationships
  • Misplaced trust in financial advisors, business managers, or even family members
  • Qualified and experienced advisors with unchecked access
  • Exploitation from family and friends

“Because of athletes’ large steady cash flows and limited time to oversee their finances, athletes can easily overlook improper management or theft of their assets,” said Steve Spiegelhalter, Forensic & Integrity Services Principal, Ernst & Young LLP (EY). “To avoid becoming a fraud victim, athletes need to hire reputable, vetted external parties, rather than inexperienced advisors. Athletes should also conduct due diligence on their financial representatives and potential investments in advance, including background and reference checks, interviews, and audits of financial reports. Finally, they should do what we all should do periodically: take a hard look at where their money is, how much is left, and who can control it.”

Click here to view the full report on ey.com or visit https://go.ey.com/2NQNAsd.

Latest News

Trump commission attempts racist whitewashing of history

Trump Commission Attempts Racist Whitewashing of History; Colorado Rep. Lauren Boebert Probed for Potential Role in Capitol Insurrection; and More

Trump commission’s “1776 Report” attempts racist whitewashing of history In the highly controversial “1776 Report” released by the Trump administration yesterday, the outgoing GOP party doesn’t just try to present a nonpartisan, “patriotic” look at the nation’s history (as the President had promised the report would do) it fully rewrites…

Flint, Michigan water plant

Ex-Michigan Governor Charged for Racist Lead Poisoning of Flint Water Supply; COVID-19 Vaccines Not Increasing in Availability; Democrats Plan to Repeal Trump Rules; and More

Former Michigan Governor formally charged for poisoning thousands of predominantly Black Flint citizens with water containing lead. In 2014, when the city of Flint was forced by the state to begin taking its water supply from the Flint river rather than using water from nearby Detroit as it had for…

NYPD under suit

NYPD Sued for Years of Racial Abuse and Use of Excessive Force; Trump Administration Approves Discrimination Against LGBTQ individuals; and More

NYPD sued by Attorney General for years of racial abuse and use of excessive force. In what’s been called a “landmark lawsuit,” The New York Times has reported that New York state Attorney General Letitia James is suing the city of New York, the mayor and the NYPD’s leaders, alleging…

NBCUniversal News Group Launches NBCU Academy, Offering Training to Universities and Community Colleges

NBCUniversal News Group launched NBCU Academy, a new, innovative, multiplatform journalism training and development program for four-year university and community college students through education, on-campus training and online programming. Originally published on corporate.comcast.com. The initiative includes a curated onsite curriculum for hands-on learning experience with world-class NBCU News Group journalists,…


Kaiser Permanente: Committing $8.15M for Racial Equity

Originally published on about.kaiserpermanente.org. Grants to grassroots and nonprofit organizations will help address structural racism and practices that prevent communities of color from achieving good health and well-being. Kaiser Permanente (DiversityInc Hall of Fame), the nation’s largest integrated, nonprofit health system, has awarded $8.15 million to support dozens of nonprofit…

Toyota Research Institute and Stanford University’s Dynamic Design Lab Study How to Improve Automotive Safety

Originally published on pressroom.toyota.com. Inspired by the Skills of Professional Drift Drivers, Research Seeks to Combine the Technology of Vehicle Automation with Artificial Intelligence Algorithms What if every driver who ran into trouble had the instinctive reflexes of a professional race car driver and the calculated foresight of a supercomputer…