July 10, 2015 / 12:38 AM / 4 years ago

Financial adviser, race car driver convicted for defrauding NHL players

NEW YORK (Reuters) - A financial adviser and a retired professional race car driver were found guilty Thursday of defrauding several National Hockey League players and others out of millions of dollars through a series of real estate and business deals.

Phillip Kenner, a financial adviser from Arizona, and Tommy Constantine, who founded the Playboy Racing Team, were convicted by a federal jury in Central Islip, New York, on charges including wire fraud and money laundering conspiracy.

The verdict followed a 10-week trial in a case that featured testimony by Kenner’s athlete clients along with others whom authorities said were victimized in a scheme that enabled the two men to reap $30 million.

“Today, their scheme has been brought to an end,” Acting U.S. Attorney Kelly Currie said in announcing the verdict.

Lawyers for Kenner and Constantine did not respond to requests for comment.

Prosecutors said Kenner, 46, made his connections to the NHL players through a college friend who was drafted to the league.

From 2002 to 2013, Kenner persuaded at least 13 players to invest $100,000 each in a Hawaiian real estate development, only to steal the money with his undisclosed partner, Constantine, 48, causing losses of $13 million, prosecutors said.

In another scheme, authorities said Kenner and Constantine in 2008 and 2009 teamed up to convince many of the same NHL clients to invest $1.4 million in Constantine’s prepaid debit card business, Eufora.

The money was instead was diverted to bank accounts Kenner and Constantine controlled, prosecutors said.

When that scheme began collapsing, Kenner and Constantine engineered a new fraud, telling the players their losses were due to a Mexican real estate developer not paying back an undisclosed loan, prosecutors said.

The men convinced the players to give them $4.1 million to sue over the losses, only to use a small amount of the money for the litigation, prosecutors said.

Kenner used the victims’ money to pay for a mortgage on a mullion-dollar home in Arizona, a beach-front property in California, and Mexican tequila company, prosecutors said.

Constantine, meanwhile, used the money “to put up a show as a race car driver, to buy cars, get them upgraded, fly around to races and hire playboy models to come to those races with him,” Saritha Komatireddy, a prosecutor, told jurors.

The case is U.S. v. Kenner, U.S. District Court, Eastern District of New York, No. 13-cr-607.

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