Former NBA player Tate George gets 9 years for running real estate Ponzi scheme
Victims include current NBA players
Tate George, a former basketball star at the University of Connecticut who spent four years in the NBA in the early-mid 90s, will spend the next nine years in prison for “orchestrating” a $2 million real estate Ponzi scheme, the Department of Justice announced last week.
According to the DOJ and U.S. Attorney for the District of New Jersey Paul Fishman, the 47-year-old George, who spent time with both the New Jersey Nets and the Milwaukee Bucks, presented himself to investors as the chief executive officer of The George Group, claiming that his company was managing more than $500 million in assets.
George allegedly told prospective investors, including several current and former professional athletes, that his firm would use their money to fund the George Group’s purchase and development of real estate projects, and personally guaranteed a return on their investments, with interest.
According to documents revealed during George’s trial, George was able to secure more than $2 million in funding between 2005 and 2011, which he deposited into both his own personal bank account and an account for the firm.
But instead fulfilling his promise to investors that the money would be used fund the real estate projects, George allegedly used the money from new investors to pay existing investors in “Ponzi-scheme fashion.
According to the DOJ, George also used his investors’ money to pay for his daughter’s 16th birthday party, extensive renovations on his New Jersey home (that has since been foreclosed), the mortgage on a New Jersey home, the mortgage on a Florida home, taxes to the Internal Revenue Service and traffic tickets.
The DOJ said that George also gave money to family members and friends, and spent $2,905 for a video about himself, a “sizzle reel” for “The Tate Show,” which was made available on YouTube in an attempt to try to land a reality show for Tate.
According to the DOJ, the George Group had virtually no income-generating operations, and instead relied on new investors’ money to pay back previous investors and fund George’s lifestyle.
The Hartford Courant reported that one of George’s victims is former UCONN star Charlie Villaneuva, who currently plays for the Dallas Mavericks.
“Those who perpetrate Ponzi schemes shamelessly trade on relationships with those who trust them,” Fishman said. “In this case, George relied on his sports stardom to attract unwitting investors. His crimes justified today’s lengthy sentence.”
Additionally, the DOJ said that during the sentencing proceeding, prosecutors accused George of presenting the court with fraudulent character witness letters.
George allegedly claimed the letters, which contained “suspicious similarities,” were sent to the court in support of a more lenient sentence, the DOJ said.
But, some of the individuals who purportedly sent the letters signed declarations stating that they did not write the letters nor did they authorize the letters to be sent to the court on their behalf, the DOJ added.
In addition to prison time, George was also sentenced to three years of supervised release, ordered him to $2.55 million in restitution and entered a forfeiture money judgment of $2.55 million.
“By shamelessly cashing in on his celebrity C. Tate George stole $2 million from investors who trusted him as a former NBA athlete,” said Special Agent in Charge Richard Frankel for the FBI’s Newark Division. “George used the money to pay other investors in the Ponzi-style scheme and lined his pockets with the rest, funding extensive renovations on his home, paying for his daughter’s sixteenth birthday party and producing a reality video about himself.”