Taking the Charge: DOJ Accuses Director of Attempting to Defraud NBA Players’ Union of $3 million
Carmelo Anthony couldn’t find his way to rim as often as he’d have liked in Game 4 Sunday night against the Celtics. Boston’s defensive sets did well to have post help waiting for Melo when he inevitably blew past defenders. In one frustrating instance, he drove into the lane doggedly, lowered his shoulder into a planted Kevin Garnett and was called for charging.
In basketball, “charging” is an offensive foul committed when a ball handler bundles into a stationary defender. Smart players on defense can cut off driving lanes by planting themselves in the way of attackers looking for lay-ups and dunks. In essence, taking a charge is a defensive strategy that, when successful, takes advantage of an onrushing offensive player. It’s a maneuver, or lack of one rather, that changes possession and momentum: after a charge is called, defense becomes offense.
Joseph Lombardo, director of an investment firm that handles finances for the NBA players’ union, has taken a charge, so to speak, but on a different court. The Manhattan District Attorney’s Office charged Lombardo April 25 with attempted wire fraud, attempted mail fraud and obstruction of justice. Lombardo is scheduled to appear in federal court May 2.
For any team in the NBA playoffs, the stakes are set: win or go home. However, the losers don’t lose anything but pride and some bonuses. At the end of the day, the losers will get a massage, drive home in a Porsche and go to bed in a mansion.
For a defendant at trial, it’s either win or go to jail.
Mr. Lombardo is founder and director of Prim Capital Corporation, the primary firm handling assets for the National Basketball Players Association (NBPA). Investigations conducted by the Office of Labor Racketeering and Fraud Investigations, which works under the Department of Labor’s Office of the Inspector General (DOL-OIG), alleges that Mr. Lombardo forged a signature to create a contract worth over $3 million to be paid out over five years.
The criminal complaint argues that Mr. Lombardo had a stamp made recreating the signature of Gary Hall, former NBPA General Counsel, after his death in 2011. In 2005, Hall had signed a contract with Prim stating Prim would be paid $350,000 a year.
When Prim discovered that a legal review of NBPA would be made public, Prim allegedly produced and submitted a forged contract stating the NBPA agreed to pay $602,000 a year.
Furthermore, when the case was brought to a federal grand jury trial, Lombardo allegedly instructed various witness to state false information. “It’s important that we didn’t doctor this document up, okay?” he said in a recorded conversation.
Mr. Lombardo was issued a subpoena on May 16, 2012 but he allegedly did not respond to the subpoena with the contract agreeing to pay $602,000 a year. When Mr. Lombardo submitted the contract in question in January 2013, investigators became curious and suspected the document may have been altered.
Mr. Lombardo stated, according to the criminal complaint, that he and Mr. Hall never corresponded via email or fax. Mr. Lombardo stated that Mr. Hall instructed him to pick up a new contract worth $602,000 a year from his New York office.
Mr. Lombardo testified that Mr. Hall told to him, “If I’m there, I’ll give it to you. If I’m not, go into my office and get it, there’s an envelope there with your name on it.”
If convicted, Mr. Lombardo faces a maximum sentence of 20 years and a fine of $250,000 for each count of mail fraud, wire fraud and obstruction of justice.