Former financial adviser for Tim Duncan faces criminal, civil charges

Charles Banks indicted on wire fraud charges; SEC alleges fraud

By Garrett Brnger - Reporter, Ben Spicer - Web Producer

SAN ANTONIO - A former financial adviser for retired Spurs great Tim Duncan faces criminal and civil charges for defrauding Duncan out of millions of dollars, authorities said.

Charles Banks appeared Friday in a federal courtroom in San Antonio, where the indictment on two wire fraud charges was unsealed. The Securities and Exchange Commission has also filed a lawsuit in federal court in Atlanta accusing Banks of five separate counts of fraud.

The cases revolve around allegations of a scheme to defraud Duncan by getting him to guarantee a $6 million line of credit for a company Banks was part of by misrepresenting the terms and the consequences.

Each wire fraud count carries a maximum penalty of 20 years in federal prison. If he's found liable for the civil fraud allegations leveled by the SEC, Banks could have to pay back any "ill-gotten" money, pay penalties and even be permanently barred from the profession.

An attorney for Duncan, who is also suing Banks, said the federal charges were a vindication of Duncan's claims.

"The purpose was always to prevent Mr. Banks from doing this to anyone else," Michael Bernard said. "Today, the Department of Justice has stepped in to make that a reality."

Duncan echoed that in a statement reported by Yahoo Sports in which he says, "I originally filed my lawsuits against Charles Banks to stop him from doing to others what he had done to me and my family. The U.S. Department of Justice has taken a big step in exposing and stopping his illegal activities. I thank the U.S. Attorney's office and FBI for working tirelessly to bring Banks to justice."

Banks' attorney, John Murphy, said his client is innocent.

"We're confident when all the facts and circumstances come to light, everyone will see that there's another side, or multiple sides, to this story, and that he's innocent of any criminal wrongdoing," Murphy said,

According to the indictment and the SEC lawsuit, Banks got Duncan to loan $7.5 million in 2012 to Gameday Merchandising, a company of which Banks was the board chairman.

In 2013, Banks got Duncan to guarantee a separate, $6 million line of credit for Gameday and agree to go further back in the company's line of creditors, authorities said.

However, prosecutors said Banks told Duncan that it was a modification of the first loan.

In a June 4, 2013, text message conversation with Duncan released in the indictment, Banks tells the basketball star he's changing his original loan from $7.5 million to $6 million, effectively reducing his exposure by $1.5 million.

Instead, prosecutors said Banks was lying in his description of the transaction and its effect. They claim what he was really doing was increasing Duncan's contingent liability by $6 million as well as getting Duncan to move further back in the line of creditors for the company.

Duncan sued Banks in 2015, accusing him of making personal gains off his investments, while Duncan saw nothing in return. Court records and documents show that Banks had ownership stakes or financial interests in the investments.

Duncan also claimed that Banks used his signature to sign off on loans without his knowledge.

The report said Banks has also been tied to Minnesota Timberwolves All-Star Kevin Garnett as a financial adviser.

Over the course of his 19-year playing career, Duncan earned an estimated $240 million in salary.

Securities and Exchange Commission Complaint 

Charles Banks Indictment 

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