Darryl Cohen
Former Morgan Stanley financial advisor
What the public record shows
Darryl Cohen, a former Morgan Stanley financial advisor, was convicted of one count of wire fraud and one count of investment-adviser fraud for a scheme to defraud professional basketball players. A parallel SEC civil case was stayed pending the criminal trial. This is a criminal conviction — not an allegation.
The scheme
According to the U.S. Attorney’s Office for the Southern District of New York:
- Cohen and an accountant arranged for a law firm to buy viatical life-insurance policies and then resell them to his athlete clients at markups of 222%, 310%, and 244% — the law firm alone pocketed about $4.5 million in profit.
- Three NBA players — reported as Chandler Parsons, Courtney Lee, and Jrue Holiday — were defrauded of roughly $5 million total.
- Cohen exploited the trust of clients who had handed him control of their finances.
Why athletes are prime targets — and so are you
Professional athletes come into large sums quickly and often lean entirely on an advisor. The same dynamic hits anyone with a sudden windfall — an inheritance, a settlement, a business sale. The defenses are identical:
- Understand what you own. A complex product you can’t explain is a place for markups and conflicts to hide.
- Demand fee transparency. A 200%+ markup is only possible when the client never sees the real cost.
- Get an independent second opinion before any large or unusual investment.
Why we rate this 1 / 10 — Avoid
A federal conviction for abusing an advisory relationship with enormous hidden markups.
Bottom line
Convicted. Trusting one advisor completely, with no independent check, is how windfalls disappear — verify costs and get a second set of eyes.
Sources
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