Kevin Garnett’s suit alleges accountant helped wealth manager steal $77M of NBA star’s money
Former Timberwolves star Kevin Garnett is suing an accountant and his firm, claiming they helped a now-imprisoned wealth manager steal tens of millions of dollars of the retired athletes money.
The federal malpractice lawsuit alleges that Kentucky-based accountant Michael Wertheim and Welenken CPAs knowingly enabled Charles A. Banks IV in defrauding Garnett out of $77 million over several years through businesses in which Garnett and Banks shared an interest.
Wertheim possessed actual knowledge that Banks was helping himself to millions of dollars of Garnetts money and did nothing about it, according to the suit, which was initially filed in Hennepin County District Court and moved Wednesday to U.S. District Court in Minneapolis.
Banks intentionally ... looted Garnett of his earnings and assets for many years, including the many years that Welenken and Wertheim provided accounting services to Garnett and his business interests.
Defense attorney Greg Simpson said his client will vigorously fight the suit and denies the allegations.
Garnetts attorney, Mark Gaughan, declined to say why Banks was not named as a defendant and would only say that based upon the facts, we are confident this matter ultimately will be resolved in Mr. Garnetts favor.
Zeroing in on Wertheims alleged misdeeds, the suit points out that he took direction from Banks and for some reason chose to have virtually no contact with Garnett.
The suit said Wertheim prepared financial statements, was a registered agent for companies in which Garnett held a financial interest, and added his name to bank accounts holding Garnetts money.
Garnett on allowance
Wertheim also worked in concert with Banks to put Garnett on an allowance and set budgets that the 15-time NBA all-star was urged to follow, the suit read.
In one instance, Garnett asked in August 2013 to receive $40,000 of his own money, but Banks cited Wertheim in balking at the request, according to the suit.
Kevin, I have all the info from the accountant and suggested (and required cuts), according to correspondence from Banks to Garnett that is part of the suit. This e-mail is just meant to convey the cold, hard facts, no opinion or judgement. Its pretty ugly and going to be very difficult, but you can do it and it will change your life forever (financially).
In and around that time, the suit noted, Banks took more than $2 million for himself.
The e-mail implying that Garnett was in some financial difficulty came three years before he retired in 2016 as the NBAs all-time leading salary earner at $326 million, according to Business Insider.
In June 2017, Banks was sentenced to four years in federal prison and ordered to make $7.5 million in restitution after admitting to defrauding another recently retired NBA star, San Antonios Tim Duncan, out of millions of dollars. In one of Duncans deals with Banks, the former San Antonio Spur said he was told Garnett would be a partner.
Two months after the onetime winery executive was sentenced, the siphoning of Garnetts money ended once the former Timberwolfs legal counsel gained access to the accounting firms records, according to the suit.
The suit points to one Banks-Garnett venture as a prime example of how the Atlanta businessman stole from his partner:
California-based Hammer Holdings made investments chosen by Banks under the supposed arrangement that Garnett and Banks each held a 50-50 interest. However, Garnett learned that Banks helped himself to millions of dollars of Hammers funds, even though Garnett put in $57 million at Banks direction while Banks contributed about $2.5 million.
Wertheim was also fully aware that Banks moved $14.8 million of Garnetts personal money into Hammer, and that Banks then borrowed nearly $8 million of that and took another $3 million in two other transactions.
About six weeks before Garnett initially filed his suit in Hennepin County, he petitioned for divorce from his wife, Brandi. Garnett cited an irretrievable breakdown in his 14-year-long marriage.
The filing notes that the terms of a prenuptial agreement would dictate how their assets would be divided. The petition does not reveal how assets would be divided in a divorce.
The Garnetts have two children, ages 10 and 5, and there would be a joint custody arrangement, according to the filing.
Brandi Garnett has asked the court to suspend divorce proceedings in Minnesota Kevin Garnett maintains a home in Orono and has filed her own petition for divorce in her home state of California. A final determination is pending.
The Timberwolves chose Garnett out of high school in the first round of the 1995 draft. He was traded to Boston ahead of the 2007-08 campaign, and he was on the Celtics NBA championship team that same season.
He played for the Brooklyn Nets starting in 2013 until rejoining the Timberwolves late in February 2015. He retired as a Timberwolf in 2016.
Paul Walsh 612-673-4482