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New scandal hits Yankees franchise

Published: 4:43PM Sunday February 22, 2009 Source: Reuters

Two outfielders on the New York Yankees baseball team have been hurt by scandal that has embroiled Texas billionaire Allen Stanford, according to media reports.

Fox Sports and the New York Post reported that Johnny Damon and Xavier Nady are among investors whose assets were frozen this week after the US Securities and Exchange Commission on Wednesday charged Stanford with an $8 billion securities fraud.

One of Stanford's companies, Stanford Financial Group, sponsors numerous leagues and teams in such sports as cricket, golf, tennis, basketball, polo and sailing.

The 58-year-old tycoon, who has denied any wrongdoing, was served civil papers in Virginia on Friday by FBI agents and has surrendered his passport to U.S. authorities.

The financier's fortune was estimated at US$2.2 billion last year by Forbes magazine. He has donated millions of dollars to U.S. politicians, and has secured endorsements from such sports stars as golfer Vijay Singh and soccer player Michael Owen.

"My money has been frozen for four or five days," Damon told the Post. "Hopefully it won't be much longer.

"I can't pay my bills," he added.

Nady told Fox Sports he also has been affected.

"I have the same (adviser) as Johnny," he said. "He said I didn't have money with Stanford, but all my credit card accounts are frozen right now because of that situation. I'm trying to get an apartment in New York. I can't put a credit card down to hold it."

Damon, 35, is earning US$13 million this season, while Nady, 30, is set to earn US$6.55 million, according to Fox Sports.

Both players are clients of agent Scott Boras, who could not be reached for comment. However, Boras told Fox Sports his clients had no reason to worry.

"Our personal-management auditors have looked into the financial elements of it," Boras said. "None of our clients is in any financial jeopardy."

Another Boras client, Yankees fist baseman Mark Teixeira, told Fox Sports he did not have money with Stanford, while Yankees third baseman Alex Rodriguez, a Boras client, was not available to comment.

The New York Daily News reported New York Mets pitcher Mike Pelfrey, another Boras client, also had his assets frozen due to investments with Stanford.

Damon, Nady and other Boras clients use Personal Management Consultants (PMC), a division of the Scott Boras Corp, to monitor their assets, according to Fox Sports. Boras said PMC does no make actual investments.

Damon and Nady told Fox Sports their financial advisers told them the matter could be resolved within a few days.

Earlier in the week, the New York Post, citing several sources, reported sports, entertainment and media company IMG had previously agreed to steer clients looking for investment advice to Stanford Financial Group in return for a fee. IMG officials denied the quid-pro-quo charges.

"IMG does not give investment advice to our clients ... period," Mark Steinberg, senior vice president and global managing director of IMG Golf, said in a statement. "Our agreement with Stanford is only to provide consulting services in the area of sponsorships and activation in golf.

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