A financial advisor and a race-car driver were convicted of stealing at least $30 million from professional hockey players and others to buy land in Hawaii and a tequila factory in Mexico, among other things, according to the U.S. Attorney for the Eastern District of New York.
Following 10 weeks of trial, a Federal District Court jury in Central Islip, N.Y., convicted advisor Phillip A. Kenner, 46, and part-time race-car driver Tommy C. Constantine, 48, on charges of wire fraud, wire fraud conspiracy and money laundering conspiracy on Thursday. Kenner is not registered with either the SEC or Finra.
The two men, both from Scottsdale, Ariz., pocketed millions of dollars raised from Long Island businessmen and professional athletes, supposedly to develop land in Hawaii and pay for a start-up credit card business based in Arizona, said Kelly T. Currie, acting U.S. attorney for the Eastern District of New York.
As early as 2004, Kenner and Constantine used a labyrinth of holding companies to siphon millions in investor dollars into companies, real estate and other ventures that solely benefitted the defendants, Currie said.
“Driven by personal greed, Kenner and Constantine spent years lying to investors and stealing their money, and then attempted to conceal their fraud by repeatedly and brazenly avoiding responsibility, shifting blame and scapegoating others. Today, their scheme has been brought to an end,” Currie said.
As a college hockey player at Rensselaer Polytechnic Institute in Troy, N.Y., Kenner befriended then-teammate and future Olympian and National Hockey League star Joe Juneau, who testified during the trial that after college he helped introduce Kenner to a number of other NHL players in the 1990's as Kenner began working as a financial advisor in Boston.
Through those early contacts, Kenner developed a clientele that included one-time New York Islanders forward Michael Peca, 1995 first-round draft pick and U.S. Olympian Bryan Berard and Stanley Cup champions Darryl Sydor, Bill Ranford and Sergei Gonchar, among other NHL players, whose careers blossomed just as Kenner took over greater and greater control of their finances and wealth, Currie said.
In addition to taking money for real estate investments, Kenner also had the players open lines of credit, collateralized by their personal stock, bond and savings accounts, worth at least $10 million, Currie said.
Kenner borrowed nearly all of his clients’ lines of credit and used the money to purchase his personal interest in real estate projects in Hawaii and Mexico, transfer funds to his partner Constantine and fund both his and Constantine’s personal expenses, Currie said.
Kenner and Constantine negotiated sweetheart deals that used the players’ assets and diverted millions to the defendants’ various pet projects and land deals, Currie said.