Allen Stanford Baseball Connection: Yankees Outfielder Johnny Damon's Frozen Funds

TAMPA, Fla. — Yankees outfielders Johnny Damon and Xavier Nady are among the investors whose accounts were caught in a freeze by the government of a company affiliated with Robert Allen Stanford.

The pair did not invest directly with Stanford funds but rather have investments with broker dealers whose accounts were with a Stanford company, Scott Boras, the agent for the pair, said Friday. Boras said the personal management wing of his company was monitoring the situation.

"The broker dealers the players have chosen have advised our personal management auditors the players are not in jeopardy of losing money," Boras said. "I understand government agencies are trying to protect the investor. Hopefully, the agencies will distinguish between those investors who are actually invested in Stanford products from investors whose broker dealers used Stanford as a clearing house and are not affected by the potential claims levied by the government.

"I trust government agencies will take quick steps to narrow the affected investor class and restore account access to all others."

The Securities and Exchange Commission this week froze the assets of Stanford International Bank, Stanford Capital Management and Stanford Group Co.

"I can't pay bills right now," Damon was quoted as saying by foxsports.com. "That started on Tuesday. I had to pay a trainer for working out during the offseason. I told him, 'Just hold on for a little bit and hopefully all this stuff gets resolved.'"

"I didn't have money with Stanford, but all my credit card accounts are frozen right now because of that situation," Nady was quoted as saying by foxsports.com. "I'm trying to get an apartment in New York. I can't put a credit card down to hold it."

Boras said that broker-dealers were chosen by the players independently and were not connected to Boras' company.

Comments

[GreenDayJohn]

Johnny Damon is a salt of the earth guy. Co-workers of mine played golf with him a few years back, and they said he was just a great guy. Johnny had to play golf with this group as part of an advertising contract. He tipped all of the caddies at least $100 and brought the beer as well, great stuff. When they got to the 9th tee, it started to thunder and lighting, and rain heavily. Johnny could have packed his bags and gone home, as his obligation was complete. But, instead, he chose to go back to the club house, pay for every one's lunch, and tell war stories...with perfect strangers. Just thought I'd share that story, he is a vert decent and down to earth person.

[Mort]

Would you have said that if he hadn't been showering everyone with money?

[retreadite]

Don't be a hater, Mort.

[GreenDayJohn]

Not at all, I wasn't there...I think the main thing is that he actually showed interest in everyone that was there and spent time getting to know every one..

[Wide Stance]

As a Sox fan, I can say there are few ballplayers as epically ignorant as Damon.

[MsRy]

Did you feel that way when he was in Boston?

[prospectofdeath]

Yes

[Wide Stance]

Sadly, yes. He is dum.ber than a bag of hammers; his interviews were embarrassing. I enjoyed the atmosphere when he was there, but it turned out to have little to do with Damon.

[jaslyn]

and what about the Hannity/Stanford connection?? He was such a braggart, telling people to buy gold from Stanford and tell them Hannity sent you. Hope that loser's squirming now with his financial advice.

[MsRy]

"I didn't have money with Stanford, but all my credit card accounts are frozen right now because of that situation," Nady was quoted as saying by foxsports.com.

What?

I also have no money with Stanford, yet my credit card accounts are NOT frozen right now.

Why are his cards frozen if he has no $$ in this?

[doogiedude]

Welcome to the reality millions of other Americans are living, only they have no funds to be frozen.

[bellabeach]

Good one and by the way these guys are paid way toooo much money to play sports, they are paid a great deal more than teachers, police, nurses, etc....

[MsRy]

They are paid by private entities, not tax dollars.

Teachers and firemen are paid by public dollars.

Don't like the privately financed spectacle that is American pro sports? Don't give it your hard earned $, and don't buy products that advertise on sports.

Don't like the pay of public servants? Get involved in your community/local politics and work to change it.

[HonorJusticeTruth]

Trust a broker? Oh, come on now. It's sort of like one investment firms current ad campaign where you hear the broker telling the client, "don't let your emotions get in the way, think long term. "My experience" with this kind of market is that..." When the fact is that no broker under the age of 95 has ever been involved in a market like this one.

Yes, they probably did make independent decisions, but I'm sure there was a lot of recommendations floating around. If you didn't ask your broker very specific things about where your money was being put, and the history of those places, and what is known about them, then you do have some responsibilty.

Of course, baseball players don't seem to always be the brightest atheletes out there.

[ChaiKat]

Maybe next time they shouldn't put all their eggs in one basket.

[Bobby]

Just borrow some money from Hank Steinbrenner, I mean he just lavishly gave over $400 million dollars to three free agents. He also has a new BILLION dollar stadium to rip off Yankee fans with extravagent prices.

[Gatormouth]

"broker-dealers were chosen by the players independently..."

So, it's not the players fault. Unless, of course, they bought into the propaganda of political parties that promoted "Let the market handle it" and supported the deregulation BS and then supported political candidates who also did. If so, they may legitimately feel that they had been lied to, but this only makes them dupes. I can feel sympathy for a dupe. But if they then continue this support (not admitting even to themselves that they were duped) they are then fools as well as dupes and deserve no sympathy.

[Rich Evans]

It's clear that people here have no idea what actually occurred here. They didn't invest with Stanford, they only used a broker that used his clearing house services.

Investopedia explains Clearing House
Each futures exchange has its own clearing house. All members of an exchange are required to clear their trades through the clearing house at the end of each trading session and to deposit with the clearing house a sum of money (based on clearinghouse margin requirements) sufficient to cover the member's debit balance. For example, if a member broker reports to the clearing house at the end of the day total purchase of 100,000 bushels of May wheat and total sales of 50,000 bushels of May wheat, he would be net long 50,000 bushels of May wheat. Assuming that this is the broker's only position in futures and that the clearing house margin is six cents per bushel, this would mean the broker would be required to have $3,000 on deposit with the clearing house. Because all members are required to clear their trades through the clearing house and must maintain sufficient funds to cover their debit balances, the clearing house is responsible to all members for the fulfillment of the contracts.

So it's more like an indifferent service than anything else. They are so far removed from the actual Stanford that I have a hard time understanding why their assets are being frozen.

[MadHeart]

Crimea river. We all have fiddled while Rome burned, if you think about it.

[deke4]

Don't tell me those over priced ball players heed the advice of snake oil sales people like Hannity and Stanford. I am still waiting to hear what Hannity has to say about what he has always been, a shill.

[Rich Evans]

They didn't. They used a broker that just happen to use Stanford as a clearing house. That's something entirely different. They are pretty far removed from the scandal.

[TattereD 1]

Brats and Beer. Maybe a little extra on the side, nothing else.

[Deadgnome]

Ha. Good.

[KosMax]

Johnny Damon is hard up? delicious. I hope you can't even afford a haircut now you soulless Judas. There's one upside to general economic collapse and rampant fraud; Shadenfraude.