Former pro basketball player Kevin Garnett has filed suit against his former accountant for $77 million after he was defrauded by a wealth manager who worked with the CPA.
Garnett sued Michael Wertheim, a partner at Welenken CPAs, a six-person accounting firm in Louisville, Kentucky, accusing the firm of allowing wealth manager Charles Banks IV to swindle the athlete out of the amount. The lawsuit claims the accountant “possessed actual knowledge that Banks was helping himself to millions of dollars of Garnett’s money and did nothing about it,” according to
Banks was sentenced to four years in prison last year in a separate case in which he was accused of stealing at least $7.5 million from another former client.
However, Wertheim’s attorney told Accounting Today that the accountants were not at fault. “My clients intend to vigorously defend themselves against the allegations in the complaint,” said defense counsel Greg Simpson. “They deny any wrongdoing and believe the suit lacks merit. They will be moving to dismiss it at an early stage.”
Wertheim had been Garnett’s accountant since 2010. Banks allegedly convinced Garnett to put money into a limited liability company and would take money out of the LLC. Garnett claims that Wertheim, as his accountant, should have known something was wrong, even though he didn’t participate in or profit from the scheme. The accountant believes he had no duty to ferret out fraud committed by Banks and there was no agreement to do so. The complaint alleges that Garnett turned over his finances to Banks, who was authorized to handle the former Minnesota Timberwolves player’s money. Wertheim was engaged to provide accounting services but never dealt directly with Garnett, only with Banks.
