South Florida

Miami exec bribed basketball coach to get son into Ivy League school, indictment charges

Jerome Allen, former head basketball coach at the University of Pennsylvania and now an assistant with the Boston Celtics.
Jerome Allen, former head basketball coach at the University of Pennsylvania and now an assistant with the Boston Celtics. AP File

A wealthy Miami Beach businessman at the center of a massive Medicare fraud case has been charged with paying bribes to former University of Pennsylvania basketball head coach Jerome Allen so his son could be accepted as a “recruited” player to the Ivy League college.

In an indictment, Philip Esformes was charged anew on Friday of using proceeds from defrauding the taxpayer-funded Medicare program to pay about $75,000 to Allen, now an assistant with the Boston Celtics, in bank wire transfers, hotel rooms, private jet travel and limo transportation.

The indictment does not identify the university, coach or student-athlete, only that the college is in Philadelphia, Pennsylvania. A Justice Department prosecutor, prompted by a question from a Miami federal judge, disclosed on Friday that the college is Penn, the basketball coach is Allen, and the student is Esformes’ son, Morris. He entered the university in the fall of 2015 but never made its basketball team.

Morris Esformes, Hebrew Academy Class of 2015 Hebrew Academy

It is not clear from the indictment, which expands upon the $1 billion Medicare fraud case that led to Philip Esformes’ arrest two years ago, whether other people may face charges, including Allen. The former Penn player and NBA journeyman resigned as the Penn head basketball coach in 2015 after a series of losing seasons and was hired as an assistant by the Boston Celtics.

Allen could not be reached for comment. Representatives for the University of Pennsylvania and the Celtics declined to comment on Saturday.

According to the indictment, Esformes paid the coach so that he would designate his son as a “recruited basketball player” to support his application to Penn in 2014.

Philip Esformes’ lawyer denied any bribery scheme, saying his client’s son was qualified to get into Penn on his own academic and athletic merits. Defense Attorney Howard Srebnick told the Miami Herald on Friday that Morris Esformes was a standout “A” student and basketball point guard at Hebrew Academy in Miami Beach.

Srebnick, a Penn grad himself, said “[Morris] scored more than 150 points higher on his SAT than I did, and I cannot dribble a basketball with either hand, much less sink a three-point shot.”

He added that Esformes’ son has maintained a nearly 3.6 GPA, made the Dean’s List at Penn in the last semester and plans to graduate from the Wharton School with the class of 2019.

In a June 2015 interview with College Hoops Daily, Morris said he started playing basketball in middle school and his private coach and trainer was Demetrius McDaniels, whose stepbrother is Miami Heat superstar Dwyane Wade. At the time, the aspiring college point guard spoke about why he chose Penn over other Ivy League universities that he wanted to attend.

“I got a lot of looks from Cornell and Columbia, but I chose Penn rather early for a couple of reasons,” Esformes told CHD. “I want to go into business and the Wharton Business School is great. I also had a great relationship with Coach Jerome Allen. I saw how much he loved the school and just fell in love with it over a couple of visits.“

Srebnick said Philip Esformes hired Allen when his son was a sophomore in high school to help him improve his game, “as many parents do when their kids show athletic promise.”

But the indictment accused Esformes of paying a series of bribes to the coach, who is not identified in the indictment, and of tapping Medicare reimbursements to do it.

Esformes arranged for a limousine to pick up the coach at the swank Fontainebleau Hotel on Miami Beach and bring him to the JW Marriott Marquis in downtown Miami to watch his son play to assess his basketball skills in 2013, according to the indictment. Esformes also arranged for the limo to bring the coach to his home on North Bay Road in Miami Beach, where he has a regulation basketball court behind a second home that he owns next door.

Esformes picked up Allen’s tab at the Fontainebleau Hotel, totaling $2,008.72, according to the indictment.

Esformes then paid the coach $53,000 in bribes in three separate wire transfers between July and December in 2014, the indictment said. The healthcare executive made those transfers “through various concealed methods,” such as directing an administrator who worked for him to send the payments through bank accounts that were not in Esformes’ name.

Esformes also paid $19,549.56 for a jet to fly himself, his son and the coach from Philadelphia to Miami in March 2015.

The latest federal charge against Esformes marks the second time that he has been accused of paying bribes.

Esformes, 49, who is being held without bond at the Miami Federal Detention Center, was previously charged with paying a state regulator $100,000 in bribes for tipping him off to on-site inspections and patient complaints at his network of skilled-nursing and assisted-living facilities in South Florida.

Esformes, who once made $10 million in a single year from his healthcare business, has hired a high-priced team of defense lawyers. They are seeking to have the Miami federal indictment thrown out, while accusing prosecutors in the Justice Department and U.S. Attorney’s Office of misconduct during the Medicare fraud investigation.