Coaches involved in a Ponzi Scheme with an AAU coach, NCAA violations to follow?

UPDATE: Moving this post back to the top. The Houston Chronicle got a pretty damning quote from an unnamed college coach:

A former NCAA basketball coach said he was approached by local AAU coach and investment adviser David Salinas for "a significant sum of money" to invest in exchange for steering players from his AAU program.

"He hinted he could steer players my way," the coach told the Chronicle on Monday. "I never got involved with him, period."

This could get ugly.

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A story that is being immensely under-discussed right now is the tragedy coming out of Houston.

We'll just dive right into it -- here are the goods from a CBSSports.com report:

David Salinas, an investment adviser who doubled as the founder of a prominent Houston-area summer basketball program, died of an apparent suicide Sunday, multiple sources have told CBSSports.com. According to a source, the development comes in light of the United States Securities and Exchange Commission (SEC) investigating Salinas for fraudulent practices that might've cost several college basketball coaches who had invested with Salinas millions of dollars.

The details are a bit unclear right now, but what we do know is that a number -- possibly as many as two dozen or more -- college basketball coaches had invested their money with Salinas, and that Salinas is currently under investigation for what appears to be a Ponzi Scheme. In other words, he defrauded his clients out of a lot of money.


While the grim details will make this story interesting to the common fan, the fact of the matter is that this is guaranteed to draw the interest of the NCAA.

Why were college coaches investing their money with an AAU coach? (UPDATE: Salinas was also apparently a booster for Rice and Houston.)

Gary Parrish and Jeff Goodman -- who provided their first example of why, as a duo, they are a terrifying combination for people operating on the wrong side of the NCAA bylaws -- confirmed a list of nine coaches that had invested money with Salinas: former Arizona head coach Lute Olson, former Utah head coach and current Gonzaga assistant coach Ray Giacoletti, Baylor head coach Scott Drew, Texas Tech head coach Billy Gillispie, Nebraska head coach Doc Sadler, Texas A&M-Corpus Christi head coach Willis Wilson, former Houston and Nevada coach Pat Foster, US Merchant Marines head coach Danny Nee, and Augustana head coach Grey Giovanine.

Salinas ran a powerful AAU program -- the Houston Select -- sending a number of players to the high-major level and even the NBA.

But the most interesting names are Jawann McClellan, Demetri Goodson, Henry Dugat, and Alonzo Edwards. McClellan graduated from Arizona in 2008, where Lute Olson was the head coach when he was recruited. Olson had money invested with Salinas. Goodson just left Gonzaga this summer to transfer to Baylor. Both schools -- Giacoletti at Gonzaga and Drew at Baylor -- had coaches with money invested with Salinas. Dugat played for Baylor and was a part of the team that helped the Bears rebuild a program after the scandal in 2003. Edwards originally attended Nebraska, where head coach Doc Sadler was a client of Salinas.

Joseph Jones (Texas A&M), Dexter Pittman (Texas), Toure Murray (Wichita State), and Cartier Martin (Kansas State) are all former members of the Houston Select as well.

(UPDATE: I didn't realize it at first, but Joseph Jones was a member of Billy Gillispie's first recruiting class in 2004 at Texas A&M.)

Right now, the most important thing on the mind of most of these coaches is just how much money they actually lost. If some of what has been said and written is true, than entire retirement-funds are now gone. Regardless of whether or not a coach is committing an NCAA violation with how he decides to invest his money, no one deserves that kind of financial loss.

At some point, however, these coaches are going to have to start worrying about whether or not they are going to be able to hold on to their jobs. This may have been on the up-and-up. The coaches that decided to invest their money with Salinas may have very well have believed they were making a sound financial investment. But the way that it looks -- especially for Olson ad Giacoletti -- will absolutely spawn an NCAA investigation.

Two more things to consider:

- I listened to Parrish give a radio interview with 610 am in Houston, and he provided a quote from what he referred to as a top 15 coach nationally. "I invest my money with billionaires," the coach said, "not AAU coaches." That's telling.

- If you follow college basketball, you've certainly heard of the Pump Brothers. They are the founders of every Pump 'n' Run AAU team around the country and have control over a huge number of prospects. They also run a foundation to fight cancer. That foundation hosts a dinner in early August every year -- right after the end of the live recruiting period -- where coaches attend to spend $1,000 or $2,000 per plate to raise money to fight the disease.

Last year, the NCAA forbade college coaches from attending and donating to this event because a college coach giving thousands of dollars to the founders of an influential AAU program is not something the NCAA likes to see.

Keep an eye on this story. I'm sure Goodman and Parrish are far from finished.