Billy Gillispie Gave Millions To David Salinas And Ex-Georgia Coach Jim Donnan

The Houston Athletics Foundation, a foundation that provides scholarships for the school’s athletes, may have lost more than $2 million according to a report from the Associated Press.

Fortunately, the majority of the money tied up in the apparent fraudulent bonds was not earmarked to go to athletes -- and that that was will be still be paid, according to the school’s athletic director.

Gillispie split his $3 million investment into separate ones of $1 and $2 to the GLC. Under the terms of the investments, Gillispie was promised 60 and 65 percent interest rates on his annual return. Donnan would find new loans to help cover these high interest rates, but eventually he failed to find new investors.

According to other documents, it appears that current Texas State head coach Dennis Franchione helped recruit Gillispie into investing in GLC, as he received commission fees for this. These documents, handwritten by Donnan, also indicate that several college coaches, ex-NFL players and ESPN analysts invested in this scheme.

Before he committed suicide, AAU Coach and investment advisor David Salinas handled millions of dollars on behalf of multiple college coaches including Billy Gillespie, Lute Olsen, Art Briles and Mark Few.

That list continues to grow as Sports Illustrated uncovers more sports-related names on Salinas’ client list.

A group of college basketball coaches held a meeting in Las Vegas on Sunday that had nothing to do with basketball.

Or, at least, nothing that directly had to do with basketball. All were victims of alleged fraud by David Salinas, a Texas financial planner who invested for many top college coaches - and apparently made off with their money.

The coaches who were hoodwinked by David Salinas — some for hundreds of thousands of dollars — met with lawyers in Las Vegas Sunday at 1 p.m. PT to discuss how to go about getting back the money they lost. Per Andy Katz:

Salinas was under investigation for organizing a multi-million dollar Ponzi scheme in which he bilked millions from dollars for college basketball and football coaches. He committed suicide a week ago in his home.

Salinas, 60, was found dead of a self-inflicted gunshot wound on Sunday. At the time of his death, Salinas was reportedly under investigation by the United States Securities and Exchange Commission for a series of failed investments on behalf of his clients, which included several high-profile college coaches.

“After our initial internal review, we have not discovered any compliance issues related to David Salinas and his AAU Houston Select program,” UH athletic director Mack Rhoades said in a statement. “ Our hearts go out to those people affected by the happenings of this past week.”

In a statement released Thursday, Lute Olson said that his investments with David Salinas came after he had retired from coaching. Olson reportedly invested $1.17 million with the Houston AAU coach and investment manager who committed suicide on Sunday. Salinas was under investigation by the Security and Exchange Commission (SEC) for essentially establishing a ponzi scheme that lost millions for investors.

Salinas’ investments have raised the ire of the NCAA due to the nearly $8 million he took from major current and former college basketball head coaches, with many questioning whether coaches also earned undue influence over athletes on Salinas’ AAU squads as part of their investment. Jawann McClellan, a former Wildcat under Olson who played for Salinas as a high schooler has gone on record to say that the relationship between Olson and Salinas was not a factor in his recruitment.

Salinas, an investment adviser who had founded the Houston Select Basketball summer program in 1992, died of an apparent suicide on Sunday. Salinas was the subject of an investigation by the Security and Exchange Commission (SEC) for fraudulent practices that may have cost several college coaches who invested with Salinas millions of dollars.

Olsen reportedly invested $1.17 million with Salinas.

For a solid 25 years now, AAU basketball has been a cesspool for corruption and deceit and conflicts of interest. Even as the NCAA’s taken notice, the problems have gotten worse, not better. Earlier this week, I wrote that “People generally think of AAU hoops as either shameful or hilarious, but it’s definitely both.” There’s no better example than the latest scandal.

First, the tragedy. David Salinas, the manager of the prominent Houston Select AAU team and an investment manager, died from an apparent suicide this weekend. Salinas was 60 years old, and in recent months found himself at the center of an SEC (Securities Exchange... not Mike Slive’s league) investigation into an alleged Ponzi scheme that cost his investors millions. The twist? Many of those investors were major college basketball coaches, all of whom lost millions of dollars investing with Salinas.

There have been conflicting reports about whether the NCAA was interested in the case of David Salinas, a Houston AAU program founder who apparently committed suicide after running a Ponzi scheme that involved a number of college basketball coaches. But now Sports Illustrated reporter Pablo Torre is adamant about the NCAA’s interest:

Just wanted to add: yes, NCAA has been asking all types of people about this case. Official “investigation” is a red herring. They care.That doesn’t sound like an full-fledged NCAA investigation, but certainly something beyond mere passing interest: “investigating,” perhaps, with the rest of the formal investigation to come. And that only makes sense, considering Salinas’ background as an AAU figure and a person who allegedly took millions from coaches. Even if there’s nothing nefarious about Salinas’ work as a manager of coaches’ money beyond incompetence, there’s more than enough smoke for the NCAA to be sniffing around.

Late Tuesday night, ESPN’s Andy Katz cited a source who said that the NCAA did not intend to launch a formal investigation into fraud allegations against David Salinas, a Texas financial planner who was also an AAU coach and benefactor with close financial ties to many top college coaches.

But a Houston television station now reports that the NCAA is looking into Salinas’ relationships with its coaches.

The organization that has become most famous for its investigations recently has decided it doesn’t need to bother with one for this doozie. J. David Salinas, a Houston-based AAU program’s executive, allegedly committed suicide, revealing a failed Ponzi scheme that totaled almost $8 million in coaches’ money.

In other words...what?

David Salinas, while not working as an investment adviser, ran a well-known basketball camp in Houston, but on Sunday he was found dead as a result of a possible suicide, as originally reported by CBSSports.com.

The pieces of the puzzle in determining why he committed suicide are beginning to come together as it seems as though Salinas had run a Ponzi scheme that failed and that much of the investments came from college basketball coaches. SI.com has the full details.

Tom Penders, the former University of Houston men’s basketball coach, said he turned down an offer to invest with David Salinas in 2004 out of fear of violating NCAA rules. Salinas was a financial advisor and former Houston area AAU basketball coach who killed himself last weekend.

Since Salinas’ death, CBSSports.com has discovered that the Securities and Exchange Commission had been investigating Salinas for possibly defrauding several basketball coaches. Penders, who retired in 2010, said the implication was that investing with Salinas would help steer AAU players to Houston. This news could be significant as it would indicate a clear violation of NCAA rules. Salinas’ AAU program sent notable players to such programs as Texas, Arizona and Kansas State.

On Sunday evening, CBSSports.com uncovered several more college basketball coaches who were connected to investment adviser David Salinas, who died of an apparent suicide. Earlier in the day, former Arizona coach Lute Olson and current Texas Tech coach Billy Gillispie were identified among the initial group of coaches who had invested with Salinas. New coaches to emerge in this investigation include Nebraska’s Doc Sadler and U.S. Merchant Marine Academy coach Danny Nee.

However, this list is likely to grow, though a CBSSports.com source believes many coaches will try to disavow any connection with Salinas. One of the coaches involved did speak with CBSSports.com on Sunday night under the condition of anonymity and said:

David Salinas, while not working as an investment adviser, ran a well-known basketball camp in Houston, but on Sunday he was found dead as a result of a possible suicide, reports CBSSports.com. It is possible his suicide is related to the recent investigation the U.S. Securities and Exchange Commission started concerning possible fraud.

According to CBSSports.com’s sources, some of Salinas’ clients were college basketball coaches who lost millions of dollars under his advisement: