Another lawsuit involving Jeff Rubin is getting ready to hit the courts in South Florida. In the suit attorney Chase Carlson who is representing NFL All Star Terrell Owens, claims that NFL agent Drew Rosenhaus and his brother Jason Rosenhaus, had an improper referral relationship with Jeff Rubin of the now defunct Pro Sports Financial. As a result of the Rosenhaus’s referral relationship with Rubin, Owens lost nearly $5 million dollars of his net worth due to Rubin’s theft and financial mismanagement. Rosenhaus could be liable due to his fiduciary duty to Owens, and the fact that referral relationships between advisers is strictly prohibited by the NFL.
As most of our readers already know, Jeff Rubin was a South Florida financial planner to NFL Players, who is now at the center of multiple criminal investigations and civil lawsuits. Owen’s was one of Rubin’s former clients, after Rosenhaus suggested Rubin to him and gave him his personal stamp of approval as a financial manager. At the time Rubin had already been accused of multiple financial improprieties, including rerouting game checks into different players accounts. In the suit, attorney Carlson of Carlson & Lewittes, describes how Rubin and Rosenhaus had an unwritten agreement, to refer players to one another for the mutual benefit of their respective companies.
The suit also puts even more information on the record of how Rubin stole money from his clients and forged their signatures on investment documents. Which has to beg the question at this point, of how many crimes have to be put on the record before Fort Lauderdale Police arrest Jeff Rubin? We have already documented multiple claims of forgery and out right theft by Rubin, whose company Pro Sports Financial, was based right here in Fort Lauderdale.
Below are some highlights from the lawsuit against Drew Rosenhaus and his brother Jason Rosenhaus.
1. Defendants breached their common law fiduciary duties owing to Owens and engaged in negligent conduct by steering Owens to hire an incompetent and unethical financial adviser with whom the Defendants had a close reciprocal business relationship. Defendants knew or at least should have known that the financial advisor they hand chose for Owens was unethical and lacked the skill, education, training and experience to provide sound financial guidance for a high net worth individual, let alone a professional athlete with a limited number of years left in his playing career. Defendants put their own financial interests ahead of Owens’ interests and recommended that Owens hire Jeffrey Brett Rubin (“Rubin”) as his financial advisor.
2. Owens was one of the NFL players that Rubin put into the casino deal. Rubin also put Owens into several other investments, sometimes forging Owens’ signature to purchase the investment. Rubin made these investments for the purpose of generating over-sized commissions for himself, without regard for the best interests of Owens and without regard to whether the proposed investment was sound financially. Rubin also stole money from Owens’ account. As a result, Owens lost close to $5,000,000 through investments and other defalcations by Rubin.
3. At the time Owens engaged Defendants in 2005, the Defendants had a close financial relationship with Jeffrey Brett Rubin and Rubin’s firm, Pro Sports Financial, Inc. (“Pro Sports Financial”). Pro Sports Financial advertised that it delivered financial “concierge” services for professional athletes, meaning investment advice, financial planning, cash management, bill-paying, and tax return preparation services for clients. Rubin was newly registered as a securities salesperson with the National Association of Securities Dealers (which later became FINRA) and the State of Florida
4. Although Defendants Drew Rosenhaus and Jason Rosenhaus knew Rubin (a) was a neophyte financial planner, (b) lacked the skill, education and experience possessed by accomplished investment advisers employed by large full-service investment firms such as Goldman Sachs, Morgan Stanley, Wells Fargo, Merrill Lynch, and J.P. Morgan, and (c) was unethical or at least had engaged in highly questionable behavior, Defendants nonetheless referred Owens and other professional athletes to Rubin because Rubin referred clients to Defendants. At one point in time, roughly two-thirds of Pro Sports Financial’s clients were clients of Defendants.
5. Owens had never heard of Rubin or Pro Sports Financial and had no idea who Rubin or Pro Sports Financial were until the Defendants brought Rubin unannounced and uninvited to a meeting in Atlanta and introduced Rubin to Owens. At that meeting, Defendants Drew Rosenhaus and Jason Rosenhaus had Rubin make a presentation to Owens on the comprehensive financial services that Rubin and Pro Sports Financial would provide to Owens. At the conclusion of Rubin’s presentation, Defendants made it clear to Owens that he should hire Rubin and Pro Sports Financial for all his financial services, including investment advice, financial planning, cash management, bill-paying and tax return preparation. At that meeting, Defendants Drew Rosenhaus and Jason Rosenhaus vouched for the expertise, skill, honesty and integrity of Rubin and made an explicit recommendation to Owens that he hire Rubin and Pro Sports Financial to provide those services. Based on the recommendation of Defendants and based on the trust Owens held in Defendants, Owens hired Rubin and Pro Sports Financial to provide him with comprehensive financial services, including investment advice, financial planning, cash management, bill-paying, and tax preparation.
6. The reason that Defendants steered Owens and other professional athletes to Rubin and Pro Sports Financial was because Defendants and Rubin had their mutual, reciprocal referral relationship and not because of Rubin’s merit as a financial advisor or an investment advisor.
7. Defendants recommended Rubin to Owens, a Pro Bowl athlete who had the need for effective financial planning, knowing (a) Rubin was only eight years out of college with a degree in exercise (which provided no preparation for a career in the financial services industry), not in business, finance, or accounting, (b) Rubin had only worked for insurance companies and never worked for a major investment firm, (c) Rubin had no advanced training, certifications or designations in the securities industry, and (d) Rubin’s honesty was highly suspect, having stolen money from Barrett Green and forged the signature of Johnny Rutledge in order to earn a commission of over $100,0000.
8. The Defendants made misrepresentations of material facts when they told Owens that Rubin was honest. These misrepresentations were made by Defendants either (a) knowing it was false, (b) without knowing whether it was true or false, or (c) under circumstances in which they ought to have known of its falsity.
Needles to say this doesn’t look to good for the Rosnehaus’s, who were previously regarded, as two of the predominate agents in the National Football League.
The suit also puts another volume on the official record of how Jeffrey Brett Rubin stole, misappropriated, and invested his clients money with forged documents.
Here are some of the Jeff Rubin highlights from the Owens/Rosenhaus lawsuit.
1. At the time of Defendants’ recommendation in 2005, Rubin was only eight years out of college. Rubin graduated from the University of Florida in 1997 with a Bachelor’s degree in Exercise and Sports Sciences. It took Rubin five years to obtain this degree. The degree in Exercise and Sports Sciences provided Rubin with no background or foundation for a career in the financial services industry.
2. In 1999, Rubin took the Series 63 examination (Uniform Securities Agent State Law Examination) and failed it. In September of 2003 (less than two years before Defendants recommended Rubin to Owens), Rubin took the Series 63 examination again, and failed it again. Rubin finally passed the Series 63 examination in late November of 2003, about a year and a half before Defendants recommended Rubin to Owens.
3. Rubin had no undergraduate or post-graduate education in business or finance. Rubin never studied for or obtained advanced certifications or qualifications such as the CFP, CFA, CFC, or CMFC certifications. Finally, Rubin never worked for a Registered Investment Advisor or any major investment firm specializing in investment advisory or private wealth management.
4. In 2003, Green asked Daniel Martoe (“Martoe”), who at the time was an employee of UBS Financial Services, a major brokerage firm, to analyze the statements of account relating to Green’s financial matters being handled by Rubin and Pro Sports Financial. Martoe found that Rubin had misappropriated two of Green’s game checks (which Rubin apparently deposited into the account of Jevon Kearse) and was generally mismanaging Green’s finances.
5. In September of 2004, Johhny Rutledge, a player in the NFL who had hired Rubin and Pro Sports Financial, made a complaint to Rubin’s employer, Northwestern Mutual, that Rubin had forged Rutledge’s signatures on certain life insurance application forms.
6. It was well known or at least highly suspected that Rubin was using, if not abusing, illegal drugs including cocaine and ecstasy. In 2005, Rubin’s fiancé died of a drug overdose, which Defendants had knowledge of. The autopsy found crack-cocaine, prescription drugs, and alcohol in her system.
7. By July of 2006, it was known to Defendants that Rubin had emotional issues that seriously affected his ability to perform his job, but Defendants never advised Owens of these facts.
8. After Rubin became Owens’ financial advisor, Rubin completely mismanaged Owen’s finances and engaged in securities transactions that were fraudulent, negligent, and in breach of his fiduciary duties to Owens, all with the purpose of (a) generating inordinately high fees and commissions for Rubin and Pro Sports Financial and (b) stealing assets belonging to Owens.
9. Instead, between July of 2006 and July of 2009, Rubin purchased about $4.8 million of illiquid, unregistered, high-risk, unsuitable securities for Owens in the form of private placements that paid huge commissions to Rubin ranging from 2% to 7% of the amount of the investment. Rubin or someone under his control signed Owens’ name on more than one of the subscription agreements relating to these private placements and Owens never saw the private placement memoranda and other documents relating to these investments. In each instance, Rubin failed to conduct an adequate due diligence investigation into the proposed investment and failed to apprise Owens’ of the risks of the investment. In addition, Rubin stole funds from Owens’ bank account and transferred the funds to accounts of NFL players Jevon Kearse and Frank Gore.
That’s a lot of illegal financial behavior for Jeff Rubin to have on official court docs in Broward County. Currently Rubin is jumping between his house in Lighthouse Point that is in foreclosure and an apartment he has rented at Turnberry Place in Las Vegas.
Below you can see the full lawsuit from Carlson & Lewittes on behalf of Terrell Owens against Drew and Jason Rosenhaus.