clock menu more-arrow no yes mobile

Filed under:

Nets parent company cooperating with feds in Carton probe

MR. CHIBBS Opening Night in New York City Photo by Lars Niki/Getty Images for BMG

Billboard reports that Brooklyn Sports & Entertainment, Mikhail Prokhorov’s holding company, is cooperating with federal law enforcement in their probe of Craig Carton, the now disgraced WFAN radio host.

BS&E confirmed they are working with prosecutors: "We are cooperating with the authorities and have no additional comment at this time."

Specifically, Dave Brooks of Billboard reports...

Officials with Brooklyn Sports and Entertainment are cooperating with federal authorities in their Ponzi scheme investigation of WFAN sports broadcaster Craig Carton after learning that building officials unknowingly assisted Carton in the theft of $2 million from a leading hedge fund.

Billboard notes that the Securities and Exchange Commission, which led the probe resulting in Carton’s arrest and indictment last week, hinted at the involvement of Barclays Center in the alleged scam in court papers.

According to the SEC complaint, Carton used his connections with a New York City "Venue Company” to trick hedge fund Brigade Capital Management into handing over $2 million for the purchase of Barbra Streisand and Metallica tickets.

Billboard has learned that the venue company in question is Brooklyn Sports and Entertainment, which operates Barclays Center in Brooklyn and Nassau Coliseum on Long Island. According to the SEC complaint, Carton instructed the hedge fund to wire $2 million to an account controlled by BSE, and then told arena officials the wire transfer was accidentally sent to the wrong account and convinced them to wire the money to a separate ticket brokerage he controlled.

Carton served on the BS&E Advisory Board for several years but on Tuesday, his name disappeared from the company website. The advisory board, according to the site, “fuels the strategy and direction of Barclays Center’s successful programming platforms. The Advisory Board includes more than 30 top sports, entertainment and media executives.”

Brooklyn Sports & Entertainment owns the Nets, Barclays Center, Nassau Coliseum, the Long Island Nets and is renovating both the LIU Paramount Theatre in Brooklyn and Webster Hall in Manhattan.

In addition to serving on the advisory board, Carton has had another more tangible connection to the arena. Barclays Center has been the home of the “Boomer and Carton Kitchen,” a concession stand selling items like the Boom Doggy Dog, the Batchagaloop Burger, and Carton’s Kickin’ Chicken.

However, on Tuesday, Newsday quoted a BS&E spokesperson saying the concession stand's days are done. The reason had nothing to do with the current controversy. The lease was up and a decision had been made not to renew it.

Billboard quotes the complaint as saying the radio host, suspended last week by WFAN, manipulated BS&E as part of a Ponzi scheme.

"The $2 million sent from the Hedge Fund to the Venue Company (BS&E), and then diverted to Tier One Tickets, was not used to purchase tickets to the two agreed-upon Barbra Streisand and Metallica concerts,” SEC attorney Caitlyn M Campbell wrote in a complaint against the long-time New York broadcaster. "In actuality, Carton misappropriated the Hedge Fund’s $2 million: $950,000 was wired to his personal account.” Carton allegedy used those funds to repay previous investors and a number of casinos, while another $1 million was wired to an individual the SEC is referring to as "Associate 1.” The identity of Associate 1 is unknown at this time.

Carton reportedly owed casinos millions of dollars in gambling debts. His lawyer has said he’s an innocent victim “who was deceived, manipulated and used by individuals seeking to gather assets for their own fraudulent schemes.” The individuals were not named.