From mega portfolios to courtroom tears: NBA legend Duncan's ex-advisor headed to prison

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SAN ANTONIO – Former highflying financial advisor Charles Augustus Banks IV was reduced to tears, a plea for mercy and even given a warning not to take his own life before being sentenced to four years in prison for defrauding NBA legend Tim Duncan.

For years, members of Duncan's financial and legal team say they had been trying but failing to get Banks to face up to any portion of the $24 million in losses they say he caused the former San Antonio Spurs power forward.

But in a venue that offered Duncan the appearance of a home court advantage – Federal District Court in San Antonio – they got their wish Wednesday.

"You're going to turn around," U.S. Judge Fred Biery instructed Banks, gesturing to his wife and family, "and you're going to talk to all these people that you have caused pain for, face-to-face, so you have to look at the pain that I have to see, OK? And then you are going to talk to Mr. Duncan, who trusted you."

From where he stood facing the judge, Banks turned to stand before his wife, daughter and other supporters, all of whom sat on benches on his side of the courtroom. He struggled to compose himself as his wife mouthed words of encouragement.

"Thank you all for being there for me," Banks said, after a gasp. "I'm so sorry I let you down."

Turning to Duncan, who wore his ever-quiet expression from the front row, he said, "Tim, I'm sorry that I put you in a bad position. I'm sorry I lied. I'm sorry I abused your trust."

Banks pleaded guilty in April, without a plea deal, to one count of wire fraud for lying to Duncan about a $6 million loan guarantee to a sports merchandising company Banks ran called Gameday Entertainment. In addition to a prison term and probation, the court ordered Banks to pay Duncan $7.5 million in restitution for a previous loan to Gameday, which is in the process of being dissolved.

Banks had also persuaded Duncan to invest in his winemaking ventures. One of his companies, Terroir Life, owns wineries around the world, including well-known brands like Qupé and Wind Gap. The fallout from his legal struggles has landed Banks in disputes with some of his partners in the wine world, as well. Duncan also has civil suits pending against Banks over other investments.

On the first day of the sentencing hearing, Biery gave Banks a verbal beating. The judge expressed displeasure with many of the 100 people – including Banks' mother – who wrote him letters asking for leniency for Banks, while also suggesting he'd done nothing wrong. The next day, Biery said he'd received additional letters, which apparently struck a better tone. The judge indicated that he'd been moved by accounts of Banks' charity.

"It's very easy to give to charity when you are using other peoples' money," Assistant U.S. Attorney Gregory Surovic argued in response.

During Banks’ courtroom comments, when he spoke directly to Biery, he stopped to compose himself several times while explaining how the case has impacted him.

"Regrettably, I can't repair the damage done to my family," the former advisor said. "My two younger children have felt shame and experienced negative peer pressure, so much so that we decided to move them to a new school." He will not be able to work as an advisor again, nor own or operate wineries, due to prohibitions against felons holding such positions, he said.

"This is all because of me and my actions," he said. "I truly regret what I have done."

If Banks begins his prison sentence Aug. 28, as Biery ordered, he would spend his 50th birthday behind bars.

Even if Banks were to win an appeal, he could still end up serving the full four years, lawyers from both sides said.

"I think the appeal is going no place," J. Tullos Wells, Duncan's lawyer and general counsel for the Spurs, said after the sentencing, "The court delivered a just decision."

As Banks considers his next step, Murphy said he would explain to him and his wife what could happen even if they win on appeal.

"The appellate court, if they accept our argument, could remand the case to Judge Biery to re-sentence," Murphy said. "They would probably ask the judge to recalculate the guidelines and [Biery] could say, 'I've recalculated the guidelines and I still think 48 months is appropriate.' "

Wendy Kowalk, Duncan's financial consultant who first uncovered evidence of Banks' fraud in 2013 while helping him prepare for a divorce, seemed unmoved by Banks' courtroom expressions of remorse. As she has for years, she says she is still fighting to obtain records pertaining to the status of Duncan's many investments with Banks, to little avail.

"If Charles would have ever stopped and said, 'I'm sorry I screwed up,’ and ‘Let me make this right,' and actually started to make it right, Tim would have been patient to the end of time," Kowalik said. "But Charles didn't have any desire to make it right."

In a 2015 interview with Financial Planning, Banks angrily defended himself and called Duncan's accusations "naïve and immature and total nonsense."

After sentencing Banks, Biery said that some people, when faced with prison time, end up taking their own lives because "they just can't deal with it."

"You seem to be a man of strong faith," he continued, "but, please, can you promise your family you won't do anything to harm yourself?"

Banks turned to look at his wife with a smile and said, "Yes."

"OK, alright. That's wonderful," Biery said. "It's bad enough as it is. So don't make it worse, OK?"

"Yes, sir," Banks responded.

"I've lived through those tragedies," Briery told the former advisor, mentioning a man who flinched while trying to put a bullet in his head and wound up paralyzed. "He comes from a very wealthy family like you. But it was devastating."

After the proceedings ended, Duncan and Ali Banks simultaneously exited their respective rows into the center aisle of the courtroom. Duncan extended his hand, which she shook, and they exchanged a smile.

As Charles and Ali Banks left the courthouse, smiling broadly and holding hands, Ali Banks gave Wells, Duncan's lawyer, a pat on the shoulder as she walked past him, prompting a perplexed expression from Wells.

He recalled the moment years earlier during a failed mediation session, when Wells said he tried to convey to Banks that he would not benefit from going to court: “I said, 'Charles, how can you possibly think this is going to end well for you?' "

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