The Sports Xchange

Former NFL cornerback Will Allen had civil fraud charges filed against him after the Security and Exchange Commission accused him of being part of a $31 million Ponzi scheme involving loans made to pro athletes, multiple media outlets reported Tuesday.

Based on a complaint unsealed on Sunday, Allen and Susan Daub formed a company called Capital Financial Partners and had been running the Ponzi scheme from 2012 until this year.

Investors were told they could receive interest of up to 18 percent through repayments of loans made to professional athletes. Athletes supposedly were given loans of at least $75,000 when they may have needed cash during the offseason, and then paid it back at a high interest rate from their lucrative contracts.

The company raised $31 million from about 40 investors but used some of the funds to pay for personal expenses, including pawn shops, night clubs and casinos, according to the complaint.

The SEC said Allen and Daub received $13 million in loan repayments from athletes but paid $20 million to investors. To make up the difference, Allen and Daub’s company paid investors with funds from other investors, rather than from the company’s profits. That represents a Ponzi scheme.

Allen’s assets were frozen by a Boston judge. The SEC wants an injunction served against Allen and Daub and their company. It also wants them to pay penalties.

Allen, 36, played in the NFL from 2001 to 2012. He was a member of the New York Giants, the Miami Dolphins and the New England Patriots.