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Former basketball players accuse firm of investment fraud

April 16, 2010

Three former professional basketball players from Serbia—two of whom had National Basketball Association careers—have sued a local company, accusing it of investment fraud.

One of the company’s principals, Rick Suder, denies their charges and blames the soured investments on the economic downturn.

Dejan Bodiroga and Zeljko Rebraca filed a federal lawsuit April 9 against Carmel-based Worldwide Associates LLC, alleging they each gave the company more than $4 million to manage. According to their complaint, Worldwide used their money as venture capital in speculative startup companies instead of investing it in traditional securities.

Their joint lawsuit points out that Suder paid a $10,000 fine 10 years ago to settle a claim that he was not a properly licensed investment broker/adviser.

Indiana Secretary of State records confirm that its Securities Division issued a cease-and-desist order against Worldwide Financial Management Group LLC, originally known as Worldwide Sports Management LLC, on Aug. 15, 2000, and followed it with a March 26, 2001, consent agreement requiring the company to pay a $10,000 fine and for its principals to become registered investment adviser representatives prior to conducting business in Indiana.

Worldwide also faces pending federal litigation from another Serbian former player. On Feb. 11, 2009, Predrag Danilovic filed a similar suit against the company, also alleging investment fraud connected to $4 million he gave Worldwide to manage.

Suder filed a personal Chapter 13 bankruptcy petition last July 31, listing $380,157 in assets and $566,186 in liabilities. Danilovic’s lawsuit is listed among the bankruptcy’s unsecured claims, with no figure attached.

Indiana Secretary of State office spokesman Jim Gavin shared copies of the state’s 10-year-old Worldwide cease-and-desist order and subsequent consent agreement, but said he could not comment on whether the Securities Division has any current investigation open.

Attorneys representing the three basketball players did not respond to IBJ’s calls.

In a pair of telephone interviews, Suder said he reorganized his company after the consent agreement as more of a general consultancy for professional athletes.

“Our goal was to work with professional athletes and provide various services,” he said. “Our services were general in nature. It was helping these guys come over here, get situated with the U.S. from Europe, helping set up Social Security numbers, mortgages. Getting them acclimated to life in the U.S.”

Bodiroga and Rebraca’s suit alleges some of their money went toward venture capital investments in a pair of speculative startup companies: iStreamPlanet Co. and SuperDrive Inc. Suder said it’s true they have investments in those two companies. Suder said he has itemized statements showing where the players’ money went and called their investments in those firms “illiquid.”

“My personal goal is to make sure nobody loses any money,” Suder said. “I’d be happy if those companies were liquidated and everyone was paid back prior to me receiving anything.”

“I’m not trying to hide from anything,” Suder said. “I’ve told these guys that.”

According to NBA.com’s Hoopedia, Bodiroga, 37, was the Sacramento Kings’ 51st pick in the 1995 draft. A 6-foot-9 shooting guard and small forward, he spent his entire playing career in Europe, retiring in 2007.

Rebraca, 38, was the Seattle SuperSonics 54th pick in the 1994 draft. A 7-foot center, he played for the Detroit Pistons, Atlanta Hawks and Los Angeles Clippers. Rebraca also retired in 2007.

Danilovic, 40, a 6-foot-6 shooting guard, was the Golden State Warriors 43rd pick in the 1992 NBA draft. Before retiring in 2000, he eventually played for the Dallas Mavericks and Miami Heat and won a silver medal in the 1996 Olympics as part of Yugoslavia’s basketball team.

In the telephone interviews, Suder expressed concern that media attention would make it harder for the startups to succeed, possibly costing Indiana jobs, and for him to ultimately repay Worldwide’s clients.

“Having this complaint filed and the potential for negative press makes our job more difficult,” he said. “Our hope is to come to agreement with investors quickly, so we can put this behind us.”
 

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