By Jennifer Riso
Sixteen current and former National Football League players have sued Branch Banking and Trust Company (BB&T) for mishandling approximately $60 million. Although the alleged mishandling occurred at BankAtlantic, LLC, BB&T purchased the Florida bank branch and has assumed the bank’s rights and liabilities.
Each Plaintiff entered in to an agreement with Pro Sports Financial, Inc. (Pro Sports), a financial management firm owned and operated by Jeffery B. Rubin. Pursuant to the Client Service Agreement (CSA), Pro Sports provided each player with tax planning, business counseling, and concierge services. See Compl. at 3. Each player entrusted Pro Sports with properly handling and managing millions of dollars deposited at BB&T. However, no Pro Sports employee had authority to make improper withdrawals without the player’s consent. See Compl. at 15.
The first subset of Plaintiffs allege that BB&T allowed accounts to be opened and maintained without their consent by forged signature cards presented to the bank by Pro Sports. Subsequently, all bank statements and correspondence were sent to Pro Sports rather than the individual, whose name was on the account, effectively ensuring the player’s ignorance to the fact that Pro Sports consistently withdrew money in amounts in excess of $10,000. See Compl. at 10.
A second subset of Plaintiffs held power of attorney accounts at BB&T to be used solely for concierge or bill pay services, pursuant to the CSA on file with BB&T. However, the complaint alleges that the accounts were used for “unauthorized or improper lending or business purposes.” See Compl. at 13. Similar to the first subset of Plaintiffs, Pro Sports consistently withdrew even dollar amounts in excess of $10,000. See Compl. at 15.
Specifically, most of the money taken from all Plaintiffs was used for the County Crossing Project, a casino-style gaming project in Alabama ultimately deemed illegal in July 2012. None of the plaintiffs approved of these transactions, and were not informed of the associated risks. See Compl. at 15.
The first subset of Plaintiffs claims negligence on behalf of BB&T. To bring a claim for negligence, the Plaintiffs must show that BB&T owed a duty to them and that BB&T’s action or inaction caused harm to the Plaintiffs. Here, Plaintiffs assert that BB&T owed each player “a duty to exercise reasonable care with respect to the opening and maintaining of any and all accounts opened” in their names. See Compl. at 16. Further, the complaint alleges that BB&T owed a duty with respect to safekeeping funds transferred to and from those same accounts. See Compl. at 16. BB&T’s failure to take action by ensuring Pro Sports had proper authorization to engage in these withdrawals ultimately caused the Plaintiffs to lose millions of dollars.
The second subset of Plaintiffs claims that BB&T breached their contractual agreements, which were established once accounts in their names had been opened. See Compl. at 17. BB&T allegedly breached this contractual agreement by opening a “power of attorney” account without having a power of attorney, “by occasionally accepting and acting upon instructions . . . by one or more persons who was/were not names as the power of attorney,” and by allowing transfers of funds in order to pay for improper transactions exceeding the scope of power of attorney. See Compl. at 18.
Both subsets of Plaintiffs assert that BB&T is required to repay the unauthorized or ineffective funds transfers. The complaint alleges that Plaintiffs did not have any agreement with BB&T with respect to funds transfers and that BB&T acted upon the unauthorized and ineffective transfers in bad faith, “and lacked reasonable and ordinary care in allowing the funds transfers.” See Compl. at 18-19.
Next, all Plaintiffs claim that BB&T aided and abetted Pro Sports in breaching its fiduciary duties. A fiduciary relationship occurs where one party is acting for the other’s benefit. Here, Pro Sports was managing the players’ finances, and BB&T had actual knowledge of the fiduciary relationship between the Plaintiffs and Pro Sports. Thus, BB&T should have acted to prevent improper withdrawals and transfers made by Pro Sports. See Compl. at 21. As a result of BB&T’s aiding and abetting, the Plaintiffs have incurred damages.
In addition, the Plaintiffs claim that BB&T is guilty of aiding and abetting fraud. The complaint maintains that Pro Sports held themselves out as attorneys-in-fact for the Plaintiffs with respect to tax planning, business counseling, and concierge services. See Compl. at 23-24. The Plaintiffs relied on Pro Sports’ representations that it would act within the scope and limits of their agreement, and were ultimately harmed by these false representations. See Compl. at 24. The Plaintiffs argue that BB&T had actual knowledge of this fraud and should have acted to prevent future harm to the Plaintiffs. See Compl. at 25.
All Plaintiffs further claim that BB&T breached its fiduciary duty to the Plaintiffs by the actions and inactions surrounding the opening and the maintenance of the accounts without the Plaintiffs’ consent. Finally, all plaintiffs assert that BB&T was negligent in supervising the accounts opened and maintained. Two BB&T employees who opened the accounts and managed the division failed to inform all Plaintiffs of account activity thus contributing to the loss. See Compl. at 33.
