California man accused of defrauding former Colt of more than $4.5M

A financial adviser in California faces allegations he defrauded a former Indianapolis Colts player out of more than $4.5 million.

On Friday, U.S. Attorney Josh Minkler announced the indictment of Kenneth Ray Cleveland, 63, of suburban Los Angeles. Cleveland faces seven charges of wire fraud and three counts of money laundering.

The U.S. Attorney's Office would not disclose the victim's name, calling him only "Individual A," but the description it provided fits only one player: Cory Redding, 36, a defensive lineman who played with the Colts from 2012 to 2014.

The victim played for the National Football League from 2003 to 2016 and lived in Carmel from July 2012 and May 2015, the indictment says. Cleveland served as the financial adviser for the player nearly his entire career.

Acting on a referral from one of his college professors, the victim hired Cleveland to help him manage his NFL earnings and plan his post-football financial life. Over the years, the victim gave Cleveland more than $7 million to invest on his behalf, the indictment says.

Cleveland told the victim that he would put the money into conservative investments but instead spent more than $4.5 million of it, the indictment says. 

Prosecutors allege Cleveland used $2 million from the victim to pay “fictitious investment returns and principal” to other investor clients, and to return $240,000 to the victim in the form of “fictitious investment returns.”

The indictment also alleges that Cleveland used another $2 million for personal expenses, including bill payments and payments to his mother, sister and daughter.

Prosecutors say Cleveland hid his fraud by giving the vicitm false financial statements and repeated assurances his investments were performing well. 

“Cleveland praised Individual A’s decision to invest with him by comparing Individual A’s purported financial security to other NFL players who had reportedly squandered their earnings,” the indictment says. “At no point did Cleveland mention that he had spent the majority of the money that Individual A invested with him.”

The situation unraveled when the victim asked for his money back but Cleveland could not provide it, Minkler’s office said.

The charges against Cleveland carry maximum sentences of 10 to 20 years of imprisonment, plus a fine of up to $250,000.

If he is found guilty, the indictment also orders Cleveland to forfeit the property or money gained from the offenses.

This is not the first time Cleveland has faced legal action over his financial dealings.

Television producer William S. Bickley, whose credits include "Happy Days" and "The Love Boat," sued Cleveland in August 2013. Bickley’s suit claimed that Cleveland, whom he had considered a lifelong friend, stole at least $6 million from him while serving as his business manager, according to an account in the Hollywood Reporter.

Cleveland's phone in California was disconnected.