Former Philadelphia Eagles Super Bowl champ Mychal Kendricks was indicted on insider trading after allegedly being tipped off by an investment banker who wrote for the show “Black-ish.”
Kendricks, 27, currently a linebacker for the Cleveland Browns and resident of Fresno, California, and Damilare Sonoiki, 27, a former investment banker from Beverly Hills, California who was a writer for the television series “Black-ish,” are both facing charges over an allegedly illegal stock tip that Sonoiki is said to have given Kendricks.
“As alleged, Mr. Sonoiki and Mr. Kendricks cheated the market, cheated other investors, and placed themselves above the law,” said U.S. Attorney William McSwain in a statement. “When individuals engage in insider trading – buying and selling securities based on material, non-public information – it undermines faith in our financial markets and harms ordinary investors who do play by the rules. … My office will continue to work with our law enforcement partners to maintain the integrity of the financial markets, which is one of our top priorities.”
Federal prosecutors say Sonoiki and Kendricks could face a maximum possible sentence of 25 years in prison and a $5.25 million fine, plus a possible restitution order, for Sonoiki allegedly tipping off Kendricks to corporate mergers and leading him to net $1.2 million in profitable trades.
The Browns said Wednesday night that Kendricks would be released from the team. He only played in four pre-season games with the Browns.
We’ve released LB Mychal Kendricks
Details>>https://t.co/7rtaA2bRc7 pic.twitter.com/rp40lkUxe5
— Cleveland Browns (@Browns) August 30, 2018
Kendricks was an integral member on the Eagles’ Lombardi Trophy-winning squad, who left the team and moved to the Browns during the off-season. Sonoiki is a television writer and producer and former investment banker whose credits include working as a staff writer on Season 2 of the critically acclaimed series “Black-ish.”
Specifically, prosecutors claim that Kendricks acted on Sonoiki’s tip about an impending merger to purchase shares of telecom companies Compuware, Move, Sapient, and Oplink, then sold the shares after the merger at a profit of $1.2 million – with one trade netting a 400 percent profit, according to the Securities & Exchanges Commission (SEC).
The scheme was hatched after the two met a party, the SEC said. Kendricks allegedly repaid Sonoiki for the tips with NFL tickets, cash kickbacks, and by inviting him for the evening on the set of a Tevana Taylor music video in which Kendricks made a cameo, according to the SEC. “Bread” and “cheesesteak” were allegedly codewords Sonoiki used to refer to kickbacks in text messages with Kendricks, according to the indictment.
“As alleged, Mychal Kendricks used material non-public information, provided by his co-defendant, to score significant profits from expected market moves,” said FBI Philadelphia Assistant Special Agent in Charge Christian Zajac. “That’s not merely gaming the system—that’s a federal crime.”
In a statement, Kendricks said that he had indeed participated, in insider trading, laid blame on his co-defendant Sonoiki, and apologized to his teammates and the NFL. He added that he didn’t keep any of the profits.
“Four years ago, I participated in insider trading, and I deeply regret it,” Kendricks said in a statement posted on Twitter. “I invested money with a former friend of mine who I thought I could trust and who I greatly admired. … I had worked my tail off since I was 5 years old to become a football player. … While I didn’t fully understand all the details of the illegal trades, I knew it was wrong, and I wholeheartedly regret my actions. … Although I did not take any of the profits for myself, I am committed to repaying all the funds gained illegally and accepting the consequences of my actions.”
A statement from #Browns LB Mychal Kendrick, who has just been charged by the feds for insider trading. Wow. pic.twitter.com/0IEsV6lPTh
— Ian Rapoport (@RapSheet) August 29, 2018
Sonoiki, a son of Nigerian immigrants, grew up in Southwest Houston and through the A Better Chance program went to a boarding school in Virginia before attending Harvard, according to a talk he gave at the school in 2013. He was hired as a junior trader at Goldman Sachs shortly after college. He later told an interviewer work in banking felt “soulless.”
“Finance is, it can be a little soulless and it wasn’t very fulfilling you know?” Sonoiki told Kimberly Foster in an interview about his career for the Black Media Minute podcast, as he described his transition to television. “In a few months I will be soullessly investment banking and hating my life in New York or I’ll be writing for this TV show in LA. After a few weeks, I’d say the end of April, it was like ‘Oh, it’s official.’ I left Goldman May 1st, last year.”
Sonoiki or his attorney could not be immediately reached for comment on the charges.
The Philadelphia Eagles and Mychal Kendricks
Mychal Kendricks was released by the Eagles in the offseason, after spending six seasons with the team. It did not take long for Kendricks to find a new team, however, as he was signed to a one-year deal worth $2.25 million by the Cleveland Browns.
The 5-foot-11 linebacker was drafted in the second round of the 2012 NFL Draft by the Eagles. With Philadelphia, Kendricks played in 85 games (started in 74) and racked up 454 total tackles, 27 pass deflections, 14 sacks, six forced fumbles, and three interceptions.
Despite being a liability in pass coverage as his career progressed, Kendricks played a vital role on the Eagles’ defense, helping them en route to a Super Bowl victory over the New England Patriots.
Additional reporting by Jovan Alford
