Federal prosecutors have asked a judge to drop criminal charges against Jonathan Brad Augustine, the ex-AAU director who was one of the 10 men arrested last year as part of an alleged corruption scandal in college basketball.
Augustine had been accused of participating in the scheme, which authorities said was designed to funnel money to the families of recruits to ensure players signed with Adidas-sponsored colleges and then signed deals with certain advisors and with Adidas when they turned pro. Authorities said the scheme involved University of Louisville men’s basketball coaches and recruits.
But in a federal court document filed late Friday, prosecutors moved to dismiss the case against Augustine, who had been charged with wire fraud, conspiracy to commit wire fraud and conspiracy to commit money laundering.
It’s unclear why charges were dropped against Augustine. A spokeswoman for the U.S. Attorney’s Office in Manhattan declined to comment. Augustine’s lawyers did not respond to a Courier Journal email seeking comment sent before 1 p.m. Monday.
But the Wall Street Journal, which broke the news of the court filing on Saturday, said that it’s likely that prosecutors didn’t have enough evidence to pursue charges against him, citing “people familiar with the case.”
Augustine and financial adviser Munish Sood may have been negotiating with the U.S. Attorney’s Office about a potential plea deal because they were the only two who have not been indicted by a federal grand jury.
The FBI complaint released in September alleged Augustine was part of the attempted scheme to funnel money from Adidas to two players or their families. The athletes, who were not identified in the complaint, were members of Augustine’s Adidas-sponsored 1-Family AAU basketball program based in Florida. The complaint alleges the men conspired to steer one athlete to Louisville and another to Miami — both Adidas-sponsored programs — and later to have the athletes sign with a firm being started by sports agent Christian Dawkins and financial advisor Munish Sood and with Adidas when they turned pro.
During a July meeting to discuss the unnamed Class of 2019 Louisville recruit, Augustine accepted $12,700 cash in an envelope offered by an undercover agent while being recorded in a Las Vegas hotel room and while an unnamed Louisville assistant coach was also present, according to the complaint.
Dawkins said the money was to “take care of July, of August” and had previously told an undercover agent that Augustine would need $5,000 to be passed along to the unnamed Louisville recruit’s family by August, according to the complaint.
Augustine also allegedly conspired in an attempt to pay $150,000 to the family of the unnamed Class of 2018 Miami recruit who was part of his AAU program.
Augustine resigned from his position with the program after the allegations.
The move to dismiss the charges came the same week as two major developments in the scandal, which resulted in the arrests of two Adidas employees, a sports agent, four men’s basketball assistant coaches and the owner of a clothing company who was formerly an NBA official.
In motions filed Friday, attorneys for Adidas executive James Gatto, Adidas consultant Merl Code and Dawkins asked a judge to throw out wiretap recordings and suppress evidence from searches of the three men’s phones.
The FBI had ordered a wiretap of a phone used by Gatto who spoke to Rick Pitino on the calls at the center of the pay-for-play allegations that cost the former Louisville men’s basketball coach his job, records show.
The attorneys argue the wiretap orders were made out of the court’s jurisdiction, that at least one wiretap order must be thrown out because it did not include the name of the official who authorized the order and that the search warrants were overly broad in allowing authorities to search the phones belonging to Gatto, Code and Dawkins.
Earlier in the week, the Wall Street Journal reported that an undercover agent involved in the investigation is accused of misusing government funds. The agent is alleged to have used government money on beverages, food and gambling, and the Justice Department opened an inquiry into the agent’s behavior last year.