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Merl Code Jr. among those arrested in college basketball fraud case Greenville native and former Clemson University basketball player Merl Code Jr. is scheduled to appear in federal court in New York on Oct. 10 in connection with a corruption case a prosecutor said unveils the “dark underbelly of college basketball.” Code was one of 10 people arrested as a result of a two-year FBI investigation. Four college basketball coaches, Adidas’ director of global sports marketing for basketball Jim Gatto, and business managers and financial advisors were also charged in the case. Code, who worked for Adidas, was charged with wire fraud conspiracy, wire fraud, and money laundering conspiracy, according to court documents. The investigation alleges that high school athletes were bribed to play for colleges sponsored by Adidas and that college coaches accepted money in exchange for steering players to preferred financial advisors, business managers, and agents. Court documents allege that Code “participated in organizing some of the payments” from Adidas to the players and their families. Court documents said Code and Gatto worked together to funnel $100,000 to the family of a Louisville recruit and $150,000 to a recruit at the University of Miami. The complaint said Gatto and Code needed time to generate a sham purchase order and invoice to justify using Adidas funds, since they couldn’t pay the family directly. According to the complaint, Code said his “group” had been paid money from Adidas “off the books,” but there were complications funneling the money to the player’s father through Adidas, because he didn’t have a vendor number for his consulting company. In a subsequent recorded call, Code said Gatto handled the payment as one to an “outside organization affiliated with Code” and that the payment was put on Adidas’ books as a payment to his team. “So it’s on the books, [but] it’s not on the books for what it’s actually for,” the complaint said. Court documents said the investigation has been ongoing since 2015. —Cindy Landrum

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October 6, 2017 GJ  
October 6, 2017 GJ  

Weekly newspaper with, for, and about Greenville, South Carolina. Published by Community Journals.