October 22, 2010 12:00:00 am

John Elway victim of alleged Ponzi scheme

By Eric Kidd

Former Denver Broncos quarterback John Elway is used to seeing his name in the headlines. Unfortunately for the nine-time All-Pro, since his retirement in 1999, those headlines have been more and more about bad investments made on his behalf.

Most recently, Elway has been ensnared in what officials are calling a Ponzi scheme allegedly perpetrated by Sean Mueller of Greenwood Village. Mueller Capital Management took $15 million from Elway and approximately $71 million from a total of 65 investors since 2000, according to an affidavit filed by the Denver District Attorney. Other documents that Colorado’s Security Commissioner filed in court show three investors with at least $20 million in Mueller’s funds, and 30 others with “substantial investments.”

Mueller, 42, was apprehended in April, shortly after e-mailing out a suicide note in which he apologized to investors and threatened to jump off an RTD parking garage. DA Mitch Morrissey charged Mueller on Tuesday with violating the Colorado Organized Crime Control Act, securities fraud and two counts of theft.

This isn’t the first time Elway has gotten entangled with an alleged schemer. Just last year Elway, who has parlayed his celebrity into a public speaking career, was contracted to speak at an event held by a Centennial-based investment firm, Speed of Wealth LLC. It was later learned that Speed of Wealth had lured clients into dumping more than $30 million into environmentally friendly refineries and biochar, a charcoal substitute made from organic waste – but those refineries had not been built and the company held no patent on the biochar process. Elway was quick to distance himself from the company after the scandal broke. Jeff Sperbeck, Elway’s agent, declared “We’re aware of the investigation… We have no ongoing relationship (with the companies).”

Sometimes, like Elway’s investment in arena football, he and other retired athletes just seem to have their money in the wrong place at the wrong time. And who can forget MVP.com? The site was backed by superstars including Elway, hockey great Wayne Gretzky, and His Airness himself Michael Jordan, but was yet another casualty of the dot-com bubble bursting in the earlier part of the decade.

However, Elway did see some real success with his car dealerships even before he retired from the NFL, selling them to former Miami Dolphins and Florida Marlins owner Wayne Huizenga’s Republic Industries for $82.5 million in stock options in 1997, and remaining on as the centerpiece of their local advertising campaigns until 2006. During that time, the stock value plummeted from $30 a share to an all-time low of $6, and most recently, was valued at almost $24 a share.

While the Denver restaurants that bear his name are doing well, it seems that since Elway left the field of play, even his Stanford degree can’t keep him from putting another checkmark in the loss column.

This is the first in a series of athletes and their investments. In future posts, we’ll explore investment managers who prey on professional athletes, athletes who have done it the right way as well as those who have done it the wrong way, and sports agents who may not have their clients’ best interests in mind.