— -- The federal government has dropped criminal charges against Jonathan Augustine, a former AAU basketball director from Florida, who was one of 10 men arrested in September for allegedly conspiring to funnel money from Adidas to recruits' families.
Augustine, the former president of The League Initiative and director of the 1 Family AAU in Orlando, Florida, was charged with wire fraud, conspiracy to commit wire fraud and conspiracy to commit money laundering after the FBI's two-year investigation into bribes and other corruption in men's college basketball.
The U.S. Attorney's Office asked a federal judge to dismiss charges against Augustine on Friday, and a spokesman for the U.S. District Court of Southern New York confirmed to ESPN on Tuesday that the case against Augustine is closed.
The Wall Street Journal first reported that the federal government had requested to dismiss the charges against Augustine.
The FBI's clandestine investigation led to the arrests of four assistant coaches: Arizona's Emanuel "Book" Richardson, Auburn's Chuck Person, Oklahoma State's Lamont Evans and USC's Tony Bland.
The FBI also alleged that Adidas executives Jim Gatto and Merl Code, sports agent Christian Dawkins and financial planner Munish Sood conspired with others to steer high-profile recruits to Adidas-sponsored schools, including Louisville and Miami. In return, the coaches would ensure that the players signed with Adidas, Dawkins and Sood when they turned pro.
The investigation led to the firings of Louisville basketball head coach Rick Pitino and athletic director Tom Jurich. Pitino and Jurich have denied knowing about the scheme to funnel money to players' families.
Augustine and Sood weren't indicted on the federal charges, and a person familiar with the case told ESPN that it's believed that Augustine and Sood are cooperating with federal authorities.
The FBI alleged that Augustine met with Gatto, Code, Dawkins and an unnamed Louisville assistant coach at a Las Vegas hotel room on July 27. Financial planner Marty Blazer, who was working with the federal government, and an undercover FBI agent were also in the meeting, which the FBI recorded with hidden video cameras.
During the meeting, the federal complaint alleges, Dawkins laid out plans to funnel money to the family of an unnamed Louisville recruit, who was scheduled to graduate from high school in 2019. "The mom is like, 'We need our f---ing money,'" Dawkins said. "So we got to be able to fund the situation. ... We're all working together to get this kid to [Louisville]. Obviously, in turn, the kid will come back to us."
When Dawkins mentioned they'd have to be careful because the Cardinals were already on NCAA probation, the Louisville assistant agreed. "We gotta be very low-key," he said.
The men agreed to funnel the money through Augustine's program, and he promised them that "all my kids will be [Adidas] kids." The undercover agent then handed Augustine an envelope containing $12,700 in cash, according to the FBI, and Dawkins told him that it would cover payments to the second player's family for July and August.
The FBI alleged the men also conspired to funnel about $150,000 to an unidentified player who was being recruited by Miami. They planned to follow a scheme similar to the one used with the Louisville recruits to keep the player from signing with a school sponsored by a rival apparel company, which they said had offered the player $150,000, according to the complaint.
Hurricanes coach Jim Larranaga has denied knowledge of the scheme.
In a separate motion filed on Friday, attorneys representing Code, Dawkins and Gatto asked a federal judge to exclude certain wiretap recordings and suppress evidence from the searches of the men's cellphones.