In the predawn darkness of July 15, less than a mile off shore, the missing man floated on a yellow Jet Ski on Galveston's West Bay. David Salinas, the celebrated operator of an elite AAU basketball team called Houston Select, had plenty of fuel to head landward—at 5:45 a.m., in fact, he'd gotten gas at a marina near his vacation home in Terramar Beach. Instead he bobbed in the waves, despondent in his ubiquitous baseball cap, boat traffic narrowly passing by. Salinas had been well-liked and trusted by a wide circle of friends that included Division I college basketball coaches, Texas oilmen and pro athletes. Now all of them wondered where the hell he'd gone. And how deep the trouble would go.
Salinas, chairman of the J. David Financial Group, hadn't returned calls or text messages for nearly a week, including those from the Securities and Exchange Commission, which needed to question him about eight figures' worth of bonds whose existence was in doubt. His panicked family, suspecting Salinas had gone to their vacation home, had called the Galveston police department at 10:46 the night before to report him missing.
Finally, at around 10 a.m. on this cloudy Friday, an orange Coast Guard helicopter spotted the stocky 60-year-old aboard his watercraft, lingering on the edge of the ship channel. As two young lifeguards approached on a Jet Ski of their own to retrieve him, Salinas calmly told them that he'd been on the water all night, "just drifting with the current."
Only later, once he had returned to the Terramar dock, did he begin to reveal his desperate situation, telling the Galveston police that he was depressed and had planned to crash his Jet Ski to end his life. The officers responded by escorting him to St. Joseph Medical Center in downtown Houston for psychiatric evaluation.
He was soon discharged. Within 48 hours, on the morning of July 17, Joel David Salinas died of a self-inflicted gunshot to the head.
"Dear Coach Salinas: Many people would find fault in a man as impatient as yourself, but I always found it to be one of your best attributes ... I realized that deep within that drill sergeant demeanor you portrayed at every practice and game was a man who cared more about his players than anything in the world."
—Former Princeton and Houston Select guard Ed Persia
The scam that bilked nearly $8 million from at least 13 NCAA basketball coaches—as well as $47 million more from many other investors, including a former New Mexico athletic director and a southeast Texas church whose bond holdings were valued at $13.1 million—was surprisingly crude. Everyone involved had invested in what they believed to be a conservative portfolio of U.S. corporate bonds—General Electric, Xerox, Walmart, IBM, J.P. Morgan. But according to several sources close to the investigations being conducted by the SEC, the Justice Department and the Secret Service, those bonds never existed. One financial statement obtained by SI shows that a set of 13 CUSIP numbers (the bonds' publicly verifiable identification codes) was fabricated. Another investor, who had given Salinas his life savings, had no CUSIP numbers on his statement at all.
Salinas, who attended Stephen F. Austin from 1969 to 1972, then left while under academic suspension, was not a registered investment adviser or representative. His 31-year-old company, the J. David Financial Group, had achieved success brokering insurance for university athletics programs (Houston's, for example). In the late 1990s the group turned to money management, and in 2006, Salinas created a new, registered investment firm, Select Asset Management. It began recruiting investors to J. David Financial. He picked Brian Bjork, a cofounder of Houston Select and team manager under Rice and Wichita State basketball coach Scott Thompson, to run the company, which has since been subpoenaed by the SEC.
"What also gives me pause is that Select Asset Management issued the statements, and not an actual brokerage firm," says Kirk Smith, a longtime Houston-based securities attorney. "None of it looks right." ("Brian was devastated by the degree to which David deceived investors and Brian himself," says Bjork's lawyer, Matt Hennessy.)