The Securities and Exchange Commission charged former pro football player Merrill Robertson Jr. on Wednesday with defrauding mainly elderly investors, including former coaches, out of $6 million.

According to the SEC complaint filed in federal court in Richmond, Virginia, Robertson — a former player with the Philadelphia Eagles — along with Sherman Vaughn Jr., and the company they co-owned, Cavalier Union Investments LLC, promised to invest in diversified holdings but diverted nearly $6 million of the more than $10 million they raised from investors to pay for personal expenses and used other funds to repay earlier investors. 

Robertson and Vaughn, both of whom are unregistered to sell securities, are alleged to have lied about the unregistered debt securities they sold, saying they would yield as much as 20% “while providing safety and security for our investors.”

The scheme allegedly targeted seniors and coaches, donors, alumni and employees of schools Robertson had attended, including coaches Robertson knew from his time playing football for the Fork Union Military Academy and the University of Virginia.

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In a parallel action, the U.S. Attorney’s Office for the Eastern District of Virginia announced criminal charges against Robertson the same day. 

According to the complaint, the defendants claimed that Cavalier had investment funds operated by experienced investment advisors when, in fact, the firm “did not have any funds or investment advisors and was functionally insolvent shortly after it was formed.”

The defendants, the complaint states, “allegedly hid this fact from potential investors and relied on cash from new investors to stay afloat,” and further alleges that Cavalier’s only investments were in restaurants that had all failed by 2014, a fact the defendants never disclosed as they continued soliciting and accepting investors’ money. 

“Our complaint alleges that Robertson and Vaughn preyed on elderly victims and others who placed their trust in these individuals, only to have their savings stolen,” said Sharon Binger, director of the SEC’s Philadelphia Regional Office. “We will continue to aggressively pursue fraudsters who exploit their relationship of trust with victims and promise returns that appear to be too good to be true.”    

The SEC’s complaint charges Robertson, Vaughn and Cavalier with violations of the antifraud and registration provisions of the federal securities laws and seeks permanent injunctions, return of allegedly ill-gotten gains with prejudgment interest, and civil penalties. 

(For more on this story check out: Ex-Eagle Accused of Running $10M Ponzi Scheme)

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