Former professional football player Merrill Robertson Jr.is charged with defrauding investors, including coaches he knew from his past, the Securities and Exchange Commission said Wednesday.
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In a deposition with the SEC, The Justice Department said “Robertson acknowledged that Cavalier failed to pay back the approximately $8 million in principal invested with the company and stated that Cavalier now has no income or assets”, adding that he used investor funds to pay for personal expenses, such as his mortgage and vehicle payments.
Robertson competed for a starting spot for the Virginia Cavaliers football team at inside linebacker during the 2001 season, according to biographical information on the university’s website.
The U.S. Attorney for the Eastern District of Virginia says the 36-year-old Robertson and his business partner live in Chesterfield County.
Attempts to reach his business partner, Sherman C. Vaughn Jr., weren’t immediately successful.
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The scheme allegedly defrauded elderly individuals, former coaches, donors, alumni and employees of the schools.
Investors were promised they would get their money back, plus interest-10% to 20%, according to the complaint. “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 two are accused in the complaint of portraying themselves as experienced investment experts and Cavalier as a sophisticated company, “with various divisions, investment funds, and investment advisors”.
In a deposition with the U.S. Securities and Exchange Commission (SEC) in October 2015, Robertson admitted that the company failed to pay back the $8 million in principle that was given to him by investors while admitting the company now had no assets.
The only investments made by Cavalier Union Investments were restaurants that failed by 2014, the government said.
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“The defendants allegedly hid this fact from potential investors and relied on cash from new investors to stay afloat”, the SEC said in a statement. The SEC’s litigation will be led by David L. Axelrod and John V. Donnelly.
