SEC Charges Former Football Player For Running $10 Million Fraud

The perpetrators used the funds raised from investors to pay for personal expenses and to repay earlier investors.

The Securities and Exchange Commission (SEC) has charged Merrill Robertson Jr., a former Philadelphia Eagles player, together with Sherman C. Vaughn Jr. and the company they co-owned, Cavalier Union Investments, with defrauding investors.

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According to the SEC, the defendants promised to invest in diversified holdings but diverted nearly $6 million from 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 are alleged to have lied about the unregistered debt securities they sold, saying they would yield as much as 20 percent “while providing safety and security for our investors.”

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

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The defendants allegedly hid this fact from potential investors and relied on cash from new investors to stay afloat.

The complaint further alleges that Cavalier’s only investments were in restaurants that had all failed by 2014, something the defendants never disclosed as they continued soliciting and accepting investors’ money.

Sharon B. Binger, Director of the SEC’s Philadelphia Regional Office, said: “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. 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 charges Robertson, Vaughn, and Cavalier with violations of the antifraud and registration provisions of the federal securities laws and is seeking permanent injunctions, return of allegedly fraudulent gains and civil penalties.

In a separate case in June this year, Mark Sanchez, a former New York Jets quarterback, along with a number of other professional athletes, was reported to have been duped out of approximately $30 million in a Ponzi-like scheme engineered by investment adviser, Ash Narayan, as reported by Finance Magnates.

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