Feds Say Ex-NFL Player Stole From Investors

(CN) — Former pro football linebacker Merrill Robertson Jr. defrauded investors by spending millions of dollars of their money on personal expenses, the Securities and Exchange Commission claims.

The SEC filed a complaint against Robertson and Cavalier Union Investments co-owner Sherman C. Vaughn Jr. in Federal Court on Wednesday, claiming the two men diverted more than half of the $10 million they raised from investors to pay for personal expenses.

Robertson signed with the Philadelphia Eagles as an undrafted free agent in 2003, but he was cut that August before the National Football League's regular season began. Before that, he played linebacker for the University of Virginia.

The two Chesterfield, Va., natives hid from investors the fact that Cavalier was functionally insolvent soon after it was formed, according to the SEC's complaint.

"[Cavalier] relied on cash from investors to stay afloat and pay investors who requested their money back. The few investments it made were in restaurants that suffered substantial losses and ultimately failed," the complaint states. "Defendants knew that Cavalier could not pay all its obligations. They began bouncing checks shortly after starting the business."

Robertson and Vaughn "treated Cavalier like their personal piggybank" and "stole nearly$6 million in investor money and used it for themselves on things like cars, family vacations, spa visits, luxury goods, educational expenses for family members, and a luxury suite at a football stadium," the SEC alleges in its 17-page lawsuit.

The two men allegedly targeted elderly investors and former coaches and employees of schools Robertson attended.

In addition to the SEC's civil complaint, Robertson also faces criminal charges brought by the Eastern Virginia U.S. Attorney's office.

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