Securities and Exchange Commission
Former Football Player Found Guilty of $10 Million Fraud in Second Criminal Trial
Litigation Release No. 24667 / November 15, 2019
Securities and Exchange Commission v. Merrill Robertson, Jr., et al., No. 16-cv-667 (E.D. Va. filed Aug. 10, 2016)
United States v. Merrill Robertson, Jr., No. 16-cr-133 (E.D. Va. filed Aug. 10, 2016)
On October 28, 2019, a federal jury in Richmond, Virginia again returned a guilty verdict against Merrill Robertson, Jr., a former football player charged with defrauding investors, including coaches he knew from his time playing football for the Fork Union Military Academy and the University of Virginia. Robertson was convicted on these charges for the first time in August 2017 and was sentenced to forty years in prison in December 2017. Earlier this year, the U.S. Court of Appeals for the Fourth Circuit vacated Robertson's conviction and remanded the case to the district court. He will be sentenced for a second time on January 3, 2020.
The criminal charges against Robertson arose from the same conduct alleged in a complaint filed by the Securities and Exchange Commission. According to the SEC's complaint, Robertson, Sherman C. Vaughn Jr., and the company they co-owned, Cavalier Union Investments LLC, promised to invest in diversified holdings but stole nearly $6 million of the more than $10 million they raised from investors. They spent the stolen money on personal expenses such as cars, family vacations, repayment of mortgage and credit-card debt, luxury goods, clothing, entertainment, educational expenses for family members, and a luxury suite at a football stadium. Vaughn previously pled guilty in the criminal case.
In the SEC case, the Court previously entered final judgments against Robertson and Vaughn, ordering them to pay over $8 million in disgorgement and permanently enjoining them from violating the registration and antifraud provisions of Sections 5(a), 5(c), and 17(a) of the Securities Act of 1933 and Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder.
At the time of the alleged misconduct, Robertson was not registered as a broker, and Vaughn never was registered with the SEC. The SEC encourages investors to check the backgrounds of people selling investments by using the SEC's investor.gov website to quickly identify whether they are registered professionals and confirm their identity.
The SEC appreciates the assistance of the U.S. Attorney's Office for the Eastern District of Virginia and the Federal Bureau of Investigation.