Ex-Eagles Player Embroiled in $10 Million Ponzi Scheme

Typically, it's the wealthy and unsophisticated athlete who gets drawn into an investment scam and loses his or her money. But in a twist of the usual story, this week a judge in Virginia federal court ordered a former broker and his alleged accomplice, former Philadelphia Eagles linebacker Merrill Robertson Jr., to forfeit $8 million. The money was allegedly generated by Robertson and Sherman Vaughn Jr. through the operation of a Ponzi scheme which lasted from 2009 to 2016.

Ex-NFL Player and Ex-Broker Used Network to Find Investors for Ponzi

According to federal prosecutors, who also sentenced Robertson to 40 years in prison for various federal offenses, the ex-NFL player and the ex-broker conspired to solicit individual investors to invest in private funds that they managed. The two men identified potential investors using contacts Robertson had made through the NFL and his alma maters, University of Virginia and Fork Union Military Academy. Among the more than 50 investors defrauded, they included elderly clients, former coaches, donors, alumni, and school employees. Court records show that Robertson and Vaughn took the nearly $10 million they collected from investors and used it for personal spending, including on mortgage payments, car payments, school tuitions, spa trips, luxury goods, and vacations.

How to Identify a Ponzi Scheme

Ponzi Schemes can be extremely difficult to identify. It's not always clear to investors - or even regulators who are scrutinizing an particular investment entity (think Madoff) - what is real and what is make-believe. Usually, a Ponzi Scheme has to implode before its true nature is revealed.

However, Ponzi Schemes and their operators typically rely on individual greed and naivete to bring off their nefarious plans. They sell investors on the dream of unusually high rates of return that are "guaranteed." This is the archetypal too-good-to-be-true scenario. Unfortunately, it works! The best way to protect yourself against a Ponzi Scheme is remember that there is no such thing as a "guaranteed" investment opportunity, and that the reason you see a return on your money is because it involves risk. With no risk, there can be no reward.

Pennsylvania & New Jersey Ponzi Scheme Law Firm

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If you or someone you know has been the victim of investment fraud or broker misconduct, please contact our securities litigation team immediately for a free consultation toll-free at 215 462 3330 or by using our online contact form.

 

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