(Reuters) - U.S. securities regulators charged a former college football coach and Hall of Fame inductee, Jim Donnan , on Thursday with running an $80-million Ponzi scheme , the victims of which included other college coaches and former players.
Donnan, who coached football at Marshall University and the University of Georgia before becoming a television commentator, recruited contacts from his sports career as investors in the company he ran with business partner Gregory Crabtree , the U.S.
Securities and Exchange Commission said.
"Your Daddy is going to take care of you," Donnan told one former player who later invested $800,000, according to the SEC 's complaint.
The men told investors their company, GLC Limited , bought leftover merchandise from retailers and resold it to discount retailers.
They promised returns of 50 percent to 380 percent and raised $80 million from about 100 investors, the agency said. But only about $12 million went to buying merchandise, and the rest was used to pay fake returns to investors or stolen for other uses.
The scheme ran from August 2007 to October 2010, the SEC said in its complaint, filed in federal court in Atlanta. Much of the merchandise GLC purchased was left unsold in warehouses in West Virginia and Ohio.
Donnan, who lives in Athens, Georgia, took more than $7 million from GLC, the SEC said. Crabtree, who lives in Proctorville, Ohio, took more than $1 million.
The men have been charged with violating antifraud and registration provisions of federal securities laws.
(Reporting by Emily Stephenson; Editing by Bernadette Baum)