FROM: SECURITIES AND EXCHANGE COMMISSION
Charges Texas Resident and Company in $10 Million Oil and Gas Fraud Scheme
The Commission's complaint alleges that offering documents prepared and distributed by the defendants falsely claimed that investors would receive working interests in oil and gas wells when, in fact, Couch and Couch Oil & Gas retained those working interests and never transferred them to investors. The complaint also alleges that the defendants falsely represented to investors that most or all of their funds would be used to drill and complete the wells and failed to inform them that, among other undisclosed expenses, approximately 30% of their funds would be used to make sales commission payments to unregistered brokers. The complaint further alleges that the defendants made unsubstantiated and highly inflated projections concerning potential oil and gas production from the wells and falsely portrayed to investors that defendants were experienced and successful at radial jet drilling technology.
The complaint charges Couch and Couch Oil & Gas with violating Sections 5(a), 5(c), and 17(a) of the Securities Act of 1933 and Sections 10(b) of the Securities Exchange Act of 1934 and Rule 10(b) thereunder. The Commission is seeking permanent injunctions, disgorgement with prejudgment interest, and civil penalties against each defendant.
This matter was investigated by Tamara McCreary, Ty Martinez, Joseph Dugan and Douglas Gordimer, under the supervision of Jonathan P. Scott, all of the Fort Worth Regional Office. Janie Frank and Jessica Magee will lead the litigation.
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