SEC Shuts Down Alleged Oil and Gas Scam

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SEC Shuts Down Alleged Oil and Gas Scam

On December 9, 2009, in Investor Protection, Investors at Risk, Oil and Gas, SEC, Scams, Securities Industry (general), Texas, by Investor's Watchblog

The U.S. Securities and Exchange Commission (“SEC) has charged Striker Petroleum LLC (“Striker”) and its principals, Mark S. Roberts and Christopher E. Pippin, all of Texas, with operating a $57 million fraud. Specifically, the SEC claims that Striker raised those millions by selling debentures to 540 investor nationwide. Striker represented that the debentures were collateralized by [...]

The U.S. Securities and Exchange Commission (“SEC) has charged Striker Petroleum LLC (“Striker”) and its principals, Mark S. Roberts and Christopher E. Pippin, all of Texas, with operating a $57 million fraud. Specifically, the SEC claims that Striker raised those millions by selling debentures to 540 investor nationwide. Striker represented that the debentures were collateralized by oil and gas properties. The SEC alleges that Striker misrepresented its earnings and asset valuations, its use of investor proceeds, and the existence of a third party independent trustee for the debenture collateral.

The SEC alleges that Striker sold the debentures during a time that gas cost $5 per gallon. The spike in gas prices no doubt made the sales easier. Whether the SEC’s allegations against Striker prove true, scam artists often take advantage of headlines, which give them a head start in establishing the aura of legitimacy so essential to the success of the scam. When gasoline costs $5 per gallon, it is not difficult to convince investors that those who own oil and gas wells can make money.

Beware any investment that appears to take advantage of stories in the headlines. Investigate any unregistered investment before you buy. Countless senior citizens are starting over with nothing because they failed to do so.