SEC Files Charges in $80M Texas Oil and Gas Scam

The U.S. Securities and Exchange Commission is charging Breitling Energy Corp. (BECC), Breitling Oil & Gas Corporation, Patriot Energy Inc., Crude Energy, LLC, and eight people over an $80M Texas oil and Gas scam run by a Dallas man. Chris Faulkner, who is Breitling Energy Corp.’s CEO, is accused of starting the scam as far back 2011 through Breitling Oil and Gas Corporation (BOG), which sold “turnkey” oil and gas working interests.

Faulkner is charged with issuing misleading and false offering documents, trying to manipulate BECC’s stock, and misappropriating clients’ funds, including at least $30M for his own expenses, such costly meals, international travel, personal escorts, and jewelry. The SEC said that the false offering documents included fake statements and omissions regarding Faulkner’s experience, the ways in which investor money would be used, and drilling cost estimates. The documents also included reports by Joseph Simo, a licensed geologist. Simo’s production projections purportedly had no basis and the reports did not mention that he had ties to BOG.

The SEC said that BECC, Patriot Energy, and Crude Energy also were involved in the scam. Faulkner is accused of setting up the latter two companies so he could scam investors through additional offerings that resembled those offered by BOG. BOG, Patriot, and Crude would go on to raise over $80M from investors.

Also facing SEC charges are ex-Crude and Patriot employee Beth Hadkins, ex-BECC CFO Rick Hoover, BECC COO Jeremy Wagers, BOG co-owners Dustin Michael Miller Rodriguez, and Parker Hallam, Simo, and ex-BECC employee Gilbert Steedley. Wagers and Hoover,

along with Faulkner, are accused of misrepresenting different parts of BECC’s operations in public reports. Steedley purportedly helped Faulkner manipulate BECC’s stock price through the placement of trades at day’s end to “mark the close” of the stock.

You can read the full report for more details here.
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