SEC Wants Lawyer to Pay $2.5M Penalty in Texas Securities Case

The U.S. Securities and Exchange Commission has filed a motion for summary judgment in its case against Gregory Jones. The Texas lawyer is facing civil charges accusing him of defrauding investors in two securities offerings, including a fracking water filtration deal and an oil and gas exploration venture.

Now, the SEC wants Jones to pay a $2.5M civil penalty, disgorgement of $985K, further disgorgement of $480K, and $17K in prejudgment interest.

The regulator, in its original complaint that it submitted last year, claims that Jones represented Swiss and French investors who invested about $6M in Edwards Exploration. The attorney had a deal with the company in which he would get paid for providing due diligence related to the investors’ shares. The fees he received under the agreement were about $480K. However, claims the Commission, Jones did not tell investors that the money came from their principal cash.

The SEC also says that from ’13 through at least ’14, Jones sold and offered securities that were put out by Aquaphex, which was supposedly a business that was involved in recycling fracking water. He raised about $64K from nine investors. However, contends the Commission, the investment documents for the company included false statements, including a claim that investors could end up making over 115% a year on the securities the they bought.

In 2014, Jones was sued by a number of companies related to the purchase of interests in companies belonging to Spencer Edwards. The plaintiff said that they hired him because he represented that he knew Edwards and was familiar with his Wyoming business ventures. They claim to have lost $6.7M in what proved to be a Ponzi scam.

Contact our Texas securities law firm today.

SEC Says Atty In Fracking Fraud Can’t Evade $2.5M Penalties, Law360, January 7, 2016
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