SEC Charges Couch Oil & Gas in $10 Million Scheme
On May 12, 2014, the Securities and Exchange Commission (the “SEC”) filed suit in United States District Court in Dallas, Texas, alleging that, from at least September 2010 through January 2012, Charles O. Couch of Irving, Texas and his company Couch Oil & Gas, Inc. fraudulently raised approximately $9,800,000 from more than 200 investors in two unregistered offerings of oil and gas securities.
The SEC’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.
According to the SEC, 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 SEC is seeking permanent injunctions, disgorgement with prejudgment interest, and civil penalties against each defendant.
For further information about this securities law blog post, please contact Brenda Hamilton, Securities Attorney at 101 Plaza Real S, Suite 202 N, Boca Raton, Florida, (561) 416-8956, by email at [email protected] or visit www.securitieslawyer101.com. This securities law blog post is provided as a general informational service to clients and friends of Hamilton & Associates Law Group and should not be construed as, and does not constitute, legal and compliance advice on any specific matter, nor does this message create an attorney-client relationship. For more information about going public and the rules and regulations affecting the use of Rule 144, Form 8K, crowdfunding, FINRA Rule 6490, Rule 506 private placement offerings and memorandums, Regulation A, Rule 504 offerings, SEC reporting requirements, SEC registration statements on Form S-1 , IPO’s, OTC Pink Sheet listings, Form 10 OTCBB and OTC Markets disclosure requirements, DTC Chills, Global Locks, reverse mergers, public shells, direct public offerings and direct public offerings please contact Hamilton and Associates at (561) 416-8956 or [email protected]. Please note that the prior results discussed herein do not guarantee similar outcomes.
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