Last week, Mark Cornell "pleaded guilty to securities fraud in U.S. District Court in Eastern Kentucky, admitting his role in a scheme that defrauded investors out of $3 million," Justin Story reports for the Bowling Green Daily News. Cornell acknowledged acting as operator of oil wells in southern Kentucky "while others sold investments in the wells.
Court records show his co-defendants misled investors with false information about the wells to make it appear they were producing substantial amounts of oil."
Several similar cases returned guilty pleas in recent years, and several more cases are pending. Southern Kentucky has long been known as a “promoter’s paradise” because its oil production comes mainly from shallow wells that produce strongly at first but quickly decline.
Bowling Green attorney John Caudill told Story, “Frequently, what you get is an operator that advertises on the Internet that they have a very lucrative prospect . . . what typically happens is there’s no prospect at all. It seems very lucrative unless you do your due diligence and look into the prospect, but unfortunately, some people don’t, and they wire large sums of money as investors in exchange for a royalty interest in the project.”
 |
| Kentucky Geological Survey map (TORIS is tertiary recovery) |
Bowling Green attorney John Caudill told Story, “Frequently, what you get is an operator that advertises on the Internet that they have a very lucrative prospect . . . what typically happens is there’s no prospect at all. It seems very lucrative unless you do your due diligence and look into the prospect, but unfortunately, some people don’t, and they wire large sums of money as investors in exchange for a royalty interest in the project.”
No comments:
Post a Comment