|
U.S.
SECURITIES AND EXCHANGE COMMISSION
LITIGATION RELEASE NO. 15822
SECURITIES AND EXCHANGE COMMISSION V. ENVIRONMENTAL ENERGY,
INC.; ENVIRONMENTAL OPERATING, INC.; IRVINE SECURITIES,
INC.; LARRY R. CROWDER; JOHN R. POWELL; CHRISTIAN R.
HIGGINS; CHARLES L. POWELL; JAMES P. GALLAHER; DALE J.
ENGELHARDT; AND TREY L. FRIEDMANN Civil Action No. 98-6060-
CM (BQRx) (C.D. Cal.)
The Securities and Exchange Commission ("Commission")
announced today that on July 28, 1998, it filed a Complaint
in the United States District Court for the Central District
of California charging seven individuals and three
businesses from Orange County, California
("Defendants")
with securities fraud in a multi-million dollar scheme
concerning oil and gas partnerships ("Partnerships").
Named in the Complaint are: Larry R. Crowder
("Crowder"),
age 40, residing in Coto de Caza, California; John R. Powell
("Powell"), age 40, residing in Laguna Beach,
California;
and three Irvine, California based businesses --
Environmental Energy, Inc. ("EEI"), Environmental
Operating,
Inc. ("EOI") and Irvine Securities, Inc. ("Irvine
Securities"). Also named in the Complaint are five
securities salesmen: Christian R. Higgins ("Higgins"),
age
22, residing in Newport Beach, California; Charles L. Powell
("C. Powell"), age 45, residing in Huntington Beach,
California; James P. Gallaher ("Gallaher"), age 44,
residing
in San Juan Capistrano, California; Dale J. Engelhardt
("Engelhardt"), age 33, residing in Trabuco Canyon,
California; and Trey L. Friedmann ("Friedmann"), age
33,
residing in Costa Mesa, California.
According to the Complaint, from 1993 to the present,
Crowder and Powell developed and ran the Partnership scheme
through EEI, EOI and Irvine Securities, raising $15.7
million from over 600 investors nationwide. Partnership
offering documents provided to investors represented that
large percentages of the investor funds would be used to
acquire oil and gas interests, and the offering documents
sometimes explicitly stated that these acquisition
transactions would be between EEI (directly or through an
affiliate) and that EEI would make a profit on the
transaction. The offering documents, however, do not
adequately disclose the extent of the profit that EEI made
on the acquisition transactions. The Complaint alleges
that, in fact, EEI made massive profits that ranged from at
least 159% to over 64,000% of the amount that EEI paid.
Crowder, Powell, EOI and Irvine Securities also represented
to investors that certain oil and gas interests would be
purchased when, in fact, Crowder and Powell knew that they
had lost the right to purchase those interests because their
option contract had expired.
The Complaint further alleges that the salesmen made
material misrepresentations in their solicitations to
investors by inflating the expected return on investment,
overstating the actual return on investment, misrepresenting
that they themselves had invested in the Partnerships (they
had not) and misrepresenting the status of a related utility
that was to buy gas produced from the Partnerships.
The Commission seeks permanent injunctions and civil
penalties against all of the Defendants. It also seeks
disgorgement of ill-gotten gains and prejudgment interest
against Crowder, Powell, EEI and EOI.
The Commission charged Crowder, Powell, EEI, EOI, and Irvine
Securities with violations of Sections 5(a), 5(c) and 17(a)
of the Securities Act of 1933 ("Securities Act") and
Section
10(b) of the Securities Exchange Act of 1934 ("Exchange
Act") and Rule 10b-5 thereunder. The Commission
additionally charged Irvine Securities with violations of
Section 15(c) of the Exchange Act and Rule 15c1-2
thereunder. The Commission charged Higgins, C. Powell,
Gallaher and Engelhardt with violations of Section 17(a) of
the Securities Act and Section 10(b) of the Exchange Act and
Rule 10b-5 thereunder. Finally, the Commission charged
Friedmann with violations of Sections 17(a) of the
Securities Act and Section 15(a) of the Exchange Act.
REPORT-Securities-Fraud-Now@securitiesfraud.org
Do
you like our Internet
Domain Name? You
can get your very own Internet Domain name for under 10
bucks. Yes Under Ten dollars and you can own your very own
domain
name on the world wide web!
For the Best in Las
Vegas VIP style treatment contact Key VIP.
Hosting
Services Donated by BiCoastal Hosting
Voice
Message Broadcasting - Bulk voice mail deliveries to
answering machines and interactive voice response (ivr) to live
answers, drive sales, branding, web site traffic via our
automated voice broadcasting system or auto dialer.
Covert Spy Shop
dot com your only online resource for spy
gear and equipment.
|
About Us