{"id":547,"date":"2009-07-26T18:52:47","date_gmt":"2009-07-26T18:52:47","guid":{"rendered":"https:\/\/www.stockbrokerfraudblog.com\/2009\/07\/provident_royalties_faces_485"},"modified":"2022-03-09T15:54:30","modified_gmt":"2022-03-09T21:54:30","slug":"provident-royalties-faces-485","status":"publish","type":"post","link":"https:\/\/www.investorlawyers.com\/blog\/provident-royalties-faces-485\/","title":{"rendered":"Provident Royalties Faces $485 Million Texas Securities Fraud, Says SEC"},"content":{"rendered":"

\t\t\t\tThe US Securities and Exchange Commission has charged Provident Royalties, LLC, Provident Asset Management LLC, and founders Brendan Coughlin, Paul Melbye, and Henry Harrison with Texas securities fraud<\/a> over their alleged involvement in a $485 million investment scam. The SEC claims the defendants used the ponzi scheme<\/a> to defraud thousands of natural gas and oil investors.<\/p>\n

According to the SEC civil complaint, Provident allegedly made a series of fraudulent offerings of limited partnership interests and preferred stock from at least June 2006 through January 2009 and persuaded about 7,700 US investors to invest half a billion dollars. The Texas-based firm allegedly promised yearly returns of more than 18% and misrepresented the way the funds were going to be used. The SEC is also accusing broker-dealer Provident Asset Management, LLC of making direct retail securities sales, as well as soliciting unaffiliated retail broker-dealers to submit placement agreements for each offering.<\/p>\n

The SEC contends that investors thought that 86% of the funds would be used in gas and oil investments, mineral rights, leases, exploration, and development. While less than 50% of the investors’ funds were actually used to acquire and develop gas and oil exploration, the SEC claims the other funds were used to pay previous investors of Provident Royalties. <\/p>\n

Coughlin, Harrison, and Melbye have been charged with orchestrating the ponzi scam. Also named in the SEC complaint are the 21 entities that sold securities to investors. <\/p>\n

The SEC is charging the defendants with violating the Securities Exchange Act of 1934, Rule 10b-5 thereunder, and the Securities Act of 1933. The SEC is seeking preliminary and permanent injunctions, a temporary restraining order, financial penalties, and disgorgement of ill-gotten gains in addition to prejudgment interest. An emergency freeze on the assets has been issued and a receiver has been appointed. <\/p>\n

Related Web Resources:<\/strong>
\nSEC Obtains Asset Freeze in $485 Million Nationwide Offering Fraud<\/a>, SEC, July 7, 2009
\nRead the SEC Complaint<\/a> (PDF)
\n Continue Reading \u203a<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

The US Securities and Exchange Commission has charged Provident Royalties, LLC, Provident Asset Management LLC, and founders Brendan Coughlin, Paul Melbye, and Henry Harrison with Texas securities fraud over their alleged involvement in a $485 million investment scam. The SEC claims the defendants used the ponzi scheme to defraud thousands of natural gas and oil […]<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"jetpack_post_was_ever_published":false,"footnotes":""},"categories":[3774,3752,3792,3900,3750],"tags":[],"class_list":["post-547","post","type-post","status-publish","format-standard","hentry","category-broker-dealers","category-financial-firms","category-ponzi-scams","category-provident-asset-management","category-texas-securities-fraud"],"yoast_head":"\nProvident Royalties Faces $485 Million Texas Securities Fraud, Says SEC — Investor Lawyers Blog — July 26, 2009<\/title>\n<meta name=\"description\" content=\"The US Securities and Exchange Commission has charged Provident Royalties, LLC, Provident Asset Management LLC, and founders Brendan Coughlin, Paul — July 26, 2009\" \/>\n<meta name=\"robots\" content=\"index, follow, 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