Securities Fraud Case Leads to 15 Convictions

Posted: Updated:
NEW ALBANY -

More than a dozen people have been convicted and sentenced to prison in a securities fraud case out of New Albany. The office of Indiana Secretary of State Connie Lawson says the case surrounds Earth Energy Exploration Inc., which bilked investors out of millions of dollars.

Lawson's office says it began in 2007 when David Rose founded Earth Energy Exploration, which promised victims to invest their money in oil exploration and production companies. Instead, the money was used for personal expenses of the company's employees and laundered into related businesses.

Our partners at WIBC-FM in Indianapolis report 10 investors were swindled out of a total of $3 million. 

"It took my team years to uncover the true nature of the scheme,” said Lawson. "This was homegrown organized crime that spread through 9 states with a base in New Albany, Indiana. The convoluted scheme used Wyoming as a mail drop and Indiana as a base for calls, with investors stretching from Pennsylvania to Texas."

Rose and his partners, Lawson says, would use the money to try and increase their income through several ventures, including the creation of an adult film company. When the ventures failed, they would send employees to Las Vegas to try and recoup some of their losses through gambling, which also failed.

Rose pleaded guilty to securities fraud and was sentenced to 8 years, four of which will be served in prison. The others received prison sentences of one to six years.

"This case should serve as a reminder that all potential investors should call the Secretary of State’s office to verify an investment advisor and the investment are registered and that potential defendants who want to prey on investors should be aware they will be prosecuted and held accountable," said Floyd County Prosecutor Keith Henderson.  

The 15 people convicted in the case include:

  • Thomas Berry provided assistance to Brian Rose and pled guilty to corrupt business influence. Berry was sentenced to 4 years, 1.5 to be served in prison and 2.5 on probation.
  • David Brown was a sales closer and pled guilty to aiding the sale of unregistered securities. Brown was sentenced to 4 years in prison.
  • Richard Collins was a sales closer and pled guilty to aiding the sale of unregistered securities.  Collins was sentenced to 6 years in prison.
  • Bruce Fox was a president of Earth Energy Exploration, Inc. and pled guilty to securities fraud and the sale of an unregistered security.  Fox was sentenced to 6 years in prison and returned $5000 to victims.
  • Brent Loveall acted as a sales closer and pled guilty to acting as an unregistered broker-dealer.  Loveall was sentenced to 6 years in prison.
  • Robert McGregor was a sales closer and pled guilty to the sale of unregistered securities.  McGregor was sentenced to 4 years with 18 months of probation.
  • Keith Mohney was a CPA and the Earth Energy Exploration, Inc. tax preparer.  He pled guilty to aiding the sale of unregistered securities. Mohney was sentenced to 4 years with 4 years of probation.
  • Colin Purcell pled guilty to aiding securities fraud.  Purcell was sentenced to 3 years with 3 years of probation and returned $5000 to victims.
  • Brian Rose, an owner of Earth Energy Exploration, Inc, pled guilty to securities fraud and corrupt business influence.  Brian Rose was sentenced to 8 years in prison with 2 years’ probation and returned $25,000 to victims.
  • David Rose, who was a leader of the scheme, pled guilty to securities fraud and was sentenced to 8 years, 4 of which will be executed in prison.
  • Hugh Sackett was a sales consultant and pled guilty to aiding the sale of unregistered securities. Sackett was sentenced to 4 years in prison with 2 years of probation and returned $6000 to victims.
  • Jeffery Smith laundered money for Brian Rose and pled guilty to conversion. He was sentenced to 1 year and returned $1000 to victims.
  • Jason Towe was a sales closer and a president of Earth Energy Exploration, Inc, he pled guilty to corrupt business influence. Towe was sentenced to 4 years with 4 years of probation and returned $15,000 to victims.
  • Mandy Ward-Rose ran a small pornography company and wrote investment paperwork for Earth Energy Exploration, Inc.  She pled guilty to theft and was sentenced to 3 years, while returning $22,000 to victims.
  • Michael Wood was a president of an Earth Energy Exploration, Inc affiliate company and pled guilty to aiding the sale of unregistered securities.  Wood was sentenced to 4 years in prison.
  • Perspectives

    • How to Find a New Audience After Hitting a Marketing Plateau

      It may sound like a marketer’s dream scenario: efforts have proven to be so successful it appears a company has completely saturated their target audience. While it may be a good problem to have, it still may be a problem. Hitting a marketing plateau is an opportunity for companies in any industry to reevaluate, re-energize and come to the table with new ideas for better understanding existing customers and engaging new audiences.

    More

Subscribe

Name:
Company Name:
Email:
Confirm Email:
HTML
INside Edge
Morning Briefing
BigWigs & New Gigs
Life Sciences Indiana
Indiana Connections
INPower
Subscribe
Unsubscribe

Events



  • Most Popular Stories

    • (image courtesy of The Times of Northwest Indiana)

      Crews Start Demolition of Carson's in Hammond

      The face of downtown retail in Hammond is changing once again with the demolition of Carson’s department store, the one-time the anchor of Woodmar Mall. Our partners at The Times of Northwest Indiana report excavating crews have started to demolish the last vestige of the shopping center which stood since the 1950s. 

    • Shaina Keck

      Pier 48 Manager Named

      FK Restaurant Group has named Shaina Keck sales and banquet manager for Pier 48 Fish House and Bar in downtown Indianapolis. She previously served in sales at Kilroy's Bar & Grill. Keck is a graduate of Indiana University Kelly School of Business with a bachelor of science degree in finance and accounting with a concentration in international studies.  
    • (image courtesy of The Times of Northwest Indiana)

      U.S. Steel Cuts Jobs, Low Price Imports Partially to Blame

      Pittsburgh-based U.S. Steel has announced it will idle its tin mill operations in East Chicago, affecting nearly 300 workers, half of which will lose their jobs. Our partners at The Times of Northwest Indiana report U.S. Steel blames the layoffs on the Del Monte food company which announced its own mass layoffs. 

    • Lucy Schaich

      City of Bloomington Promotes Schaich

      The city of Bloomington has promoted Lucy Schaich to volunteer network coordinator, a program of the Community and Family Resources Department.  She served as assistant coordinator from 2000 until 2018, when she became the volunteer network’s interim director. Schaich is a graduate of Indiana University. 

    • Gas City Startup Helping Hemp Farmers

      Last month, it became legal for Hoosier farmers to grow hemp and a Gas City-based startup is being aggressive in being among the first to take advantage of market opportunities. Heartland Harvest Processing is helping farmers connect the new agricultural commodity to consumer products, including CBD. Founder and Chief Marketing Officer Chris Moorman says the first hemp harvest under the new law is expected to begin next month. In an interview with Business of Health...