Monday, May 16, 2011

Kentucky Lawyer Convicted in Oil and Gas Lease Ponzi Scheme

Kentucky.com reported at the end of last week on the Oil and Gas Lease Ponzi scheme convictions of among others, Lexingotn attorney, Byron Coffman.  Coffman was a former republican candidate for Congress. This is an excerpt from the Kentucky.com report:

"Lexington lawyer Bryan S. Coffman, 47, was found guilty of eight counts of mail fraud, nine counts of wire fraud, two counts of securities fraud, 10 counts of money laundering and one money laundering conspiracy count. He was acquitted on two money laundering charges, according to the U.S. attorney's office. [ . . . ]
Coffman's wife, Megan Coffman, 48, who was facing money laundering charges, was acquitted on all of the charges.

Bryan Coffman and Milby face up to 20 years in prison. U.S. District Judge Karen Caldwell is scheduled to sentence them Aug. 24.  A fourth defendant, Vadim 'Victor' Tsatskin of Canada, testified for the prosecution and was promised he would not be prosecuted in exchange for his testimony.

Authorities said about 500 corporate and individual investors in several states and countries were promised big returns from wells in Green and Adair counties that were actually dry holes or wells that didn't produce as long as promised. The defendants intentionally misrepresented and omitted facts about their oil and gas drilling programs, prosecutors maintained. The defendants gave investors false information about the use of investor money, investor risk, successes of their previous drilling programs and their companies' compliance with federal laws, according to the prosecution.

The oil and gas production investment scheme, which used the company names Mid-America Energy Inc. and Global Energy Group, began in 2004 and lasted through 2008, according to prosecutors.   The defendants were accused of fraudulently using investors' money for things such as jewelry, real estate, a lavish birthday party, a yacht and retirement accounts."
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Ponzi scheme defendants populated FCI, Morgantown's White Collar Criminal Elite.  In my residential unit the guy who ran gambling was an OurTown Ponze schemer.  When not running the "floating poker" game, he occupied his time watching the CNBC stock ticker--apparently the feds did not seize all of his assets. 

A friend who works in the law office, here, in OurTown lost her life savings to a real estate Ponzi scheme run by a crook she met through her church.  The investment scam  purported to build houses near Phoenix, Az.  While it's not the purpose of this post to analyze that scheme it's not lost on me that the chaos in Maricopa County created a vacuum that contributed to or enabled the scheme that cost my friend and her family their retirement. 

5 comments:

  1. Our Government has a 90% Plus conviction rate---(Google "federal conviction rate")
    To fight the Government by going to trial when you believe you are not guilty of the charges is becoming an absolute rarity---especially one like Mr. Coffman went through. The Government raided his law office with a purported "taint team"--however everything was handed to the prosecutor first---and the judge held a multi-day hearing to try and "correct" the problem. Out of thousands of documents, less than 10 were found to be attorney client privileged.
    Whatever YOU think is privileged? It most likely is not. This is just one of several issues that was fought pre-trial. (To see how hard the battle was---Use Google, go to More---click on Scholar--type in Bryan Coffman) To convice Coffman to plead guilty--they continually threatened his wife---then Actually Went Through with It, when he refused. His wife was forced to go through the 3 week trial with him, where she WAS acquitted, because the charges against her were bogus, and the Government knew it.
    Milby was Coffman's Client--and the SEC did an extensive investigation of Milby--including contact with Coffman--but did not find Coffman culpable for anything. (Google SEC/Milby). Sure, everyone cries that their trial was "unfair" when they are found guilty,
    but this case Will be Going to Appeal.
    Also note---neither Coffman nor Milby were ever arrested. They appeared at all times on their own recognizance, and remain out on bond. One final note---contracts to drill oil wells were signed, contracts DID note to investors that oil speculation was risky, and the oil wells Were drilled. But they did not meet Milby's glowing verbal representations.
    (compare the paucity of details on the press release post trial to other Gov press releases--note how there are almost no details of "who did what")

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    1. Federal agents entered the home of Bryan Coffman's sister in law, guns out. They expected to find a "boiler room" and arrest the sister. No such thing was found. A few of the police officers who were there even said "sorry, ma'am to the lady upon exiting. The lady in question later received summons to appear in court, to testify FOR THE PROSECUTION.

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  2. Thank you for supplying details.

    As you will notice if you read the posts at Bad Lawyer, the anonymous blawger went through some of this process and relates strongly to all these stories. You might wish to look at the posts on Morgantown for pertinent information.

    Good luck, Anon.

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    ReplyDelete
  4. Yes, I agree michel swanston of gatineau quebec is probably the worst lawyer I have ever heard of.

    ReplyDelete