'Oil Man' Ran Dog & Pony Show, SEC Says
WEST PALM BEACH (CN) - A South Florida man named Ronald Walblay defrauded investors of $12 million by claiming, with no basis for it, that his companies had "millions of barrels of oil" and "billions of cubic feet of natural gas reserves," the SEC claims in court.
The SEC sued Ronald E. Walblay, of Delray Beach, and his companies Ryholland Fielder Inc., and Energy Securities Inc., in Federal Court.
FINRA disciplined Walblay in 2012 from associating with any FINRA member in any capacity for failing to appear for testimony about his companies.
Walblay took more than $12 million from more than 195 U.S. and foreign investors based on his unsubstantiated claims to have access to all that oil and natural gas, the SEC says in the lawsuit.
He pushed his malarkey online, including on YouTube, and promised returns of up to 2,270.71 percent over 15 years, according to the SEC complaint. "These projections lacked any reasonable basis and were based on grossly exaggerated production rates," the SEC says in the lawsuit.
"To date, no investors in any of the offerings have received the return of their principal investment, let alone any profits."
Walblay and his companies failed to use any of the money from four of their "offerings" as they promised to do in the offering memoranda, the SEC says. They used "millions of dollars for travel expenses, investments shows sometimes called 'money shows,' salaries and payroll taxes and professional fees," according to the complaint. They also used money from one offering to pay expenses incurred in a previous offering, the SEC says, the mark of a Ponzi scheme.
The SEC seeks disgorgement, penalties for securities fraud and an injunction.
Walblay's company Ryholland Fielder is managing partner for Basin Oil LP, Basin Oil HV LP, Great Plains Oil LP, and Permian Basin Oil, LP, according to the complaint.