SEC v. Carol J. Wayland; John C. Mueller; Kentucky-Tennessee 50 Wells/400 BBLPD Block, Limited Partnership; HP Operations, LLC; C.A.R. Leasing, LLC; Mitchell B. Dow, et al., No. LR-23876, Central District of California (July 7, 2017) — Press Release
raw: Carol J. Wayland, John C. Mueller, Kentucky-Tennessee 50 Wells/400 BBLPD Block, Limited Partnership, HP Operations, LLC, C.A.R. Leasing, LLC, Mitchell B. Dow, Barry Liss, and Steve G. Blasko
Carol J. Wayland, John C. Mueller, Kentucky-Tennessee 50 Wells/400 BBLPD Block, Limited Partnership, HP Operations, LLC, C.A.R. Leasing, LLC, Mitchell B. Dow, Barry Liss, and Steve G. Blasko, No. 8:17-cv-01156 (July 7, 2017)
Carol J
Carol J. Wayland, John C. Mueller, and their entities, including Kentucky-Tennessee 50 Wells/400 BBLPD Block, Limited Partnership, are accused of a $2.4 million offering fraud. The alleged fraud involved selling unregistered securities to 41 investors nationwide through a boiler room operation, with at least $871,463 misappropriated for personal expenses and Ponzi payments. The defendants are charged with violating various sections of the Securities Act of 1933 and the Securities Exchange Act of 1934. The outcome is pending, with the SEC seeking permanent injunctions, disgorgement, prejudgment interest, and civil penalties.
Carol J. Wayland, John C. Mueller, and their entities, including Kentucky-Tennessee 50 Wells/400 BBLPD Block, Limited Partnership, are accused of a $2.4 million offering fraud. The alleged fraud involved selling unregistered securities to 41 investors nationwide through a boiler room operation, with at least $871,463 misappropriated for personal expenses and Ponzi payments. The defendants are charged with violating various sections of the Securities Act of 1933 and the Securities Exchange Act of 1934. The outcome is pending, with the SEC seeking permanent injunctions, disgorgement, prejudgment interest, and civil penalties. The U.S. Securities and Exchange Commission charged Carol J. Wayland, her son John C. Mueller, their entities Kentucky-Tennessee 50 Wells/400 BBLPD Block, Limited Partnership, HP Operations, LLC, and C.A.R. Leasing, LLC, along with three salespeople—Mitchell B. Dow, Barry Liss, and Steve G. Blasko—with orchestrating a $2.4 million fraud through an unregistered oil well offering. The defendants operated a boiler room under the fictitious “Sahara Wealth Advisors,” misrepresenting the venture’s legitimacy, experience, and projected returns while diverting at least $871,463 (36% of investor funds) for personal expenses and Ponzi-style payments. The SEC alleged violations of anti-fraud provisions under the Securities Act and Exchange Act, as well as unregistered securities sales and unlicensed brokerage activity. The complaint seeks permanent injunctions, disgorgement with interest, and civil penalties against all defendants. The case was filed in the Central District of California on July 6, 2017. The U.S. Securities and Exchange Commission (SEC) filed charges against Carol J. Wayland, John C. Mueller, and several affiliated entities and individuals, including Kentucky-Tennessee 50 Wells/400 BBLPD Block, Limited Partnership (K-T 50 Wells), HP Operations, LLC, C.A.R. Leasing, LLC, Mitchell B. Dow, Barry Liss, and Steve G. Blasko, in connection with a $2.4 million securities fraud. From May 2014 to February 2016, K-T 50 Wells, which was founded and operated by Wayland and Mueller, allegedly sold unregistered securities through a boiler room operation, misappropriating at least $871,463 of investor funds for personal expenses and Ponzi scheme payments. The SEC alleges violations of multiple securities laws, including misrepresentations about the company's operations and returns, and seeks permanent injunctions, disgorgement, and civil penalties. The case was filed in the U.S. District Court for the Central District of California.
Exhibits & Attached Documents (1)
Extracted insights
- $2.40M $2.4 million $1M–$10M
- $871K $871,463 $100K–$1M
- person barry liss
- agency by the u.s. securities and exchange commission
- company c.a.r. leasing, llc
- person carol j. wayland
- company hp operations, llc
- person john c. mueller
- person mitchell b. dow
- agency Securities and Exchange Commission
- person steve g. blasko
- SEC filed litigation Carol J. Wayland, John C. Mueller, Kentucky-Tennessee 50 Wells/400 BBLPD Block, Limited Partnership, HP Operations, LLC, C.A.R. Leasing, LLC, Mitchell B. Dow, Barry Liss, and Steve G. Blasko
- Carol J. Wayland charged by the U.S. Securities and Exchange Commission
- John C. Mueller charged by the U.S. Securities and Exchange Commission
- Kentucky-Tennessee 50 Wells/400 BBLPD Block, Limited Partnership charged by the U.S. Securities and Exchange Commission
- HP Operations, LLC charged by the U.S. Securities and Exchange Commission
- C.A.R. Leasing, LLC charged by the U.S. Securities and Exchange Commission
- Mitchell B. Dow charged by the U.S. Securities and Exchange Commission
- Barry Liss charged by the U.S. Securities and Exchange Commission
- Steve G. Blasko charged by the U.S. Securities and Exchange Commission
- U.S. Securities and Exchange Commission filed Litigation Release No. 23876
- U.S. Securities and Exchange Commission announced on July 7, 2017
U.S. SECURITIES AND EXCHANGE COMMISSION Litigation Release No. 23876 / July 7, 2017 Securities and Exchange Commission v. Carol J. Wayland, John C. Mueller, Kentucky-Tennessee 50 Wells/400 BBLPD Block, Limited Partnership, HP Operations, LLC, C.A.R. Leasing, LLC, Mitchell B. Dow, Barry Liss, and Steve G. Blasko, No. 8:17-cv-01156 (C.D. Cal. filed July 6, 2017) SEC Announces Charges in Oil Well Offering Fraud The Securities and Exchange Commission announced charges against a purported oil well company, its founders, and three salespeople in connection with a $2.4 million offering fraud. The SEC's complaint, filed in U.S. District Court for the Central District of California, alleges that from approximately May 2014 to February 2016, Kentucky-Tennessee 50 Wells/400 BBLPD Block, Limited Partnership (K-T 50 Wells) fraudulently offered and sold unregistered securities to investors using a boiler room operation, raising approximately $2.4 million from 41 investors nationwide. The complaint further alleges that Carol J. Wayland and her son, John C. Mueller, founded and operated K-T 50 Wells and conducted the offering through two other entities that they owned and controlled, HP Operations, LLC and C.A.R. Leasing, LLC. To solicit investors, Wayland and Mueller allegedly set up a boiler room under the fictitious name of "Sahara Wealth Advisors" where they employed numerous salespeople, including Mitchell B. Dow, Barry Liss, and Steve G. Blasko, all of whom allegedly had prior experience working in boiler rooms. According to the SEC's complaint, K-T 50 Wells was supposed to develop and operate oil wells, but had little legitimate business activity. Wayland and Mueller allegedly misappropriated K-T 50 Wells investor money for purposes not disclosed in the K-T 50 Wells private placement memorandum, taking at least $871,463, or 36%, to pay for their personal expenses, and using investor money to make Ponzi payments to certain other K-T 50 Wells investors. The complaint also alleges that K-T 50 Wells made misrepresentations regarding Wayland and Mueller's experience managing oil and gas investment projects, as well as the amount of returns that investors would receive. The SEC's complaint charges K-T 50 Wells, HP Operations, C.A.R. Leasing, Wayland, and Mueller with violating Sections 17(a)(1) and (3) of the Securities Act of 1933 and Section 10(b) of the Securities Exchange Act of 1934 and Rules 10b-5(a) and (c) thereunder and charges K-T 50 Wells, HP Operations, Wayland, and Mueller with violating Section 17(a)(2) of the Securities Act. The complaint also charges Wayland and Mueller as control persons of certain of the entity defendants. In addition, the complaint charges K-T 50 Wells, HP Operations, C.A.R. Leasing, Wayland, Mueller, Dow, Liss, and Blasko with violating Sections 5(a) and 5(c) of the Securities Act and charges Wayland, Mueller, Dow, Liss, and Blasko with violating Section 15(a) of the Exchange Act. The complaint seeks permanent injunctions, disgorgement plus prejudgment interest, and civil penalties against all of the defendants. The SEC's investigation was conducted by Marisa G. Westervelt and Lorraine L. Pearson and supervised by Victoria A. Levin and Rhoda Chang of the Los Angeles Regional Office. The SEC's litigation will be led by Lynn Dean. SEC Complaint
U.S. SECURITIES AND EXCHANGE COMMISSION Litigation Release No. 23876 / July 7, 2017 Securities and Exchange Commission v. Carol J. Wayland, John C. Mueller, Kentucky-Tennessee 50 Wells/400 BBLPD Block, Limited Partnership, HP Operations, LLC, C.A.R. Leasing, LLC, Mitchell B. Dow, Barry Liss, and Steve G. Blasko, No. 8:17-cv-01156 (C.D. Cal. filed July 6, 2017) SEC Announces Charges in Oil Well Offering Fraud The Securities and Exchange Commission announced charges against a purported oil well company, its founders, and three salespeople in connection with a $2.4 million offering fraud. The SEC's complaint, filed in U.S. District Court for the Central District of California, alleges that from approximately May 2014 to February 2016, Kentucky-Tennessee 50 Wells/400 BBLPD Block, Limited Partnership (K-T 50 Wells) fraudulently offered and sold unregistered securities to investors using a boiler room operation, raising approximately $2.4 million from 41 investors nationwide. The complaint further alleges that Carol J. Wayland and her son, John C. Mueller, founded and operated K-T 50 Wells and conducted the offering through two other entities that they owned and controlled, HP Operations, LLC and C.A.R. Leasing, LLC. To solicit investors, Wayland and Mueller allegedly set up a boiler room under the fictitious name of "Sahara Wealth Advisors" where they employed numerous salespeople, including Mitchell B. Dow, Barry Liss, and Steve G. Blasko, all of whom allegedly had prior experience working in boiler rooms. According to the SEC's complaint, K-T 50 Wells was supposed to develop and operate oil wells, but had little legitimate business activity. Wayland and Mueller allegedly misappropriated K-T 50 Wells investor money for purposes not disclosed in the K-T 50 Wells private placement memorandum, taking at least $871,463, or 36%, to pay for their personal expenses, and using investor money to make Ponzi payments to certain other K-T 50 Wells investors. The complaint also alleges that K-T 50 Wells made misrepresentations regarding Wayland and Mueller's experience managing oil and gas investment projects, as well as the amount of returns that investors would receive. The SEC's complaint charges K-T 50 Wells, HP Operations, C.A.R. Leasing, Wayland, and Mueller with violating Sections 17(a)(1) and (3) of the Securities Act of 1933 and Section 10(b) of the Securities Exchange Act of 1934 and Rules 10b-5(a) and (c) thereunder and charges K-T 50 Wells, HP Operations, Wayland, and Mueller with violating Section 17(a)(2) of the Securities Act. The complaint also charges Wayland and Mueller as control persons of certain of the entity defendants. In addition, the complaint charges K-T 50 Wells, HP Operations, C.A.R. Leasing, Wayland, Mueller, Dow, Liss, and Blasko with violating Sections 5(a) and 5(c) of the Securities Act and charges Wayland, Mueller, Dow, Liss, and Blasko with violating Section 15(a) of the Exchange Act. The complaint seeks permanent injunctions, disgorgement plus prejudgment interest, and civil penalties against all of the defendants. The SEC's investigation was conducted by Marisa G. Westervelt and Lorraine L. Pearson and supervised by Victoria A. Levin and Rhoda Chang of the Los Angeles Regional Office. The SEC's litigation will be led by Lynn Dean. SEC Complaint