James VanBlaricum, a 77-year-old businessman from Colleyville, Texas, has pleaded guilty to mail fraud in a high-profile Ponzi scheme case.
According to court documents, VanBlaricum operated Signal Oil and Gas Company (SOG) and Texas Energy Management, which later became Texas Energy Mutual (TEM), and raised millions of dollars from investors by selling securities in the form of joint ventures in ‘programs’ offered by the companies.
VanBlaricum employed sales agents who worked on his behalf to raise money, by selling limited partnership interests in these ‘programs’ offered by SOG and TEM. Both personally and through investors, VanBlaricum deceived investors and potential investors by misrepresenting material facts.
The scheme involved VanBlaricum representing that investors would earn an ‘assured’ rate of return on their initial investment, and they would receive a full refund of their initial investment amount after a defined period of time. He also represented that he intended to use a certain percentage of investors’ money to purchase mineral leases, and oil and gas well projects, when in fact, he intended to spend a substantially smaller percentage on the leases and oil and gas well projects and use a substantial part of investors’ money for purposes they did not authorize or even know about.
VanBlaricum also represented that he had purchased certain assets, or was in the process of purchasing them, when in fact, he had not purchased the assets and was not in the process of purchasing them. He also represented that the oil and gas well projects were productive and profitable, when in fact, most were ‘dry holes,’ produced oil for a short period of time, or had not been drilled.
VanBlaricum, who has been in custody since his arrest in mid-August 2016, is set to be sentenced on June 13, 2017. The U.S. Postal Inspection Service assisted in the investigation, which revealed that VanBlaricum used various means to deceive investors, including using a false name to identify himself to investors, and causing funds to be transferred to, withdrawn from, and deposited into various accounts to create the appearance of business operations and revenue that he knew did not exist.
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Key Facts
- State: Texas
- Category: Fraud & Financial Crimes
- Source: DOJ Press Release â†â€â€
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