DALLAS (CN) - A North Texas man was sentenced Friday to 30 years in federal prison for a multimillion-dollar oil and gas securities fraud.
David Kevin Lewis was convicted in September 2013 of conspiracy to commit securities fraud and 23 counts of securities fraud.
Lewis, 52 was chairman of Always Consulting, Richardson-based oil and gas well promoter. He conspired to defraud investors in fractional well units in the Rattlesnake Springs drilling program in Osage County, Okla., the U.S. Attorney's Office said in a statement.
Co-defendant Bruce Kyle Griffith, 59, of Dallas, was sentenced in December to 100 months in federal prison.
Griffith was the president and CEO of Always Consulting. He pleaded guilty to conspiracy to commit securities fraud and one count of securities fraud. He also was ordered to pay $2.5 million in restitution.
Co-defendant Thomas Alden Markham Jr., 63, of Plano, also pleaded guilty and was sentenced to 21 months in federal prison. He was ACI's chief of geology and pleaded guilty to misprision of a felony. He was ordered to pay $1.5 million in restitution.
According to the 24-page indictment, the defendants lied to investors about using the money solely to drill, test and complete the wells, but converted the money for themselves through shell entities Davmom Inc. and Diversified Group International, among others.
The defendants also failed to disclose their felony convictions
that Lewis had been convicted of securities fraud in 2000 and ordered to pay $2.2 million in restitution;
that Markham was convicted of mail fraud in 2000 and ordered to pay $395,000 in restitution;
and that Griffith was convicted of bank robbery in 1994 and theft and conspiracy to possess counterfeit bills in 1989.
Twenty-three investors from at least 14 states invested $25,000 to $100,000 apiece in the phony program, from June to August of 2006, according to the indictment. Prosecutors said the defendants falsely promised that Always Consulting would perform all necessary services to complete the Rattlesnake Springs Drilling Program; would use investor money for site preparation, drilling, testing and completion of the Rattlesnake Springs wells; would pay all costs necessary to get the wells into production for approximately $3.5 million; that Always had influence in the Osage Nation in Oklahoma and could acquire oil and gas leases on terms unavailable to others; that pipelines had been laid; and that Griffith began in the oil and gas business in 1985 as a private pilot flying oil executives and equipment to foreign countries.
Lewis was sentenced Friday by U.S. District Judge Sidney A. Fitzwater.
Oil and gas scams are common in Texas and Oklahoma.