Former CEO fined in Ponzi scheme
Dec 01, 2012 (Menafn - The Oklahoman - McClatchy-Tribune Information Services via COMTEX) --A federal judge in Tulsa has ordered the former CEO of an oil and natural gas company behind a multimillion-dollar Ponzi scheme to pay nearly 500,000 in fines and forfeitures.
Brian D. Fox, the former chief executive of Powder River Petroleum International Inc., maintains he did nothing wrong, even though he signed off on a judgment against him that had been sought by the U.S. Securities and Exchange Commission.
Powder River had been accused of defrauding investors in Asia out of more than 38 million, promising a 9 percent annual return on working interests in oil and natural gas properties in several states.
Authorities said Fox created a Ponzi scheme by paying existing obligations from new investments.
The company was based in Calgary, Canada, but authorities alleged it conducted its investor-related activities from an office in Tulsa.
U.S. District Judge Claire V. Eagan on Nov. 2 ordered Fox to forfeit 320,000 he received as a bonus in 2007 based on inflated income reports, plus almost 60,000 in interest. Fox also must pay a 100,000 fine.
Fox, who declined to comment, filed paperwork Friday asking the judge to reconsider her ruling, claiming he was the victim of a "slander campaign" by Oklahoma City attorney Bruce Day after an unsuccessful takeover attempt by a former Powder River board member.
Day, who was appointed as receiver of Powder River's assets, said he was pleased that the judge levied a fine against Fox in the securities case, but he would still like to see him prosecuted for his actions.
Day said none of Powder River's investors has been repaid.
The company did not have any significant assets when he got involved with the case in 2008, Day said. There was not even enough money to pay severance to Powder River's employees, including Fox's daughter, when they were let go.
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