SEC Froze Assets Of Provident Royalties

Wednesday, July 8, 2009, 1:08 AM | Leave Comment

The Securities and Exchange Commission has obtained an emergency asset freeze in a $485 million offering fraud and Ponzi scheme orchestrated by three Dallas businessmen through a company they owned and controlled, Provident Royalties LLC.

The SEC alleges that from at least June 2006 through January 2009, Provident made a series of fraudulent securities offerings involving oil and gas assets through 21 affiliated entities to more than 7,700 investors throughout the United States.

In a lawsuit filed in a Texas federal court, the SEC said that Provident Royalties LLC made fraudulent securities offerings involving oil and gas assets between June 2006 and January 2009 to more than 7,700 investors.

The suit names Provident Royalties, as well as its three founding members: Paul Melbye, 44; Brendan Coughlin, 43; and Henry Harrison, 44. The suit also names Provident’s brokerage arm, Provident Asset Management LLC, and 21 of the company’s entities that offered and sold securities.

Thomas Melton, a senior regional trial counsel for the SEC, said the asset freeze was obtained last week, but the case was officially unsealed Tuesday.

Moral of the story
The SEC is not asleep after all. Our tax dollars are at work. We are all happy.

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