U.S. SECURITIES AND EXCHANGE COMMISSION
Litigation Release No. 21969 / May 13, 2011
United States Securities Exchange Commission v. Jay L. LeBoeuf and New Castle Energy, LLC, Civil Action No. 11-CV-187-J (D. WY.) (May 11, 2011).
SEC CHARGES RECIDIVIST JAY LEBOEUF AND NEW CASTLE ENERGY LLC FOR FRAUDULENT OIL AND GAS OFFERINGS
The Securities and Exchange Commission charged Jay L. LeBoeuf and New Castle Energy, LLC with conducting six fraudulent oil and gas-related offerings on May 11, 2011. Subject to the Court's approval, LeBoeuf and New Castle consented to permanent injunctions against future violations and to administrative bars from participating in the securities industry. In a related criminal case, (U.S. v. Jay L. LeBoeuf d/b/a New Castle Energy, LLC, 11 CR 37 (D. WY.), LeBoeuf entered a plea of guilty to one count of wire fraud.
Aa alleged in the SEC's complaint filed in the U. S. District Court for the District of Wyoming, from at least July 2008 through June 2010, LeBoeuf conducted six oil and gas-related offerings by cold-calling thousands of potential investors nationwide. LeBoeuf, through his company New Castle, raised $540,000 from nine investors, ostensibly to purchase various types of interests in oil and gas projects run by third parties. As Alleged in the complaint, LeBoeuf made misrepresentations to investors regarding the use of investor funds, the anticipated monthly returns and prior regulatory actions brought against him. LeBoeuf failed to properly manage the funds entrusted to him by investors and only applied about 30% of the total funds raised to the intended purpose. The remaining 70% of investor funds was used for LeBoeuf's living expenses, to pay back child support, and to fund New Castle's operations.
Without admitting or denying the Commission's allegations, LeBoeuf and New Castle agreed to consent to the entry of a permanent injunction against future violations of these provisions and a court order directing them to pay disgorgement of $500,988.43 and prejudgment interest of $8,383.20, which will be deemed satisfied by the entry of an order of restitution in the criminal matter. LeBoeuf and New Castle also consented to the imposition of administrative bars from participating in the securities industry.
In the current action, the SEC's complaint alleges that LeBoeuf and New Castle violated Section 17(a) of the Securities Act of 1933, and Sections 10(b), and 15(a) (LeBoeuf only) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder. [SEC v. Jay L. LeBoeuf and New Castle Energy, LLC, Civil Action No. 11-CV-187-J (D. WY.)] (LR-21969). On February 28, 2011, LeBoeuf entered a plea of guilty to one count of wire fraud in a related criminal case being prosecuted by the Wyoming U.S. Attorney's Office (U.S. v. Jay L. LeBoeuf d/b/a New Castle Energy, LLC, 11 CR 37 (D. WY.) and there is a sentencing hearing scheduled for May 27, 2011.