UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Litigation Release No. 16421 / February 1, 2000
Securities and Exchange Commission v. David Shane Lewis also known as David Kevin Lewis, and Spartan Oil Corporation, Civil Action No. 3-00CV0233-L (USDC NDTX, Dallas Division)
The Securities and Exchange Commission announced that on January 31, 2000, the Commission filed a civil action against David Lewis and Spartan Oil Corporation alleging that Lewis and Spartan engaged in securities fraud in connection with the sale of oil and gas projects and partnership interests. The Commission's complaint alleges that, from May 1997 through October 1998, Lewis raised approximately $1.8 million from over 100 investors in numerous states in a succession of fraudulent oil and gas offerings, initially through Centurion Oil Production Corporation and later through Spartan and an affiliated partnership.
During the relevant period, Spartan maintained offices in Garland, Texas, and Lewis, age 39, resided in the Dallas area. The company is believed to have ceased operations.
According to the complaint, Lewis raised funds for the Centurion and Spartan oil and gas projects using a boiler room sales force. The Commission further alleges that Lewis and Spartan made numerous material misrepresentations and omissions in the offer and sale of oil and gas and partnership interests to investors, including misleading statements about Lewis' experience and past results, the assets and operations of Centurion and later Spartan, Spartan's ownership of certain leases, the potential production and costs of Spartan's oil and gas projects, and the use of investor proceeds. The Commission also alleges that Lewis misapplied Spartan investor funds to repay Centurion investors for their failed project and to run the Spartan boiler room.
The complaint charges Lewis and Spartan with violations of Sections 5(a), 5(c), and 17(a) of the Securities Act of 1933 and Sections 10(b), 15(a), and 15(c) of the Securities Exchange Act of 1934 and Rules 10b-5 and 15c1-2 thereunder. The Commission is seeking a permanent injunction, disgorgement plus prejudgment interest, and civil money penalties against Lewis and Spartan.