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In the Matter of Miller Energy Resources, Inc., et al.
Admin. Proc. File No. 3-16729

KPMG LLP, et al.
Admin. Proc. File No. 3-18110

Dec. 12, 2022

In four separate orders, the Commission settled cease-and-desist proceedings (the “Orders”) that were instituted on August 6, 2015 against Miller Energy Resources, Inc. (“Miller Energy”), and two of its senior executives and officers, Paul W. Boyd, CPA (“Boyd”), and David M. Hall (“Hall”), and Carlton W. Vogt, III, CPA (collectively, the “Respondents”).  In the Orders, the Commission found the Respondents violated the federal securities laws by materially overstating the value of certain oil and gas assets acquired in Alaska on its financial statements for its third quarter ended January 2010 and fiscal year ended April 2010.  In their respective Orders, the Commission ordered Hall and Boyd to each pay a $125,000.00 civil money penalty to the Commission for transfer to the U.S. Treasury.  The Commission further ordered Miller Energy to pay a $5,000,000.00 civil money penalty, which could be satisfied by a grant to the Commission of an unsecured claim in Miller Energy’s Joint Plan of Reorganization, Case No. 15-00236, pending in the United States Bankruptcy Court for the District of Alaska (the “Bankruptcy Case”).  Any funds paid by Miller Energy were to be held pending a decision whether the Commission, in its discretion, would seek to distribute or transfer the funds to the U.S. Treasury. See the Commission’s Orders: Release Nos. 33-1000233-1008933-10090, and 33-10091.

As of September 2022, the Commission has collected $982,125.92 in accordance with the Orders.

On August 15, 2017, in a related matter, the Commission instituted and simultaneously settled administrative and cease-and-desist proceedings (the “KPMG Order”) against Miller Energy’s successor auditor, KPMG LLP (“KPMG”) and engagement partner, John Riordan, CPA (“Riordan”) in connection with improper professional conduct and securities violations related to an audit of Miller Energy’s financial statements.  The Commission ordered KPMG to pay $4,675,680 in disgorgement, $558,319 in prejudgment interest, and a $1,000,000 civil money penalty and Riordan was ordered to pay a $25,000 civil penalty to the Commission, which would be held pending a decision whether the Commission, in its discretion, would seek to distribute the funds or transfer them to the general fund of the U.S. Treasury.  See the Commission’s Order: Release No. 34-81396.

KPMG and Riordan have paid in full.

On February 23, 2022, the Commission issued an order that created a single Fair Fund (the “Fair Fund”), pursuant to Section 308(a) of the Sarbanes-Oxley Act of 2002, for the funds collected pursuant to the Orders and KPMG Order, including the funds previously ordered to the U.S. Treasury, in addition to any future funds collected pursuant to the Orders for the purpose of distribution to harmed investors. See the Commission’s Order: Release No. 34-94300.

On August 31, 2022, the Commission issued an order appointing Heffler, Radetich & Saitta, LLP, as the Tax Administrator of the Fair Fund.  See the Commission’s Order: Release No. 34-95342.

On September 29, 2022, the Commission issued an order appointing Guidehouse, Inc., Baker & Hostetler LLP, and PACE Claims Services LLC as the fund administrator of the Fair Fund and set the administrator’s bond at $7,241,124.92.  See the Commission’s Order: Release No. 34-95941.

On February 5, 2024, the Commission published a notice of the proposed plan of distribution and opportunity for comment and simultaneously published the proposed plan of distribution (“Proposed Plan”).  The Proposed Plan proposes that Guidehouse Inc., Baker & Hostetler LLP, and PACE Claims Services LLC, serve as the Fund Administrator to oversee the administration and distribution of the Fair Fund. The notice provides the public with 30 days to submit their comments on the Proposed Plan. See the Commission’s Notice:  Release No. 34-99469 and the Proposed Plan.

The Proposed Plan provides that the distribution of the Fair Fund shall be made to compensate investors who were harmed, by the Respondents’ conduct described in the Orders, in connection with financial accounting and reporting fraud, as well as audit failures, related to the valuation of certain oil and gas assets acquired by Miller Energy. from March 22, 2010 through April 29, 2015.

For more information, please contact the Fund Administrator:

Telephone Number: 833-410-9090
Website: Miller.FundAdministratorGBP.com
Email: Support@FundAdministratorGBP.com

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