U.S. SECURITIES AND EXCHANGE COMMISSION
SECURITIES EXCHANGE ACT OF 1934
Release No. 48572 / September 30, 2003
File No. 3-11287
Commission Initiates Administrative Proceeding Against Larry R. Crowder and John R. Powell
On September 30, 2003, the Securities and Exchange Commission instituted administrative proceedings against Larry Crowder and John R. Powell based on the entry of a judgment of permanent injunctions against them. The Division of Enforcement ("Division") in its Complaint in the injunctive action alleged that from 1993 to the present, Crowder and Powell raised $15.7 million from more than 600 investors nationwide through their companies, Environmental Energy, Inc. ("EEI"), EEI's affiliates, and Irvine Securities, Inc. That Complaint further alleged that the respondents failed to disclose adequately the extent of the "profits" that EEI made selling oil and gas rights to the partnerships, and that the vast majority of the funds were diverted to the personal benefit of Crowder, Powell and others.
A hearing will be held before an Administrative Law Judge to determine whether the Division's allegations are true, to provide respondents an opportunity to dispute the allegations, and to determine what sanctions, if any, are appropriate and in the public interest. The Commission directed that an administrative law judge issue an initial decision in this matter within 210 days from the date of service of the Order Instituting Proceedings.
On October 10, 2002, in an action brought by the Commission, the United States District Court for the Central District of California entered an injunction prohibiting Powell and Crowder from violating the securities registration and antifraud provisions of the federal securities laws, Sections 5(a), 5(c), and 17(a) of the Securities Act of 1933, Section 10(b) of the Securities Exchange Act of 1934, and Rule 10b-5. On August 5, 2003, a federal grand jury indicted Powell for making false statements to the Commission, and the indictment was subsequently amended to add wire fraud charges. For more information, see Litigation Release Nos. 18281 (August 8, 2003), 18182 (June 9, 2003), and 15822 (July 29, 1998).