U.S. SECURITIES AND EXCHANGE COMMISSION

Litigation Release No. 21040 / May 15, 2009

SEC v. Wellco Energy, LLC, Justin William Rifkin, Patrick V. Looper, Richard G. Pacheco, and Dustin D. White, (United States District Court for the District of Colorado, Civil Action No. 09-cv-01114-MSK-KLM)

SEC OBTAINS EMERGENCY RELIEF AGAINST WELLCO ENERGY, ITS PRINCIPAL, AND ITS SALESMEN FOR OIL AND GAS OFFERING FRAUD

The Securities and Exchange Commission announced that, on May 14, 2009, it filed a civil action in the United States District Court for the District of Colorado alleging an ongoing fraudulent scheme conducted by Wellco Energy, LLC ("Wellco"). Wellco maintains offices in Colorado Springs, Colorado, and acts through its principal Justin William Rifkin, and salesmen Patrick Looper, Richard Pacheco, and Dustin White, each of whom are residents of Colorado Springs, Colorado.

According to the Complaint, the defendants defrauded investors by misrepresenting Wellco's role as the operator of the oil and gas projects, Rifkin's experience in oil and gas production, and Wellco's intended use of investors' funds. Among other things, Wellco's offering materials misrepresented that offering proceeds would be used to fund the drilling and completion operations of wells, when in fact less than half of investors' funds were used for that purpose. The Complaint alleges that, from approximately May 2007 through the present, the defendants raised more than $1 million from investors in four Wellco offerings. Justin William Rifkin, Patrick Looper, Richard Pacheco, and Dustin White allegedly solicited sales of these interests by cold-calling prospective investors nationwide. The Complaint further alleges that Wellco's offerings were not registered with the Commission, nor were Justin William Rifkin, Patrick Looper, Richard Pacheco, and Dustin White associated with a registered broker-dealer.

The Complaint claims that, based on this conduct, all of the defendants violated Sections 5(a), 5(c) and 17(a) of the Securities Act of 1933, and Section 10(b) of the Securities Exchange Act of 1934 ("Exchange Act") and Rule 10b-5 thereunder. The Complaint also claims that Justin William Rifkin, Patrick Looper, Richard Pacheco, and Dustin White violated Exchange Act Section 15(a). On the Commission's application, the Court issued a Temporary Restraining Order, Order of Reference to Magistrate Judge, and Order Setting Hearing ("Order") on May 14, 2009. Among other things, the Court's Order froze the assets of defendants Wellco and Rifkin traceable to the alleged violations pending determination of the Commission's Motion for a Preliminary Injunction.

SEC Complaint