U.S. SECURITIES AND EXCHANGE COMMISSION
Litigation Release No. 25873 / September 29, 2023
Securities and Exchange Commission v. Stephone N. Patton, Star Oil and Gas Company, Inc., et al., No. 8:23-cv-02212 (M.D. Fla. filed September 29, 2023)
SEC Charges Convicted Felon with Defrauding Seniors and Making Misleading Statements in SEC Filings
The Securities and Exchange Commission today charged convicted felon Stephone N. Patton and his companies Star Oil and Gas Company, Inc., North Gulf Energy Corporation, Inc., and Patton Farms, Inc. (“the Patton Entities”), with making false statements in at least thirty SEC filings and defrauding seniors.
The SEC’s complaint alleges that from 2020 to 2023, Patton made false statements in at least thirty Form D filings on behalf of the Patton Entities and also created a Star Oil website with bogus claims that the company has 31 offshore oil platforms, annual revenues of $16 billion, and over 32,000 employees. In reality, as alleged, the Patton Entities did not have any business operations or assets and did not generate any revenue. The complaint alleges that Patton made material misrepresentations to at least two seniors about the use of investor funds, potential returns, and dividend payments from the businesses, and his business experience and education, without disclosing multiple convictions for identity theft and grand larceny in Florida and Mississippi. The complaint further alleges that Patton misappropriated $53,000 invested by the two seniors to pay for personal expenses.
The SEC’s complaint, filed in U.S. District Court for the Middle District of Florida, charges the defendants with violating the antifraud provisions of Section 17(a) of the Securities Act of 1933 and Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder. The SEC seeks permanent injunctive relief, disgorgement of allegedly ill-gotten gains plus prejudgment interest, civil penalties against each of the defendants, an officer-and-director bar and conduct-based injunction against Patton, and an order mandating that Star Oil and Patton permanently deactivate Star Oil’s website.
The SEC’s investigation was conducted by Hughens Dolisca in the Miami Regional Office and supervised by Jason R. Berkowitz and Glenn S. Gordon. The SEC’s litigation will be led by Alise Johnson and Mr. Dolisca and supervised by Teresa J. Verges. The SEC appreciates the assistance of the Mississippi Secretary of State’s Office, Securities Division.