georgia man pleads guilty to $7.2 million securities fraud conspiracy
scheme targeted thousands of investors nationwide
KANSAS CITY, Mo. – David M. Ketchmark, Acting United States Attorney for the Western District of Missouri, announced that an Atlanta, Ga., man who lied to investors about his credentials as a Certified Public Accountant pleaded guilty in federal court today to his role in a $7.2 million securities fraud conspiracy that victimized thousands of investors across the United States and Canada who bought shares in Petro America Corporation, which was purported to be a profitable company with $284 billion in assets.
Clarence D. Moore, 65, of Atlanta, Ga., pleaded guilty before U.S. District Judge Brian C. Wimes to the charge contained in a June 15, 2011, federal indictment.
By pleading guilty today, Moore admitted that he participated in a conspiracy to commit securities fraud and wire fraud. Contrary to the fraudulent representations Moore and others made to victim-investors, Petro America had no oil, no realistic prospects for obtaining, transporting or storing large amounts of oil, no significant assets, no revenue and no employees other than the CEO.
Moore does not have a college degree, he has never been a Certified Public Accountant, and he is not a licensed tax preparer. In February 2010, however, Moore began doing accounting work on behalf of Petro America. He signed false documents related to Petro’s supposed assets, and other documents were signed on his behalf. These included investor “lulling letters” and false tax returns, which were designed to make investors believe that Petro’s supposed billions of dollars’ worth of assets had been verified by a professional C.P.A. Moore also signed an additional letter containing false representations about his credentials. In exchange, he received payments of at least $3,500. Moore was supposed to receive an additional $5,000 retainer, but never did.
In January 2010, Moore was asked to help determine a valuation for Petro America’s assets and stock. Over the phone and without examining any documents or conducting any due diligence, Moore agreed on a figure of $24 per share. A letter was then circulated under Moore’s signature that indicated Petro had been valued by Moore, whom the letter falsely represented was a C.P.A., at $284 billion and $24 per share. In an introduction to the letter, on Petro America letterhead, Moore was described as a 1976 graduate of Atlanta College, a licensed C.P.A. in the state of Georgia, and “the first African-American accountant for Gulf Oil and also a former auditor for Exxon.” This letter was used to induce numerous investors to purchase purported stock in Petro America.
In actuality, Moore is not and has never been a C.P.A. Moore dropped out of Clark College after one semester following an incident where he was shot in the back of the head. Moore has had balance and equilibrium problems since that time. Recently, he has been homeless. Moore has spent time in prison or jail in each of the last three decades primarily for criminal forgery and fraud. He worked briefly as an accounting clerk for Gulf Oil in the 1970s. In 1972, he worked for Exxon, where he examined receipts from cash registers at service stations.
In the spring of 2010, Moore drove from Atlanta to Kansas City, Mo., to prepare tax returns for Petro America. Although the filing system was “atrocious” and the returns contained false, incomplete, and misleading information, Moore nevertheless signed the returns and filed them with the IRS. The returns contained unsupported, sky-high valuations for Petro.
Moore is the ninth defendant to plead guilty in this case. Curtis White, 56, of Independence , Mo.; Charles Hooker, 50, and Teresa Hill, 56, both of Kansas City, Mo.; the Rev. Edward D. Halliburton, 58, of Kansas City, Kan.; Allen Collins, 56, of Raymore, Mo.; Joseph Harrell, 50, of Waco, Texas, who acted as the CFO of Petro America; Brian Langenbach, 43, of Globe, Ariz.; and Russell Hopkins, 48, of Tuscaloosa, Ala., have also pleaded guilty to participating in the conspiracy.
Under federal statutes, Moore is subject to a sentence of up to five years in federal prison without parole, plus a fine up to $250,000 and an order of restitution.
Web Site Support For Fraud Victims
Two Web sites have been established to collect information from the victims of the alleged securities fraud scheme and to provide updated information about the status of the case. Investors of Petro America are encouraged to provide information via an online form at www.postalinspectorsurvey.com/PetroAmerica. Due to the volume of expected responses, this process has been automated and placed online; all communication from potential victims regarding the case should be made via this Web site. Updates about the status of the case will be posted at www.justice.gov/usao/mow/divisions/petro.html
This case is being prosecuted by Assistant U.S. Attorneys Daniel M. Nelson and Kathleen D. Mahoney. It was investigated by IRS-Criminal Investigation, the U.S. Postal Inspection Service and the Office of the Missouri Securities Commissioner.