May 9, 2011
FORMER HOUSTON GAS TRADER SENTENCED TO PRISON FOR $7.9 MILLION WIRE FRAUD CASE
(HOUSTON) – Former Houston gas trader Stephanie Roqumore has been sentenced by United States District Judge Lynn N. Hughes six years in federal prison without parole for defrauding numerous natural gas trading companies of nearly $8 million, United States José Angel Moreno announced today. Judge Hughes handed down the 72-month prison term at a hearing this afternoon.
In February, Roqumore, 48, pleaded guilty to wire fraud admitting that from March 2002 through April 2010, she used false and fraudulent financial statements to defraud 12 known companies - Virginia Power Energy Marketing Inc., Coral Energy Resources L.P., Occidental Energy Marketing Inc., Energy-Koch Trading L.P., Cargill Inc., Hess Corporation, Natural Fuel Resources Inc., Proliance Energy LLC, Southwest Energy L.P., Adams Resource Marketing LTD, Allegheny Energy and CMS Resource Energy Management Company. Judge Hughes has ordered Roqumore to pay $7.8 million in restitution to the victim companies.
Roqumore also admitted that as the sole employee, owner and operator of three natural gas trading companies: SRR Energy Management Resources Inc., d/b/a Gas Energy Management Inc. (GEM), Gas American Resources Inc. (GAR) and Resource American Energy (RAE), she contacted natural gas trading companies all over the country requesting to trade natural gas with them. If the company was interested in trading, Roqumore and the company entered into a Base Contract for Sale and Purchase of Natural Gas. Shortly after entering into the contract, Roqumore would request a line of credit from the trading company in order to purchase natural gas from them. he companies required financial statements from Roqumore for whichever of her three companies she was using at the time. The line of credit was granted based on the net worth of the company provided in its financials. The financial statements provided by Roqumore to obtain the lines of credit were intentionally falsified by her to make her companies (GEM, GAR and RAE) appear to be more profitable and worth far more than they actually were.
She further admitted faxing false financial statements for GEM or GAR under a cover letter purportedly from an actual Certified Public Accountant (C.P.A.). The attached sheets were stamped "audited" and always showed Roqumore's companies, whether GEM or GAR, with a net year-end income in the millions of dollars. Roqumore admitted she falsified the cover letters and that the C.P.A. played no role in her fraudulent scheme. The fraudulent financials showed year-end net incomes for GEM and GAR for 2003 to 2006 in the multi-millions, when in fact neither company’s yearly net income ever exceeded $100K and their ending net income was usually negative. Roqumore also created fraudulent financials for RAE for the same purposes. The RAE financials, however, were sent under a cover letter from a fictitious C.P.A. firm, R&R Accounting and Consulting Group, in Houston.
Roqumore admitted purchasing natural gas from one of the victim companies using the fraudulently obtained line of credit and then selling that natural gas to other gas companies. When the trades settled, Roqumore was paid for the gas she sold but she did not pay the victim company for the gas she bought. For example, from November to December 2005, Energy-Koch Trading L.P. (EKT) sold GEM $1.1 million of natural gas on credit. Roqumore, in turn, sold that natural gas to four other companies for just under $1.1 million. On the settlement dates, GEM was paid a total of $1,092,187.80 by the four companies, but GEM paid EKT only $50,000. Roqumore never paid EKT the remaining $1,046,331.20 for the natural gas she purchased from them.
On Aug. 30, 2006, Roqumore faxed fraudulent financial statements showing a net income of more than $10 million for GAR to National Fuel Resources Inc. (NFR). Natural Fuel Resources Inc. (NFR) sold GAR $1.6 million of natural gas on credit. Roqumore, in turn, sold that natural gas to Conoco Phillips for just more than $1.6 million. On the settlement dates, GAR was paid $1,649,730 by Conoco Phillips but GAR paid NFR only $100,000. Roqumore never paid NFR the remaining $1,494,617 for the natural gas she purchased from them.
In total, Roqumore fraudulently obtained approximately $7.9 million in natural gas on credit from the 12 energy companies from March 2002 through April 2010. Roqumore never paid for that natural gas.
Roqumore will remain on bond pending issuance of an order to surrender to a Bureau of Prisons facility to be designated in near future where she will serve her prison term.
The investigation leading to the charges was conducted by the Texas City office of the FBI. Assistant United States Attorney Al Balboni prosecuted the case.
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