Collin County Man Sentenced in Oil & Gas Investment Fraud Scheme
PLANO, Texas – A Melissa man has been sentenced to prison in the Eastern District of Texas for federal violations, announced U.S. Attorney Brit Featherston today.
Matthew Wayne Fox, 47, pleaded guilty on March 9, 2020 to wire fraud and was sentenced to 33 months in federal prison today by U.S. District Judge Sean D. Jordan. Fox was also ordered to pay restitution in the amount of $862,150.
According to information presented in court, beginning in 2015, Fox formed Wayne Energy, a company that was to specialize in the oil and gas exploration fields. Fox previously was the CEO of a business named Frisco Exploration, that went out of business. From March 2015 through October 2016, Fox raised approximately $949,650 from investors to form a joint venture to convert an oil well to a natural gas well in Upshur County, Texas. Fox solicited the funds through various literature and emails sent to potential investors.
The emails Fox sent contained several misrepresentations about the joint venture such as ownership of the well, the cost of converting the well, the production of a similar well, and actual work done on site. Further misrepresentations included that Wayne Energy was a licensed operator with the State of Texas Railroad Commission. Following the initial investment Fox continued to send emails with misrepresentations about work done on the site in order to solicit more money. An investigation by the SEC showed the majority of money raised by investors was used for the Fox family personal use.
The SEC launched an investigation into Fox following complaints about the investments in the natural gas well. The SEC obtained a judgment in 2018 against Fox for his conduct in soliciting investors. The SEC referred the case to the Federal Bureau of Investigations, who launched a criminal investigation resulting in the indictment.
This case was investigated by the Federal Bureau of Investigation and the Securities Exchange Commission and prosecuted by Assistant U.S. Attorney William R. Tatum.