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Agree with you....the call tonight was a disgusting cry to save their multi-level businesses that are tied into Petro...if Petro goes down...so do they....oh, but they do it in the name of God, so it's ok....
They are employed by Performance Packaging. They are not employees of Petro America.
Did you hear this call tonight?
Quoting scripture? Please...he is a crook and got you snookered.
Owen has not done anything for anyone.
It's been over a year he promised those certificates with one excuse after another.
They are all full of it.
She asked "what do any of us have that is working out there" not to ask for our money back...someone please tell me if Petro is WORKING for you? WHAT HAS PETRO DONE THAT THEY PROMISED? NOTHING!!!!!!
You don't get to be with your family no matter who is sick or dying in your family when you are put in jail. So it being outrageous is just ridiculous. And you don't get to use money for bail that you stole. Just an FYI-
Now she says that OUR CEO is going through this for US...they make him sound like JESUS CHRIST...give me a break...keeps on saying he couldn't talk to his family...the jail was disgusting...it wasn't a country club lady it was a JAIL....that is what happens when you scam people....
I hope they all go to jail even the ones that are perpetuating this fraud even now.
They will NOT be able to go public ever with that complaint out there not to mention being arrested for SEC fraud, etc. Did you see the video of the States Attorney talking about the allegations people?
Owen must be laughing all the way to the jail and back again and hopefully back for good
Owen now has a new messenger...they are still singing this tune of going public...this should be illegal...how could they do this to people...what a bunch of crooks
They should all go to jail..
saying they employee over 100 people...and pay them with cash?
OMG please arrest them all so they will stop this BS
Interesting
good traffic
also went up - - -
Petro to have an ALL important call....maybe passing out the hat for Owen's legal fund.
Of course i gotta listen and see what is said. My laugh for the night.
I totally agree with you about Chozan....if he is involved with Petro....what does that say about him.
this forum is not about CHOZON...and if they are saying petro will come back then they are not legit either
If people are that STUPID after the govt arrest Owen and after they read all about the complaint then SHAME ON THEM...if they want to bury their heads in the sand and listen to owen's BS about how it is all lies with his round and round about bs then any member that backs him or believes anything that Petro might rise out of the ashes is drinking the kool aid and there is no help for them...
This email is compliments of Scottrade.com
Oct 29, 2010 (The Kansas City Star - McClatchy-Tribune Information Services via
COMTEX) -- FAITH OR DOUBT -- investors in Petro America Corp. have found one or
the other amid federal allegations that the Kansas City-based company's stock
sales were a scam.
The Kansas City Star has talked with investors from the West Coast to England
and found different stories behind the company's owners.
Petro America shareholders claim they own $284 billion in assets, mostly gold
mines, through the company. Prosecutors, however, say they're victims of a $7.2
million stock fraud that funded cars, jewelry, travel and other trappings of
Petro insiders.
Some investors stand with Petro founder and CEO Owen Hawkins, even after federal
prosecutors charged him Wednesday with two felony counts, including securities
fraud. Other investors say they concluded the business was a scam even before
the first federal claims of possible fraud surfaced last week.
Kansas City
"I know we got got," said David Hill of Kansas City, who bought $500 of Petro
stock through a family member in August 2009.
Hill is like many investors who said they learned about Petro or bought shares
from friends, relatives or others introduced to them by someone they knew and
trusted.
Hill said he never received stock certificates but didn't seek a refund on the
chance Petro might be legitimate.
That changed last Friday when federal investigators called the stock sales a
scam in a lengthy affidavit filed in U.S. District Court in Kansas City.
Hill formally asked the company for his money back on Monday, recalling Hawkins'
frequently repeated offer to buy back shares of unhappy investors. A Petro
America e-mail told Hill to get his money from the family member -- the company
hadn't sold stock since 2008.
A motorcycle accident has left Hill unable to work for more than three months.
"Right now $500 would mean a lot to me," Hill said.
England
Peter Lee of Wallasey, England, has been burned by an investment scam before.
But he thought Petro America wasn't a scam -- no one had asked for more than the
$100 he originally invested.
Lee, 59, was not swayed even by the federal affidavit last Friday.
"Until Owen (Hawkins) is arrested and jailed, I'm afraid I'll stand by Owen,"
Lee said early this week.
Hawkins was arrested but not jailed Wednesday. And Lee has since read the court
documents, which he said changed his thinking.
"I feel a fool because I've been scammed before," he said.
Utah
When federal investigators came down on Petro America's stock sales last week,
Kathleen Crane stood behind the company and Hawkins.
"We're all in this. We're a family behind Petro America," the Utah resident and
stockholder said.
Crane, who wouldn't say how many shares she owns, said she doesn't believe the
government's version, which Hawkins has denied. Instead, she said, Hawkins has
been unfairly attacked and the company's plans blocked.
Contacted after criminal charges were filed against Hawkins this week, Crane's
outlook stayed the same.
"I'm very certain Mr. Hawkins knows what he's doing," she said. "I have faith
and trust in the guy."
Washington state
Brock Mitchell of Walla Walla, Wash., didn't buy his 100,000 shares. They were a
gift from his parents, who paid $100 for them in September 2008.
Mitchell said he listened to a few of the weekly conference calls Hawkins held
on Thursday evenings. But they became repetitive, and "I kind of got a little
bit worn out on the 'Hallelujah Chorus' type of deal," Mitchell said.
At least one call piqued his interest. Investors were told they could turn Petro
shares into loans.
Mitchell had been trying to modify the mortgage on his house and tried to
contact a lawyer in New York who was supposed to arrange the loans.
They never connected. Mitchell lost the house.
"If that came through, I'd keep the house," Mitchell said, adding that he had no
expectations of Petro gains now.
Connecticut
"I always thought it was a scam," said Lucille Trzcinski, a former English
teacher in Connecticut who made up her mind the first time she listened to one
of Hawkins' Thursday evening calls.
"I knew he was no CEO," Trzcinski said.
Trzcinski started to listen when she discovered her then-husband had spent
$1,300 on Petro America shares. She contacted the company but could not get a
prospectus, a document that tells about a company to help investors decide
whether to buy shares.
Trzcinski said she didn't care about the $1,300 -- it wouldn't change her life
-- or who allegedly got fur coats or fancy cars.
She bristled at the religious appeals that Hawkins used and the claims that
shareholders would be able to help charities and ministries from their Petro
gains.
"That is the thing that is so outrageous to me," Trzcinski said, "appealing to
the best in people for the worst possible reasons."
Louisiana
Ken Johnston in Greenwood, La., paid $200 for stock at a meeting in September
2008 with a friend and an active Petro America recruiter in the Shreveport, La.,
area.
He listened to some Thursday calls and heard about the gold mines and how his
shares would pay gains when they started to trade publicly.
But Johnston could find nothing to verify what he heard on the conference calls.
Last fall he talked with investigators from the Securities and Exchange
Commission about the calls.
"It's not the matter of the amount" invested, Johnston said. "The way I look at
it, somebody just lied to me."
Illinois
Paul Romano paid $200 for Petro America shares two years ago.
"I took it on a chance," the Christopher, Ill., resident said.
He expected to sell the stock publicly for a gain because Petro America was
doing deals that gave the company value. Romano is waiting on an auditor's
report that will show what the stock is worth.
"Either it's a fraud or it's real," he said. "I don't know."
Florida
Darren Fuller started out listening to Hawkins' Thursday evening calls "like
clockwork" from his home in Montverde, Fla., but eventually couldn't stand them.
"The lady introducing him makes it sound like she's introducing the president of
the United States," Fuller said.
Fuller distrusted the government even before he heard Hawkins say regulators
were interfering with plans to get Petro's shares to trade publicly.
Fuller, who is unemployed, said he still saw 50-50 odds for a payoff from his
$200.
"I want to believe it can happen, because I really need the money," he said.
------
Petro America investors
Federal prosecutors want to hear from victims of the alleged securities fraud.
Visit postalinspectorssurvey. com/PetroAmerica.
Updates about the criminal case will be available at www.justice.gov.usao/
mow/petro.html.
To see the government's affidavits and criminal complaint, go to KansasCity.com.
To reach Mark Davis, call 816-234-4372 or send e-mail to mdavis@kcstar.com.
To see more of The Kansas City Star, or to subscribe to the newspaper, go to
http://www.kansascity.com. Copyright (c) 2010, The Kansas City Star, Mo.
Distributed by McClatchy-Tribune Information Services. For more information
about the content services offered by McClatchy-Tribune Information Services
(MCT), visit www.mctinfoservices.com, e-mail services@mctinfoservices.com, or
call 866-280-5210 (outside the United States, call +1 312-222-4544).
Mark Davis
Copyright (C) 2010, The Kansas City Star, Mo.
-0-
I miss-spoke - got Teddie's offshore asset protection stuff she is offering through Jackie Rosenfeld mixed up with her onshore trusts she is offering through Chozan Behn.
My opinion about trusting somebody that sells their programs through MLM'ers, conference calls, webinars, and out of hotel lobbies doesn't change. But that is just MINE opinion.
Everybody can have their own opinion about it.
Sorry, but I do believe Chozan encourages people to deal ONSHORE, the legal way -- at least that is what I have gleaned
I was referring to how they move past the failures of programs like P2P and Novalex and just keep on pumping new programs in their places.
I heard on the call tonight Chozan basically tried to convince everybody that one way or another Petro America Corp will move forward.
Something about putting a new President of the company in place.
You realize the reason he is saying this is because his business relies on investors that have money/riches they need to hide in offshore accounts. He has to make everybody believe that Petro America Corp will still work out and everybody will be rich because a lot of people have already probably bought into this asset protection stuff and a lot of others are probably considering it.
Some people are probably gullible enough to pay money into an offshore trust even if they have no assets. That's how much some of these people fall for anything these people tell them. I personally wouldn't be surprised if the people collecting all this money for the offshore trusts disappear with it all like the people that ran Novalex and Omicon. We'll see.
One problem this was not a HYIP or MLM this was suppose to be STOCK
Teddie is a kool-aid drinker that is why. They should haul her butt to jail to for helping to keep this alive even in spite of the charges. Now that the charges were filed and all the info is out there that Owen scammed everyone Teddie is still promoting Petro.
They say the best way to be successful in the MLM/HYIP world is to never get bogged down by past program failures. When your MLM or HYIP program gets shut down or disappears you just move on to the next one.
Can't believe that Teddi Berkowitz is still sending Petro people emails about the Chozan Behn seminar....Today's one reads:
"I do not know if Owen will hold a call or not tonight. If we find out, we will announce it at Chozan's seminar. The number to call is is noted below."
You betcha'....lol....
LOL..yes he is...fitting don't you think?
Yes, keep trying to kick us when we are all down
Everyone will try to dump whatever shares they have left, only problem is, no one wants to buy them :(
Harley
Looks like Owen is having a really bad week and the stock falls to a nickle.
39 page Criminal complaint against Hawkins
United States District Court
WESTERN DISTRICT OF MISSOURI
UNITED STATES OF AMERICA
v.
ISREAL OWEN HAWKINS,
[DOB: 07/26/55]
COUNTS ONE: SECURITIES FRAUD
15 U.S.C. §§ 77e(a), 77e(c) & 77x; & 18 U.S.C. § 2
NMT 5 Years Imprisonment
NMT $10,000 Fine
NMT 3 Years Supervised Release
$100 Mandatory Special Assessment
Class D Felony
COUNT TWO: AGGRAVATED CURRENCY
STRUCTURING
31 U.S.C. §§ 5324(a) & (d)(2); & 18 U.S.C. § 2
NMT 10 Years Imprisonment
NMT $500,000 Fine
NMT 3 Years Supervised Release
$100 Mandatory Special Assessment
Class C Felony
CRIMINAL COMPLAINT
Case Number: 10-0171SWH-01
http://media.kansascity.com/smedia/2010/10/27/19/hawkins_complaint__1_.source.prod_affiliate.81.pdf
A federal affidavit said that in 2008, Petro America entered into a stock agreement with New York company American Marketing Complex Inc. to sell 34 million shares of stock at a value of $2 a share.
But when Hawkins failed to send over copies of Petro America’s financial statements and annual report to American Marketing Complex, CEO Norman King called off the deal and told the Securities and Exchange Commission about it.
This kind of belongs on the other forum that is specifically for the Petro-Kansas shares.
Here is a link to that forum
http://investorshub.advfn.com/boards/board.aspx?board_id=17087
I've been following Teddi's emails about this asset protection program through Chozan Behn.
Interesting that she now includes the Iraqi Dinar program in the emails. I guess she feels that she can't sell you on protecting your riches by only using Petro America Corp as a stand alone selling point any more.
I personally wouldn't invest in any company some MLM'er that was involved in Petro America Corp is trying to sell you. Most MLM'ers are just looking out for themselves. For each person they get to sign up for their programs they make money and money is all they care about.
From what I've heard there has been many delays already in the Iraqi Dinar program. It was supposed to have already paid off by now. There has been lots of people running programs promoting big profits for people that invest in the Iraqi Dinar. Some have already turned out to be scams with the head of the program running off with everybody's money. I don't know much about the Dinar program Teddi is talking about in her email, but if it's like the P2P program or the Novalex program or the Petro America Corp program I wouldn't hold my breath.
Honestly if you are looking for an asset protection program go through a highly reputable financial agency. One you can walk into their office sit down and get all of your questions answered and see what you are signing up for on paper right in front of your face. Don't go through some guy that is involved in MLM programs and has an amateurish website and does webinars and conference calls like this Chozan Behn person.
That's the best advice I can give you about this.
Conspirators often recruited investors through churches and used religious language in their pitches, the affidavit says, including promoting Petro America as a once-in-a-lifetime opportunity to “share the blessing.” Petro America cultivated a relationship with the African American Ministers Alliance Group, the affidavit says, and according to its records made large payments to multiple Kansas City-area pastors, religious leaders and a local civil rights activist.
You're welcome. This is actually my first experience with any kind of stock offering too. I became interested because I know somebody personally that bought some shares in early 2009. I was immediately suspicious about the offering when they told me about it and started looking for more information online. My interest brought me to the ihub where there was already much discussion about whether the company and it's stock was for real or not. People like flaflyersfan and harleyboy were saying things on here that made a lot of sense.
More than anything I just wanted answers. It didn't seem right for a company to be so evasive about sharing real information. The more answers I found the more and more it became obvious that a whole lot wasn't right about Petro America Corp. Over the past several months I've learned an awful lot not just about this company but about the stock market in general and about where and how to find certain information about companies involved in offering securities.
Some day I might even try investing in the stock market or maybe some day all of the stuff I learned about how to do this kind of research might benefit me in some other way. I'm glad to hear the time and effort wasn't all in vain. Thanks for your post.
I received this email from a shareholder that is pushing some guy named Chozan Behn. This is what I received today about an upcoming seminar....QUESTION: LOOK AT OCT 28 AND SEE WHO IS HAVING A LIVE CALL.....LOL. Will it be from his jail cell?
We are going forward...
If you are a Petro shareholder, own dinars, etc. you will
learn how to protect and grow your assets
at the upcoming live seminar in Florida where you will have an opportunity to listen to and ask questions of Chozan Behn, in person.
Chozan is a partner in Dunlap, Wachbrit, Behn & Associates CPA's, Inc. and also owns a consulting firm which specializes in estate and trust issues. Mr. Behn has been a guest on our Petro Information Forums conference calls, lecturing on Personal Financial Management 101.
Come on down--or up or across!!
Regardless of where you live,
you are welcome to join us for
the next live seminar with Chozan Behn
in Tampa, Florida
Thursday, October 28, 6pm - 8pm
Chozan will address your Petro concerns and then
at 8pm we will hear the live call with CEO Owen Hawkins
Friday, October 29, 7pm-9pm
Saturday, October 30, 10am-noon
Different topics are covered at each session
plus Special Guest Speakers
Wyndham Tampa Westshore
700 N. Westshore Blvd.
Tampa, FL 33609
Directions:
(813) 289-8200
wyndhamhoteltampa.com?
Private appointments with Chozan are available on October 28, 29, 30
To make an appointment for a private consult with Chozan Behn:
Contact: Monica Gossette at 816.425.2807 or
mon4chozan@gmail.com
Also, please contact Zane Roberts, Florida coordinator, to let him know which sessions you will be attending so he may prepare appropriately. His seminar email address is: zmroberts@verizon.net or call Zane at 813-480-0564
If you cannot join us, but wish to listen to Chozan live, use the following to call in:
For Thursday & Friday night....Conference Dial-in Number: 760.569.0111
Access Code: 474883#
For Saturday morning...Conference Dial-In Number: 712.432.3030
Access Code: 756832
If you plan on staying at the hotel. special room rates have been arranged by Zane. For reservations, call Brandon Marshall, Senior Sales Manager at the Wyndham Tampa Westshore and tell him you are with the Petro group. His Direct Line: 813.288.3636
I will be coming to Tampa and I can't wait to meet you there!
Best Regards...
Teddi Berkowitz
It should be understood that I am not a financial planner or licensed broker and in no way offering financial advice. It is the responsibility of each individual to check out all information prior to making any financial decision. I accept no liability for any information being passed on.
This e-mail message and any attachment to this e-mail message contains confidential information that may be legally privileged. If you are not the intended recipient, you must not review, retransmit, convert to hard copy, copy, use or disseminate this e-mail or any attachments to it. This e-mail is covered by the Electronic Communications Privacy Act, 18 U.S.C. Sections 2510-2521 and is legally privileged. The information contained in this e-mail is intended only for use of the individual or entity named above. If the reader of this message is not the intended recipient, or the employee or agent responsible to deliver it to the intended recipient, you are hereby notified that any dissemination, distribution or copying of this communication is strictly prohibited. If you have received this e-mail in error, please notify us immediately by return e-mail. Please note that if this e-mail message contains a forwarded message or is a reply to a prior message, some or all of the contents of this message or any attachments may not have been produced by the sender.
I bought the $100 stock (or so called) late of 2008. I am new to this type of business and thought that I really would make a big return. After following your comments, I began to have my eyes opened months before the whole episode with Petro and Owen. I would like to personally thank you and everyone else that opposed the actions of Petro.....because if I had not been prepared for this outcome, I would have been devastated to say the least. Owen is where he needs to be......in jail with the rest of the crooks.
They finally got the bastard!!!!
Now to round up the rest of them..jeannie tucker, johnny, marcia, teresa brown and all those wonderful ministers...can't wait
lol finally where he belongs....woohoo!!!!!!
lol birds of a feather ....
This case is being prosecuted by Assistant U.S. Attorney Daniel M. Nelson. It was investigated by IRS-Criminal Investigation, the U.S. Postal Inspection Service and the Office of the Missouri Securities Commissioner.
Victim Survey + Video
For Petro America Corp Kansas sharholders
the purported Owner's of PTRZ
PTRZ shareholders are not to use this form.
Federal Online Form For Potential Victims
Federal prosecutors have set up website for victims of the alleged scheme.
http://www.postalinspectorsurvey.com/PetroAmerica
Video
http://videos.kansascity.com/vmix_hosted_apps/p/media?id=23654901
Nebraska TV Global Story
http://www.nebraska.tv/Global/story.asp?S=13398152
Confirmed now that Owen Hawkins was arrested and charged by the FEDS
Feds file two criminal charges against Petro America founder
By Mark Davis October 27, 2010 - 2:18pm.
Federal prosecutors filed criminal securities fraud charges this afternoon against Owen Hawkins, founder and chief executive of Kansas City-based Petro America Corp.
The two-count complaint charged Hawkins, 55, with securities fraud and with structuring financial transactions to avoid federal securities reporting requirements.
Hawkins was the only person charged by the U.S. Attorney’s office. However, U.S. Attorney Beth Phillips said the investigation into Petro America is continuing and that "there's a possibility, but no assurance, that others will be charged."
Hawkins was arrested this morning at his home in Kansas City, Kan., and is in custody.
Prosecutors said the securities fraud amounted to about $7.2 million.
Prosecutors announced the charges at a news conference at the U.S. courthouse in Kansas City.
Petro America has claimed it owns $284 billion worth of assets, principally in gold mines, for its 12,000 shareholders who hold 12 billion of its shares.
The criminal charges come five days after a government affidavit filed in a civil complaint had declared Petro America’s stock sales to be a scam. The affidavit, signed by a special agent with the Internal Revenue service, said investors had put $5 million into the company but insiders had diverted most of it for personal gain.
In the civil complaint last Friday, the government sought forfeiture of assets, including six bank accounts, that it claimed were connected with or involved in securities fraud and other crimes.
Hawkins,in response to the civil complaint, said last Friday that "we committed no fraud."
http://economy.kansascity.com/?q=node/8749
Owen Hawkins arrested today?
http://blogs.pitch.com/plog/2010/10/feds_to_charge_owen_hawkins.php
Sounds like some of the local news stations will be covering it too like Channel 4 Fox in KC.
Still waiting for you to post any facts actually; all you seem to do is question every poster who comes in the door. So far you have been proven wrong EVERY step of the way, but don't let that get you down....
Harley
just pointing out the facts to you, take it for it worth.
Thanks. I think anyone encouraging people to buy THIS stock is misguided, misinformed, and seeking to personally gain from the ignorance and misfortune of others.
New potential investors: GREY_MARKET_STOCKS_ARE_NOT_INVESTMENTS.
This is a good way to lose 100% of your money.
This company is being operated in an irresponsible manner.
The stock was suspended and placed on the GREY MARKET quotation service with NO BID and NO ASK for a GOOD REASON. #msg-54026462
If you are considering averaging down on a position you took some time ago, or are (heaven forbid) actually being encouraged by a third party to invest in this stock, you are NOT being told the full story of what is going on here.
There are plenty of posts on this message board that you should read with an unbiased, open eye, not with a pre-determined idea that investing here is a good idea.
You do realize that there are different boards for these stocks, so you do need to post on the appropriate board. The PTRZ stock is still trading, so it trading, contrary to what ever you believe. No apologizes needed, right?
What difference does it make?
THIS is what people need to know, no apologies needed.
http://investorshub.advfn.com/boards/read_msg.aspx?message_id=55981529
Are you referring to the PTRZ, or the Petro Kansas Stock shares?
Were they PTRZ stock certificates or Petro Kansas stock certificates?
Two completely different companies (except for having the same CEO) who's stock certificates are unrelated.
There is a separate stock board for Petro America Corp - Kansas entity
http://investorshub.advfn.com/boards/board.aspx?board_id=17087
If you have Petro Kansas stock certificates any stock broker you take them to will tell you they are worthless.
If you have PTRZ stock certificates, for now you can still trade those. PTRZ is trading on the grey market. They opened today at 11 cents a share. You are on the PTRZ forum.
As far as stock certificates for Petro Kansas go - they look sort of real, but they were just typed up on Owen Hawkins computer at first. Later he employed Minuteman Printers to make the stock certificates for him. Even that part of this operation was a sham.
Does your stock certificate look like this?
http://investorshub.advfn.com/uimage/uploads/2010/9/11/kkqnx2.jpg
That's one of the Petro Kansas ones. It's not hard to create your very own stock certificate. Lots of resources online to find certificates for anything.
Have you tried to cash them in? Put them with a broker? If so they will tell you they are worthless.
Owen, Johnny, Teresa Brown, Marcia the secretary have all taken us on a long ride and continues to do so with these farce of a calls. Owen is trying to talk his way out of this but it ain't gonna happen.
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http://www.petroamericacorp.com/
FOR SEC FILINGS:
http://www.sec.gov/cgi-bin/browse-edgar?company=&CIK=0001122771&filenum=&State=&SIC=&owner=include&action=getcompany
http://www.sec.gov/cgi-bin/browse-edgar?action=getcompany&CIK=0001447994&owner=exclude&count=40
________________________________________________________________________________________________________________________________
NEWS RELEASE
OFFICE OF THE UNITED STATES ATTORNEY
WESTERN DISTRICT OF MISSOURI
BETH PHILLIPS
Contact Don Ledford, Public Affairs ? (816) 426-4220 ? 400 East Ninth Street, Room 5510 ? Kansas City, MO 64106
www.justice.gov/usao/mow/index.html
OCTOBER 27, 2010
FOR IMMEDIATE RELEASE
KCK MAN CHARGED IN $7.2 MILLION FRAUD SCHEME THAT TARGETED THOUSANDS OF INVESTORS NATIONWIDE
KANSAS CITY, Mo. – Beth Phillips, United States Attorney for the Western District of Missouri, announced today that a Kansas City, Kan., man has been charged in federal court for his role in a $7.2 million securities fraud scheme that victimized thousands of investors across the United States.
“A federal criminal complaint alleges that Petro America was an empty facade of a business run by deception and false promises,” Phillips said. “Petro’s founder is charged with defrauding unwary investors by selling them worthless stock in order to support his lavish lifestyle.”
Isreal Owen Hawkins, 55, of Kansas City, Kan., was charged in a two-count criminal complaint filed in the U.S. District Court in Kansas City, Mo. Hawkins is the president and CEO of Petro America Corporation. A related civil forfeiture was filed against Petro America on Friday, Oct. 22, 2010.
The criminal complaint charges Hawkins with securities fraud and with structuring financial transactions in order to evade federal reporting requirements. Hawkins founded Petro America, which bills itself as a holding company for crude oil and gold mines (among other claimed assets) in 2007.
Count One: Securities Fraud
According to an affidavit filed in support of the criminal complaint, Hawkins began selling shares of unregistered stock to investors in 2008. At the time, the affidavit says, Petro America had no oil, no realistic prospects for obtaining, transporting or storing large amounts of oil, no significant assets, no revenue and no other employees. The government is aware of no evidence that Petro America has seriously pursued any opportunities to acquire oil fields or conducted oil trading operations. Nevertheless, the affidavit says, Hawkins and others have touted excellent prospects for Petro’s rapid growth in the oil industry.
According to the affidavit, more than 9,000 victims have invested in excess of $7.2 million since August 2008, but instead of using that revenue for legitimate business-related purposes, Hawkins and his co-conspirators allegedly withdrew investors’ funds from Petro America’s bank accounts in cash, which they spent on personal expenditures such as a house by the lake, luxury cars, a $5,700 fur coat, a $37,000 boat, a $5,200 piece of Louis Vuitton luggage purchased in Switzerland, expensive jewelry and travel.
Hawkins, the only full-time employee of Petro America, paid himself an annual salary of $595,000 under a contract that also granted him a $175,000 bonus, 500 million shares that are immediately exercisable, a company car, a company apartment in Missouri, and a dining card. Hawkins drew his salary in cash, in random amounts at inconsistent times, and the company did not withhold taxes.
Conspirators often recruited investors through churches and used religious language in their pitches, the affidavit says, including promoting Petro America as a once-in-a-lifetime opportunity to “share the blessing.” Petro America cultivated a relationship with the African American Ministers Alliance Group, the affidavit says, and according to its records made large payments to multiple Kansas City-area pastors, religious leaders and a local civil rights activist.
Investors lost from $100 to $100,000 each. Initially, many of the investors were drawn into the scheme with the promise that $100 would buy 100,000 shares of Petro America stock, the affidavit says, which Hawkins claimed was “book valued” at $2 per share. As the scheme progressed, conspirators raised the price to invest and claimed an ever-higher “book value” for the shares. The affidavit alleges that this allowed conspirators to unload shares to new investors at an increasing profit. To date, the affidavit says, the stock has never been properly registered or listed on any exchange.
Hawkins allegedly promised “meteoric returns” on investments. At the height of the scheme, the affidavit says, up to $700,000 flooded into the company each month.
Hawkins claimed that Petro America would be “the first African-American holding oil company to go public in the United States,” according to the affidavit. Investors were frequently told that they would be rich when the company “goes public.” Going public, the conspirators allegedly have said for over two years, is just weeks away. In reality, the affidavit says, the company has no significant assets or revenue stream (other than investor proceeds).
Alleged False Claims
Today’s affidavit alleges that Hawkins and co-conspirators provided materially false information to investors. For example, Petro America’s Web site includes a prominent photograph of the luxury office building at Two Pershing Square, ostensibly Petro’s “world corporate headquarters.” In reality, the affidavit says, Hawkins contracts with Regus Management Group LLC, a secretarial service that provides such services as telephone answering, fax and mail handling, use of the address and 16 hours of office usage for an initial monthly fee of $225.
According to the affidavit, conspirators have touted Petro America acquisitions in gold and rock mines as valuable holdings worth hundreds of billions of dollars. In reality, the affidavit says, Petro America’s interests in the gold and rock mines are essentially worthless. Petro America allegedly adopts wildly high valuations for the mines, most or all of which are not producing anything. Many or all of the mines are not actually mines at all, but mining claims. A mining claim is merely a plot of government-owned land upon which a person or corporation has filed a claim of rights to a mineral deposit, which may or may not actually exist.
Based on these representations, Hawkins and others claim that Petro’s assets are worth more than $284 billion. According to the affidavit, if this valuation were accurate, Petro America would be the second-largest company in the United States by market capitalization, larger than Wal-Mart, Apple or Microsoft. America’s largest company is Exxon Mobil, which has a market capitalization of $312.28 billion.
Count Two: Structuring Financial Transactions
Under federal law, banks are required to file Currency Transaction Reports for financial transactions that exceed $10,000 in one day. It is illegal to conduct multiple cash withdrawals in amounts less than $10,000 for the purpose of evading that federal reporting requirement.
The affidavit alleges that Hawkins and others made large cash withdrawals from Petro America’s bank accounts, which were structured to avoid bank reporting laws. For example, according to the affidavit, Hawkins and an unidentified co-conspirator visited Mazuma Credit Union several times each week. Sometimes they made big deposits of multiple checks into the company’s bank account; on most visits, the affidavit says, they withdrew $7,500 to $9,800, often on consecutive days. In this manner, Hawkins obtained at least $537,515 in cash from Petro’s account at Mazuma. The affidavit also alleges that Hawkins structured currency withdrawals out of Petro America accounts at U.S. Bank and Bank of America.
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 http://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 http://www.justice.gov/usao/mow/petro.html
Phillips cautioned that the charges contained in this complaint are simply accusations, and not evidence of guilt. Evidence supporting the charges must be presented to a federal trial jury, whose duty is to determine guilt or innocence.
This case is being prosecuted by Assistant U.S. Attorney Daniel M. Nelson. It was investigated by IRS-Criminal Investigation, the U.S. Postal Inspection Service and the Office of the Missouri Securities Commissioner.
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This news release, as well as additional information about the office of the United States Attorney for the Western District of Missouri, is available on-line at
http://www.justice.gov/usao/mow/index.html
Copies of the Affidavit and Complaint filed by the U.S. Attorney's Office against Petro America Corp:
http://media.kansascity.com/smedia/2010/10/22/22/Affidavit.source.prod_affiliate.81.pdf
http://media.kansascity.com/smedia/2010/10/22/22/Complaint.source.prod_affiliate.81.pdf
Federal prosecutors have set up two websites for victims of the alleged scheme.
39 page criminal complaint against Owen Hawkins:
http://media.kansascity.com/smedia/2010/10/27/19/hawkins_complaint__1_.source.prod_affiliate.81.pdf
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