Soreide Law Group Investigating Payson Petroleum Fraud Allegations

Soreide Law Group Investigating Payson Petroleum Fraud Allegations

Soreide Law Group is investigating claims on behalf of investors who have been sold investments in Payson Petroleum (Grayson County, Texas) – a company founded by Matthew Carl Griffin to pioneer oil investment opportunities for independent investors. Payson Petroleum investors are at risk of losing their investments because of Payson Petroleum’s bankruptcy filing.

Particularly, A chapter 7 bankruptcy had been filed by Payson Petroleum and Payson Operating, LLC in June of 2016. Eventually, this chapter 7 bankruptcy was transitioned to a chapter 11 bankruptcy. Critically, a bankruptcy trustee revealed that once administrative expenses are paid, Payson Petroleum will have insufficient funds to cover the payments to unsecured creditors.

SEC’s Complaint Against Matthew Carl Griffin and William Daniel Griffin

The Securities and Exchange Commission (“SEC”) brought Civil Action #4:16-cv-00902 against Matthew Carl Griffin (Payson Petroleum’s incorporator) and William Daniel Griffin (Chief Administrator Officer) in November 2016, alleging that the Griffins engaged in fraud through offering investors interests in at least two Texas-based partnerships.

Specifically, SEC’s Complaint claimed that from November 2013 to July 2014, Matthew Carl Griffin and William Daniel Griffin, on behalf of Payson Petroleum, Inc., committed fraud when executing a two-phase offering of the interests. Apparently, $23,000,000.00 was raised by the Griffins’ for the two Texas-based partnerships by way of 150 investors’ aggregate contributions. Allegedly, the stated goal of the offerings was to fund the development of three oil and gas wells. But the SEC alleged that Matthew Carl Griffin and William Daniel Griffin deceived investors regarding Payson’s compensation as the operator and sponsor of the program as well as Payson’s involvement in the program.

SEC Claims Payson Petroleum Offer Was Misrepresented

First, the Complaint alleged that Matthew Carl Griffin and William Daniel Griffin misrepresented that $5,400,000.00 (twenty percent of the offering) would be funded through Payson. As a result, investors were led to believe that at least twenty percent of the costs of the wells would be covered via Payson’s capital infusion. Second, Matthew Carl Griffin and William Daniel Griffin claimed that Payson’s compensation would be capped at twenty percent of the wells’ revenue. Third, Matthew Carl Griffin and William Daniel Griffin stated that Payson would cover cost overages pertaining to the drilling and completion of the wells.

According to the SEC, Payson neither contributed funds to the offering nor covered any costs for the wells. Allegedly, Payson applied the entire amount of the proceeds from the offering, less offering costs. Plus, SEC claimed that Payson was not financially capable of paying cost overages regardless of the amount.

Because of those alleged misrepresentations, SEC alleged that Matthew Carl Griffin and William Daniel Griffin committed violations of Section 10(b) of the Securities Exchange Act, SEC’s Rule 10b-5, and Section 17(a) of the Securities Act. So far, Matthew Carl Griffin and William Daniel Griffin consented to, among other things, disgorging gains and paying an unspecified civil penalty.

Payson Petroleum accumulated millions of dollars through private placements that included: Payson Petroleum, Inc.; Payson Drilling Fund 2015, I, LP; Payson Drilling fund 2015 II, LP; Payson Development Drilling Fund 2014 II, LP; Payson Petroleum 3 Well 2014, LP; Payson Petroleum 3 Well, LP; Payson Petroleum Brown No. 1 LP; Payson North Texas Multi-Well I, LP; Payson Petroleum Crowe 1, LP; Payson Petroleum Grayson 2 Well, LP; Payson Petroleum J.C. #1, LP; and Payson Petroleum Jenny #1, LP.

Suffered Losses By Investing In Payson Petroleum

Investors have been offered investments in Payson Petroleum through brokers and firms through the United States including Whitehall-Parker Securities, Inc.; Wall and Company Securities; Security Research Associates, Inc.; PTX Securities, LLC; Moloney Securities Co., Inc.; MidAmerica Financial Services; Financial West Group; H. Hill Securities LLLP; CFD Investments Inc.; EDI Financial Inc.; A. Repple & Company and Balanced Financial Securities, LLC.

Lars Soreide Highest Ethical Standard Award 2018

Lars Soreide Highest Ethical Standard Award 2018

Payson Petroleum is believed to either be defunct or at risk of being defunct. Therefore, investors who have purchased investments in Payson Petroleum are encouraged to contact Soreide Law Group at (888) 760-6552 for a free consultation. Our firm has recovered millions of dollars for investors who have suffered losses. We represent clients on a contingency fee basis and advance all costs.

2018-11-30T03:41:34+00:00November 30th, 2018|

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