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Colt Ledger & Associates, Inc., the country’s leading private investigation company specializing in private placement security fraud, has just completed an exhaustive investigation into the oil and gas drilling activities of Petrotech Resource Corporation. The results of that investigation have been compiled into a research report backed by seemingly irrefutable facts that lay the foundation for complaints currently being filed with the SEC, United States Secret Service, FBI, USPS, IRS, multiple State Securities, and prosecutorial agencies. Former Petrotech clients have provided extensive background information and offering materials regarding “cold calling, ” the offer of elder finance fraud, mail fraud, wire fraud, money laundering, bank fraud, misrepresentation, and many more damning allegations.
Petrotech Resources Corporation is an oil and gas drilling program based in Glasgow, Kentucky. The company was founded in 2001 by owner John Walden Burness who has been named as the principal along with Jocquinna Wilkins Bailey, Brian Johnny Evans, Scott Peacock, Chad Pennington, Geologist Jack Wheat, CPA Shane Polson, Attorneys Jeff Herbert and Hunter Durham and others are named as aiding and abetting in the alleged securities and criminal fraud and criminal activity associated with the fraud.
The City of Edmonton in Kentucky, the Mayor, City Council and the City Attorney sitting at the time of an alleged, large scale “Bait and Switch” fraud scheme are also named as aiding and abetting Mr. Burness in allegedly defrauding investors from across the country.
To date, more than 40 Petrotech investors have submitted sworn affidavits to Colt Ledger, all telling the same story of cold calling, false investment promises, false production records, bait and switch projects, little to no monetary return, and flimsy excuses that fail to stand up under scrutiny. While this group of investors have allegedly lost several millions of dollars to John Burness, the total loses of all of the Petrotech investors is estimated to be, conservatively, in the 50 to 75 million dollar area. Not one single investor has come forward to say he/she has recouped their investment. In fact, the production records of projects involving clients appear to indicate that John Burness has never had a truly successful project despite documented claims of enormous success.
John did hit a big well $12 to $15 million, coincidently, there appears to have been only two investors. According to an interview with one of the “partners”, the second partner is dead and the one we spoke with says he has never received a cent from John Burness. In fact, he did not even know that the well had been hit!
In another project there appears to be a classic “Bait and Switch” tactic, Mr. Burness utilized a contract to supply natural gas to the City of Edmonton, Kentucky, to lure potential investors into, what some have termed, “the perfect scam”; natural gas production with a guaranteed buyer that would increase the market share in the future with “insider” connections to protect the status of the contract.
Mr. Burness presented in an introductory letter written to potential investors, “We have recently signed an agreement with the City of Edmonton, Kentucky, to supply them with natural gas. There is a 20% share of this market available to us, which amounted to $1.7 million dollars last year. City officials have indicated to us that we would be the supplier of choice. We have the opportunity to capture additional market share the next heating season”.
During the subsequent investigation, Colt Ledger & Associates, obtained a copy of the origional contract and soon discovered that John Burness was absolutely, knowingly and willfully misrepresenting the entire project. The contract revealed that, first; it was really nothing more than a one year non-binding agreement with no obligation to purchase any quantity of gas! Second, there was no 20% of anything mentioned! There was no $1.7 million market share started! There was no mention of higher market shares being available! There was absolutely no indication of John Burness being the "producer of choice"! In fact, there was no obligation to even renew the contract! It appears that John Burness willfully, intentionally and, possibly, criminally lured investors into nothing more than a con articulated to defraud investors.
As soon as John Burness had the investors' money in the natural gas project with a guaranteed buyer; John Burness promptly switched them, under protest, to another project and drilled 5 dry holes.
Mr. Burness explained the move to the other project as, “We think that it’s in the best interest of the clients of the West Edmonton Development Program #2, and Petrotech Resources Corporation…. and geologist Jack Wheat recommended the move. Petrotech Resources presented the Don Wolf #3 as a significant find. They told investors that it came “blowing in” with accompanying DVD and geological report”. The investors were told, “Congratulations we hit oil this morning!”, “This is the first deeper test well on this new field that we recently leased, and we hit a Knox (most prolific formation) well with the very first one!”, and “This is extremely good news as we have a new virgin oil field.”
Please Note, two things, first the Don Wolf #3 did not have anything to do with the City of Edmonton deal, it was a diversion and the first step in a classic ‘bait and switch”, second, after all the fanfare, the Don Wolf #3, as reported to the State by John Burness, , never produced a single drop of oil and was plugged and abandoned 10 months after its completion. Everything appeared to be a lie intended to lure investors into fraudulent projects and wells by John Burness.
It has been estimated that less than 5% of the total income of these oil and gas drilling companies and their owners comes from actual oil and/or gas production. The majority estimates from 90% to 95% which comes directly from grossly over charging for the project and grossly under producing any measurable results.
The Kentucky Supreme Court declared in a recent decision favoring Colt Ledger that: “It appears from the record that…Colt Ledger & Associates seeks to recover investment for its clients using, to put it mildly, highly aggressive collection techniques.” The public is reminded that a complaint only contains allegations and is not evidence of guilt. Colt Ledger & Associates, Inc. has filed the necessary complaints with the proper authorities and will let these authorities uncover the truth. Everyone is presumed innocent unless and until proven guilty.
The complaint has been investigated and resolved to the customer’s satisfaction.
Dr. H.C. “Blue” Hill, Executive VP/Senior Partner, of M. R. Cox, Inc., is a graduate of Kirby High School, Woodville, Texas; Southeastern Louisiana University with a B.S. in Agribusiness: Louisiana State University with a M.S. in Soil Chemistry, a M.S. in Phytopathology and a PhD in Entomology. He also holds numerous other advanced degrees in various fields. Blue’s work ethic and tenacity to see things through are a result of his parents’ influence and being reared in rural Southeast Texas. He served his country during the Vietnam War and returned home to attend college on the GI Bill. He finished his degreed programs through academic scholarships in record time while maintaining a 3.7 GPA.
He has traveled, worked, and lived all over the world as a Project coordinator, Manager and Consultant to individual mega-farmers, commercial farmers and foreign governments on agribusiness enterprises. He has served as an expert witness in agriculturally related deaths. He has written many published articles on a wide range of subjects. He and his wife, Dr. Patricia Hill, have also traveled extensively, conducting seminars on Family and Life Skills. Blue’s Sales Training Seminars and his Motivational and Life Skills Workshops have always been well attended.
Blue has recently completed 20+ years of managing single and multiple franchised automobile dealerships. Overseeing and directing the day-to-day operations of multi-million dollar inventories and customer driven service facilities has given Blue a tremendous insight into what it takes to build a successful business. He has been the consummate professional, attending several hundred hours of business, sales, management, creative thinking and writing, business and employment law, and negotiating seminars presented by the top experts in the field, at his own expense.
Blue’s exposure to the oil and gas industry dates back to January 10, 1901 on a knoll outside Beaumont, Texas. His Grandfather, Ezra Estes Bellar, a Cajun, was a young roughneck, working with Anthony Lucas drilling the well that would create Gulf Oil, Amoco, and Exxon. That knoll was called Spindletop. Blue’s Grandfather and uncles went on to become involved in every aspect of the emerging oil and gas industry of Southeast Texas an Southwest Louisiana. All male members of the immediate and extended family worked in these oil and gas fields. The down turns and the wildcat nature of the business took its toll. The “bust” of the 1980’s ended the family’s endeavor. Their last well stopped pumping in the mid 1990’s.
Blue and Patricia moved from Atlanta, Georgia to a 200+ acre farm in South Central Kentucky in 2004. They met Marty Lile that year and the oil and gas flame was reignited. Blue became heavily involved in working with investors on drilling projects in the Appalachian Basin. He also pursued and increased his personal investments in lease plays in Texas.
By early 2006, through his own personal success, it became apparent that the oil and gas lease plays in Texas, Louisiana and Oklahoma offered his clients better opportunities for profit. He and Marty Lile joined forces and launched M.R. Cox, Inc. with a common goal of offering investors more lucrative investment options, maximum tax advantages and an open door policy. Thus the Mission Statement: “M.R. Cox, Inc. offering investors the advantages of a Direct Participation investment with the transparency of a public held company.”
Blue is an avid gardener and family man who spends his leisure time with his wife on their farm with their menagerie of rescued animals. They do have an extensive collection of photos which they will readily share of their two daughters, tow son-in-laws and five grandchildren that they visit often.