DISTRICT JUDGE ISSUES ORDER AGAINST RAGLIN INDUSTRIES, LLC, PHILLIP LEVAUGHN RAGLIN AND JOSEPH DANIEL LAYNE
For Immediate Release
Thursday, December 14, 2006
Contact: Patricia Labarthe
Oklahoma Securities Commission
405-280-7700
securities.state.ok.us
Oklahoma City///// Oklahoma City: Irving L. Faught, Administrator of the Oklahoma Department of Securities (Department), announced today that the Department filed an action on December 12, 2006, against Raglin Industries, LLC, Phillip Levaughn Raglin and Joseph Daniel Layne (Defendants). Defendants have been operating from Wagoner and Tulsa, Oklahoma. Oklahoma County District Judge Daniel L. Owens ordered Defendants’ to immediately cease the offer and sale of securities including limited liability company membership interests (LLC Interests). The order also places a freeze on all Defendants’ assets and requires an accounting of the receipt and expenditure of funds by Defendants.
The action comes as a result of an investigation by the Department that resulted in the allegations that Defendants, over a period of several months, illegally offered and sold unregistered LLC Interests. The Department alleges that Defendants were operating a "Ponzi Scheme." The term "ponzi scheme" refers to an investment scheme whereby returns to investors are financed, not through the success of an underlying business venture, but from the principal sums of newly attracted investors. Typically, investors are promised large returns for their investments. Initial investors are actually paid the promised returns, attracting additional investors who lose their principal when the scheme eventually collapses.
According to the Petition, Defendants engaged in fraud in connection with the offer and sale of the LLC Interests, to include the following misrepresentations:
a. that Defendants would provide guaranteed profits or returns on the LLC Interests in the nature of interest of up to 30% when, in fact, Defendants have not invested the Investors’ funds in any manner to generate such profits or returns; and
b. that the investigation by the Department was initiated by the Defendants who contacted the Department to make sure they were conducting business properly when, in fact, the Department initiated the investigation after receiving information that Defendants may have violated the Act.
It is also alleged that Defendants engaged in fraud by failing to disclose material facts to investors including the fact that Defendant Phillip Raglin was charged in October, 2005, with the criminal felony of embezzlement in the District Court of Cleveland County, Oklahoma, and that the charge is pending.
The Department stated in its action that a danger exists that the money received by Defendants from the investors or money or securities held by Defendants on behalf of the investors will be lost, removed or transferred. The allegations are that Defendants have not invested investor funds or earned a profit on investor funds. Instead, Defendants have spent the amounts deposited by investors primarily for the payment of personal expenses of the Defendants and for interest payments to earlier investors.
Copies of the Department’s pleadings in the enforcement action can be found on its website at www.securities.ok.gov.
The Administrator of the Department is charged with administration and enforcement of the Oklahoma Securities Act. The Department investigates securities fraud, the offer or sale of unregistered securities, and the sales practices of stockbrokers and investment advisers. The Administrator may seek administrative or civil sanctions against any person who violates state securities regulations and, when appropriate, make criminal referrals.
securities.state.ok.us
OKLAHOMA SECURITIES COMMISSION
Oklahoma City, Oklahoma
PRESS RELEASE
STATE REGULATOR INVESTIGATES RAGLIN INDUSTRIES INVESTMENT PROGRAM
For Immediate Release
Monday, November 20, 2006
Contact: Irving Faught, Administrator
Oklahoma Securities Commission
405-280-7700
Oklahoma City///// Irving L. Faught, Administrator of the Oklahoma Department of
Securities, has launched an investigation into the practices of a business based in
Wagoner, Oklahoma. The investigation targets Raglin Industries, Inc., Raglin Industries,
LLC, Phillip Levaughn Raglin and Joseph Daniel Layne (Respondents).
The Department is investigating whether Respondents are involved in the
unlawful offer, sale and/or purchase of securities in and/or from the state of Oklahoma, in
the nature of membership investments in Raglin Industries, LLC. If the Department
determines that Respondents have violated the Oklahoma Uniform Securities Act of 2004
(Act), Okla. Stat. tit. 71, Sections 1-101 through 1-701 (Supp. 2003) and/or the Rules of the
Oklahoma Securities Commission and the Administrator of the Department of Securities
(Rules), action may be taken by the Department in the nature of administrative or civil
sanctions as provided by the Act.
securities.state.ok.us |
