The former president of a Kentucky oil and gas company was sentenced to prison Wednesday for his role in helping swindle investors of millions of dollars, according to the U.S. Attorney's Office.
Michael D. Smith, 55, of Lancaster was sentenced to 10 years in prison and three years of supervised release. Smith also was ordered by U.S. District Senior Judge Joseph M. Hood to forfeit $3.2 million.
Arriving at a restitution figure was delayed 90 days.
Smith was convicted of mail fraud and conspiracy last July after a monthlong trial. Prosecutors say he led the effort to defraud hundreds of oil and gas investors nationwide, according to the news release from Kerry B. Harvey, U.S. attorney for the Eastern District.
During the sentencing, Hood said, "Michael was the Bruce Springsteen of this operation. He was the boss," according to the release.
From 2003 to 2008, Smith was the president of Target Oil and Gas in Albany and was the owner of Kentucky Indiana Oil and Gas in Danville.
Smith helped attract $15.8 million from investors; about $1.54 million was returned to investors in royalty payments, state police said.
Smith was one of six people convicted.
Joshua Scott Harris, 25, a sales supervisor for Target, was sentenced Tuesday to a year and a day in prison. Shaun Michael Smith of Cookeville, Tenn., was sentenced Monday to 21/2 years in prison. Christopher C. Smith of Prestonsburg, vice president of Target Oil, and geologist Ray Garton of Barrackville, W.Va., are to be sentenced Thursday. Mark Irwin of Cookeville, Tenn., is to be sentenced in July.
Michael D. Smith used Garton to prepare or direct others to prepare drilling program brochures for potential investors that "contained misrepresentations to induce potential investors to purchase shares in the oil and gas drilling programs," the release said.
Salesmen — some trained by Smith — gave false statements to potential investors in Kentucky, California, New Jersey, Arizona and elsewhere about drilling or well success.