A Cincinnati man was sentenced Monday to three years in federal prison for defrauding more than 200 investors out of more than $3 million in a Kentucky oil-well scheme.
U.S. District Judge Gregory F. Van Tatenhove also ordered Michael Hicks to pay back the full amount to the victims, according to a news release from Kerry B. Harvey, U.S. attorney for the Eastern District of Kentucky.
Hicks pleaded guilty in November to mail fraud.
Hicks admitted that, from 2012 to 2014, he was part of a scheme that used high-pressure telephone calls to sell investments in oil wells in Barren, Monroe and Cumberland counties in Kentucky, to victims around the country, according to the U.S. attorney's office.
Sales presentations included fraudulently guaranteed and exaggerated oil-production numbers, and failed to disclose some facts and risks. Those involved using false names with investors, changing their company's name several times, and shifting addresses between Bowling Green, Louisville, Covington, Nashville, and Los Angeles to avoid being caught, the news release said.
As part of Hicks' guilty plea, he admitted that he willingly joined the scheme, opened bank accounts in various names, operated mailing addresses in various names, cashed or deposited investor checks made out to various company names, and then withdrew and mailed the victims' money to his co-defendants in California.
The leader of the scheme, Hicks' half-brother John Westine, was convicted of mail fraud, securities fraud and conspiracy to launder money in January. Mark Cornell, a Central Kentucky oil and gas operator, pleaded guilty to securities fraud in March. Henry Irving Ramer, who worked out of Los Angeles selling "investments" in oil wells, was convicted in May of 21 counts of mail fraud, securities fraud and conspiracy to launder money.
All three are to be sentenced in August or September.
Under federal law, Hicks must serve at least 85 percent of his sentence.