A West Virginia man indicted for conspiring to defraud oil and gas investors out of $3.1 million pleaded guilty Thursday in federal court to conspiracy to commit mail and wire fraud, according to the U.S. Attorney's Office for the Eastern District of Kentucky.
Ray Garton, 59, of Barrackville, W.Va., admitted that while he was employed by Target Oil and Gas Inc. and Kentucky Indiana Oil and Gas Co. Inc. in Albany and Danville, Ky., he prepared or approved others to prepare drilling program brochures that included misrepresentations and false statements. Garton also admitted to meeting with potential investors at proposed drilling locations in West Virginia and misrepresenting the potential of the sites and the past success of other projects.
The indictment alleged that the oil and gas companies collected nearly $3.2 million from investors, but distributed only $37,882 in royalties, between 2003 and 2008.
Garton will be sentenced next year, according to the U.S. attorney's office. He faces up to 20 years in prison. A trial for five others indicted in the case will be Nov. 4.