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|Commission Halts Unregistered Activity
By Tim Cooksey Oil, LLC, JKV Management Consulting, LLC, Jefferson K. Villines III, and Sean Patrick Riley a.k.a. Patrick Riley
Harrisburg, PA, 02/24/2012 — To halt the offer and sale of unregistered securities in Pennsylvania, the Pennsylvania Securities Commission (Commission) issued a Summary Order to Cease and Desist against Tim Cooksey Oil, LLC (Cooksey) an entity with an address in Thompsonville, Illinois, JKV Management Consulting, LLC (JKV), an entity with an address in Helotes, Texas, and Jefferson K. Villines III (Villines) and Sean Patrick Riley a.k.a. Patrick Riley (Riley), both individuals with an address in San Antonio, Texas. Cooksey was offering a 25% working interest (Interest) in the “US Steel Two Well located on the Akin South Field in Southern Illinois” (Program). The Program purports to be an oil and gas drilling and testing investment located in Illinois and is also purportedly a “joint venture.” Cooksey was the operator of the Program. JKV was offering the Interests for sale. Villines was the president and CEO of JKV. Riley was a senior vice-president of JKV.
An advertisement was posted on the Internet that stated, “Turn Key Oil Investments with Cash Flow for Sale” [Ad]. The Ad had an address at http://investments-and-acquistions.com/turn-key-oil-investments-with-cash-flow-for-sale/. In or about December 2011, at least one Pennsylvania resident (PA Resident) viewed the Ad, and using a contact page provided in the Ad, sent an e-mail to request additional information about the available investments. The same month, Riley responded to the PA Resident’s e-mail and telephoned the PA Resident. Riley stated that his job at JKV is to “bring in guys who wanted to invest in oil wells and didn’t want to get their hands dirty”; that the PA Resident could buy a percentage of the Program for $25,000; that Riley had a deal with “$400,000 left” in it for purchase; and that JKV is offering the Interests for sale.
In or about December 2011, Riley e-mailed offering materials (Materials) to the PA Resident. The Materials state that the Program has a 25% Interest for sale; that the PA Resident could buy “whatever portion” he was “comfortable with”; that “There is a 25% [Interest] … still available [in the Program] for $500,000”; that “$50k gets you 2.5% of both wells [in the Program]”; and that the PA Resident could “send a wire to the joint venture…account” to purchase an Interest.
In or about January 2012, Riley sent the PA Resident another e-mail with additional Materials, including an Operating Agreement, a letter from Villines, banking instructions, a Receipt for Investment, and a Purchase Agreement. The Materials state that JKV “is presenting [the Program which is] a two well drilling partnership with an “80% NRI and 100% WI”; that the Program is $1,2000,000 for the US Steel two well partnership located on the Akin South Field and “is turn-key”; that an Interest will pay $960 per month; and that Cooksey oversees all drilling and completion and is the operator of the Program. The letter from Villines states that the PA Resident should send his money to JKV via wire for his “purchase of [a] 2.50% Interest [in the Program] for the sum of $50,000.”
That same month, Villines telephoned the PA Resident and told the PA Resident that he did not need to perform any work in order to invest in the Interests.
The PA Resident had no substantive, pre-existing relationship with Cooksey, JKV, Villines, or Riley. The PA Resident was not an accredited investor under Rule 501 of Regulation D, and did not have sufficient knowledge and experience in financial and business matters to be capable of evaluating the merits and risks of the investment. The Ad does not contain the disclosure set forth in Commission Regulations.
The Commission ordered Tim Cooksey Oil, LLC, JKV Management Consulting, LLC, Jefferson K. Villines III, and Sean Patrick Riley a.k.a. Patrick Riley to stop offering and selling the Interests in the Commonwealth of Pennsylvania, in violation of the Pennsylvania Securities Act of 1972, and in particular Sections 201 and 301 thereof.
Any further solicitations or sales made by these respondents in Pennsylvania will constitute violations of the 1972 Act and the Commission's Orders. Any person who is solicited by or has information about these respondents is asked to immediately notify the Pennsylvania Securities Commission by calling 800-600-0007, or, in Harrisburg: (717) 787-8062, in Pittsburgh: (412) 565-5083 or in Philadelphia: (215) 560-2088.
Alternate formats of this release may be available on request;