Resolute Capital Partners LTD, LLC (RCP) is a Texas-based investment firm that specializes in oil and gas investments. The company has been the subject of a class action lawsuit alleging that it engaged in fraudulent and deceptive practices in connection with its offerings of unregistered oil and gas securities.
Allegations
The lawsuit alleges that RCP and its principals, Thomas J. Powell and Stefan T. Toth, made material misrepresentations and omissions in connection with their offerings of oil and gas securities. Specifically, the lawsuit alleges that RCP:
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Overstated the projected production and profitability of the oil and gas wells in which it was investing.
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Made false or misleading statements about the risks involved in investing in oil and gas securities.
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Failed to disclose the fact that RCP was paying substantial commissions to its salespeople, which reduced the amount of money that was actually invested in the oil and gas wells.
The lawsuit further alleges that RCP’s fraudulent and deceptive practices caused investors to lose millions of dollars.
Status of the Lawsuit
The lawsuit against RCP is still ongoing. In September 2021, the Securities and Exchange Commission (SEC) issued an order against RCP and its principals, finding that they had engaged in fraud and ordering them to pay a total of $600,000 in civil penalties. However, the SEC’s order did not resolve the class action lawsuit, which is still pending in federal court.
Potential Impact of the Lawsuit
If the plaintiffs are successful in their lawsuit, RCP could be forced to pay substantial damages to the investors who lost money as a result of its fraudulent and deceptive practices. The lawsuit could also damage RCP’s reputation and make it difficult for the company to raise capital in the future.
Recommendations for Investors
If you are considering investing in oil and gas securities, you should be aware of the risks involved and take steps to protect yourself from fraud. Here are some recommendations:
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Do your research: Before investing in any oil and gas security, do your research to understand the company, the oil and gas wells in which it is investing, and the risks involved.
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Read the prospectus carefully: The prospectus is a legal document that contains important information about the oil and gas security. Make sure that you read the prospectus carefully and understand all of the information before you invest.
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Talk to a financial advisor: If you are not comfortable investing in oil and gas securities on your own, talk to a financial advisor. A financial advisor can help you understand the risks involved and make sure that you are making a sound investment decision.
Disclaimer
This information is not intended to be legal advice. You should always consult with an attorney to discuss your specific investment situation.
