A 70-year-old man who lived in Hillsboro for about a year in 2013 was indicted last week on a $7.9 million oil and gas fraud scheme, according to information from the U.S. Attorney’s office in Wichita.
The indictment alleges one count of wire fraud while David K. Lawson was owner of Sonstone Trading LLC, 220 N. Main at Cheney, Acting U.S. Attorney Tom Beall said in a press release.
In Lawson’s position also as a director for Sonstone Trading LLC, he made a deal for the company to sell 90 barrels a day of crude oil to Parnon Gathering Inc., Pratt.
Crude oil is unrefined oil produced from oil wells, but what Sonstone provided was not crude oil. Beal said it was raw gas oil, which is a mixture of various refined petroleum products.
The FBI investigated Lawson, but city and county law enforcement officials say they aren’t sure why Hillsboro is connected to the fraud.
Dan Kinning, Hillsboro police chief, said Lawson’s oil and gas fraud scheme could have been going on for years.
“We don’t even know if there was any involvement (of this fraud) in Hillsboro,” he said.
Lawson lived in Hillsboro for about a year in 2013.
“We know it was 2013,” he said, “because he filed a burglary complaint on Sept. 15, 2013.”
Kinning said his office also had a couple of calls on Lawson.
“One was because of a suspicious vehicle out at the municipal airport,” he said. “It seems he had an aircraft there.”
Kinning said he wonders if the reason the U.S. Attorney’s office is saying Lawson is a local man is because he listed a Hillsboro address on his driver’s license.
He and his wife, Renee Livingston-Lawson, lived in the 200 block of North Lincoln, but Kinning was fairly confident no illegal enterprises happened there.
“Maybe somewhere else, but not in Hillsboro—that was their residence,” he said.
Kinning said he remembers Lawson’s wife dealing with exotic animals.
Kansas Wildlife and Parks investigated and these were South American bobcats, he said, adding it turned out they weren’t illegal.
“They were a wild cat, but as long as they were one generation off from being wild, they were legal.”
In reading information about this case, Kinning said it didn’t even say how long the fraud had gone or what dates were involved.
“We do have a Lawson Enterprise in Hillsboro,” Kinning said, “but it’s not the same person listed in the indictment.”
Marion County Attorney Susan Robson said she generally doesn’t get involved in federal cases unless it is something that starts here.
“Then the county contacts federal officials about it, but that generally doesn’t happen,” she said.
Marion County Sheriff Rob Craft agreed with Kinning and Robson about not “necessarily” being contacted because the case involves federal charges with no actual crime event occurring here, other than the federal fraud.
“If there was more, such as a person crime or theft-type crime, we would have been involved at least to the point of knowledge,” he said.
In this case the stock, securities or futures trading and selling are something the federal officials would handle, Craft added.
“I don’t know that any actual buying/selling occurred here, other than through the electronic transfer,” he said.
As for Lawson, Craft said he only knew the man’s name, but didn’t recall any dealings with him.
Craft said he was curious why Hillsboro came up in the headline when Sonstone Trading LLC has companies at 413 S. Main, Pratt, and 220 N. Main, Cheney.
“I am curious why Sonstone Trading of Pratt wasn’t the headline,” he said.
Kinning said: “As to how the headline came up, I can’t even fathom that one.”
If convicted, an official specializing in oil and gas scams said, Lawson could face up to 20 years in federal prison, a fine of up to $250,000 and restitution.
For more information about this recent fraud or other oil and gas investment scams, call the U.S. Attorney’s Office Criminal Division in Wichita at 316-269-6481.