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Gregory Jones - South Florida Fraudulent Offering Documents Litigation and Arbitration Attorney

Gregory Jones - South Florida Fraudulent Offering Documents Litigation and Arbitration Attorney

Securities and Exchange Commission v. Gregory G. Jones., Civil Action No. 4:15-CV-438-A (NDTX)

Court Orders Nearly $2 Million Judgment from Attorney Who Defrauded Investors

The Securities and Exchange Commission recently announced that a federal court has ordered a nearly $2 million judgment from an attorney who admitted to defrauding investors in two fraudulent schemes. The Honorable John McBryde, District Judge of the United States District Court for the Northern District of Texas, entered a final judgment on March 22, 2016 against Southlake, Texas attorney Gregory G. Jones. The final judgment orders Jones to disgorge $1,125,000, plus prejudgment interest of $51,534, and to pay a civil penalty of $600,000.

Jones admitted in 2015 to raising approximately $645,000 by selling securities issued by Aquaphex Total Water Solutions, LLC, a company he controlled that purported to recycle fracking water through a filtration process. Jones provided investors with fraudulent offering documents stating that Aquaphex's principals had invested $2 million in the company when they had not put any cash into the company. Jones's offering documents also misrepresented that Aquaphex was expected "to be acquired by an oil services company within five years at a projected value of $21B," that projected investment returns would exceed 115 percent per year, and that investors were guaranteed to at least double their investment within five years. None of these claims had a reasonable basis in fact, since Aquaphex had no customers, no contracts to provide water-filtration services, and no revenues. Separately, in 2009, Jones represented a small group of investors that invested approximately $6 million in an entity called Edwards Exploration. Jones failed to disclose to the investors that Edwards Exploration paid Jones approximately $480,000 from the principal amount invested.

In its latest order, the court determined that Jones's violations in the Aquaphex scheme involved "fraud, deceit, manipulation" and that he "acted intentionally" in duping investors. The court specifically observed that Jones's testimony or presentation was not "credible," and that the court was not "impressed with Jones's demeanor for truthfulness while he was on the stand."

The court previously enjoined Jones and Aquaphex from violating anti-fraud provisions of Section 10(b) and Rule 10b-5 of the Securities Exchange Act of 1934 and Section 17(a) of the Securities Act of 1933, and from violating registration provisions of Sections 5(a) and (c) of the Securities Act.

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At the Boca Raton Law Office of Russell L. Forkey, we represent clients throughout South and Central Florida, including Fort Lauderdale, West Palm Beach, Boca Raton, Sunrise, Plantation, Coral Springs, Deerfield Beach, Pompano Beach, Delray, Boynton Beach, Hollywood, Lake Worth, Royal Palm Beach, Manalapan, Jupiter, Gulf Stream, Wellington, Fort Pierce, Stuart, Palm City, Jupiter, Miami, Orlando, Maitland, Winter Park, Altamonte Springs, Lake Mary, Heathrow, Melbourne, Palm Bay, Cocoa Beach, Vero Beach, Daytona Beach, Deland, New Smyrna Beach, Ormand Beach, Broward County, Palm Beach County, Dade County, Orange County, Seminole County, Martin County, Brevard County, Indian River County, Volusia County and Monroe County, Florida. The law office of Russell L. Forkey also represents South American, Canadian and other foreign residents that do business with U.S. financial institutions, investment advisors, brokerage and precious metal firms.

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