5 convicted in Kansas City stock fraud case - KCTV5

5 convicted in Kansas City stock fraud case

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KANSAS CITY, MO (KCTV/AP) -

A jury has convicted the founder of a Kansas City, MO, company and four of his associates of cheating investors by selling millions of dollars of worthless stock and spending the money on themselves.

Petro America Corp. founder Isreal Owen Hawkins, 57, was convicted Wednesday of conspiracy, securities fraud, aggravated currency structuring and other charges. He faces up to 20 years in prison for the most serious charge and could serve 70 years in prison if the judge runs the crimes consecutively rather than concurrently.

Hawkins' co-defendants were each convicted of conspiracy to commit fraud, which could get each up to five years in prison.

Prosecutors say Hawkins and his associates sold $7.2 million in Petro America stock from 2008 through 2010, at an initial rate of $100 per 100,000 shares. They told investors the stock would sell for $24 per share when the company eventually went public.

Altogether, jurors convicted the men on all 15 counts.

Prosecutors said the men stole for 12,000 investors across the United States and Canada, and some of the investors were in the Kansas City area where the group partnered with local ministers to sell shares to their congregations.

Investors bought shares in Petro America, which was billed as a profitable oil company with $284 billion in assets. Prosecutors said that was a sham company and it was get-rich-quick scheme that preyed on innocent investors.

Nine others previously pleaded guilty.

A judge will consider next week whether to revoke Hawkins' bond now that he's been convicted. He is expected to be sentenced later this year.

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