James Duhon and Source Capital Hit with Cease and Desist Order by California’s Department of Business Oversight
On October 10, 2016 the State of California’s Department of Business Oversight issued a cease and desist order against Source Capital and James Duhon over allegations they participated in an unqualified offering of securities to California residents. The claim relates to an offering of securities in oil and gas programs overseen by the Blue Ridge Group, and includes the Belmont Drilling Program, the Galveston Bay Drilling Program and three other oil and gas drilling programs sold by among others, James Duhon and Source Capital. The order also alleges that Source Capital and James Duhon offered and sold unqualified securities to the public by way of material omissions of fact.
The Commissioner alleges that from September 2010 through November, 2012, James Duhon and Source Capital sold oil and gas securities to investors without those securities being qualified for sale, and by way of either material omission of fact or through material omissions, including the rate of return that investors could expect from the programs managed by Blue Ridge Group. One California based investor was told he could receive his money back any time he asked for it, which the Commissioner found to be materially inaccurate.