Metro Minister Pleads Guilty in Petro America Case
KANSAS CITY, Mo. — A Kansas City, Missouri, man pleaded guilty on Monday for his role in a $7.2 million securities fraud conspiracy case that victimized thousands of investors across the nation who bought shares in Petro America Corp., which was purported to have over $284 billion in assets.
Charles Hooker, 50, pleaded guilty to participating in a conspiracy to commit securities fraud and wire fraud. Prosecutors say that Hooker is subject to a sentence of up to five years in federal prison without parole, plus a fine up to $250,000 and an order of restitution.
A sentencing hearing is scheduled for Nov. 13, 2012.
According to court documents, Hooker was a team leader who recruited investors and sold shares of stock for Petro America. Prosecutors say that contrary to the fraudulent representations Hooker and others made to victim-investors, Petro America had no oil, no realistic prospects for obtaining, transporting or storing large amounts of oil, no significant assets, no revenue and no employees other than the CEO.
Prosecutors say that Hooker knew the Petro stock shares were not registered when he started selling them. Hooker has never been licensed to sell securities and did not check with the state of Missouri or with the Securities and Exchange Commission (SEC) to determine whether the company was registered, or whether it was legal for them to sell shares. After Hooker found out about the Missouri cease and desist order, prosecutors say that he never contacted state regulators or an attorney to find out if it was legal to sell the shares.
Today’s plea agreement also refers to an investor in Beverly Hills, Calif., whom Hooker persuaded to invest $150,000 in Petro America.
Prosecutors say that many of the victims in the Petro America scheme were regular churchgoers, and word about Petro spread through Kansas City area churches, as the ministers told their friends. Hooker, a minister, attended meetings of the Minister’s Alliance. Prosecutors say that Hooker wore white fedora hats and made choreographed entrances into places.
Some members of the Minister’s Alliance were gifted shares of Petro stock for them to sell. Prosecutors said in court that Hooker did not purchase shares of Petro, but was gifted 80 to 90 million shares for bringing in investors. Hooker sold those shares for $100 for 100,000 shares.
By April 2010, Hooker had sold all his shares and began selling shares that had been gifted to co-defendant Teresa Hill, 55, of Kansas City, Mo.
Hill, who was also a team leader, has pleaded guilty to her role in the conspiracy. The proceeds that weren’t spent were kept at the house, not in a bank. According to court documents, Hooker did not use a bank account and dealt mainly in cash.
Prosecutors said that Hooker and Hill sold their shares together in concert. A total of $67,258 in cash went into Hill’s accounts in 2007 and 2008. After that period, prosecutors claimed that Hooker received at least $25,000 from the sale of Petro shares in concert with a co-defendant, the Rev. Edward D. Halliburton, 57, of Kansas City, Kan., who was president of the Minister’s Alliance.
Prosecutors say that the minimum loss attributable to Hooker and Hill’s conduct is $77,000, and the maximum is $144,258.
Hooker is the sixth defendant to plead guilty in this case. Hill; Halliburton; Allen Collins, 55, of Raymore, Mo.; Joseph Harrell, 50, of Waco, Texas, who acted as the CFO of Petro America; and Russell Hopkins, 48, of Tuscaloosa, Ala., have also pleaded guilty to participating in the conspiracy.