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Securities News Releases
Monday, October 23, 2006
Contact: Stacie Temple, (573) 526-5076
Contact: Carrie Bebermeyer, (573) 526-0949
Consent Order Reached After Biofuel Company Jumps the Gun
Carnahan Encourages New Companies to Follow the Law
Jefferson City, Missouri -- Secretary of State Robin Carnahan's Commissioner of Securities Matt Kitzi entered into a Consent Order with Paseo Biofuels, LLC, on Monday, October 23, for that company’s failure to comply with Missouri law relating to the sale of securities.
According to the order, Paseo Biofuels held six investor meetings in north and western Missouri where it solicited investors before the company received its registration exemption on August 15, 2006. Missouri law prohibits the offering of unregistered and nonexempt securities to investors.
The Securities Division determined that 65 farmers who attended the premature investor meetings eventually invested in the company.
Under the terms of the agreement, Paseo was allowed to maintain its registration exemption after paying $24,000 in civil penalties, money to the Missouri Investor Education and Protection Fund, and investigative costs.
Carnahan emphasized the importance of complying with laws that are in place to protect Missouri investors and urged companies attempting to raise capital to follow proper procedures.
“No matter what type of investment is involved, the laws that regulate the offering of securities exist to protect investors,” said Carnahan. “In this instance, those laws were not complied with and were enforced by the Securities Division.”
Alternative energy filings have tripled in the Securities Division since 2005. Paseo is one of more than 15 biofuel, ethanol or other alternative energy ventures that has registered or sought an exemption for their securities offerings so far in 2006.
For more information regarding investments and fraud protection, or for information regarding a company or representative, call the Missouri Investor Protection Hotline toll-free at 1-800-721-7996 or visit the Secretary of State’s web site at www.sos.mo.gov/securities.