UPDATE: Jeff Rand Pleads Guilty in Oil, Gas Scheme

by Gwen Moritz  on Tuesday, Jun. 28, 2011 3:11 pm  

Former Hot Springs resident Jeffrey Rand pleaded guilty to a single count of mail fraud in U.S. District Court in Fort Smith Tuesday, more than three years after he was indicted on 25 counts related to an oil-and-gas scam that ensnared dozens of investors, including some Arkansans.

Rand's plea agreement stipulates to more than 10 but fewer than 50 victims and losses of more than $2.5 million but less than $7.5 million, U.S. Attorney Conner Eldridge confirmed to ArkansasBusiness.com.

Rand faces up to 20 years in prison, although the sentencing guidelines suggest that he will probably serve four to six years.

Rand had been scheduled for trial beginning next week, but he pleaded guilty before U.S. District Judge Robert T. Dawson after a pre-trial hearing that had been ordered last week. Dawson had issued an arrest warrant for Rand on Friday after the court was informed that Rand had "failed to provide a valid address to the pretrial services officer since at least February 2011, and his current whereabouts are unknown."

Rand, who grew up in North Little Rock, had left Hot Springs for Houston, where he ran the oil and gas company through which he committed his crime, Wave Energy. According to Eldridge, Rand had most recently been living in Washington state.

“Jeff Rand defrauded numerous investors in Arkansas and across the country of millions of dollars," Eldridge said in a press release issued late Tuesday afternoon. "He falsely and fraudulently sold ownership interests in a gas well to these investors when he did not, in fact, own an interest in that well. Mr. Rand continued to misrepresent his ownership and involvement in this project in order to solicit additional funds from investors. With his conviction today, Mr. Rand has been brought to justice for the fraud he perpetrated. In the Western District of Arkansas, we will continue to vigorously prosecute individuals that swindle money from others through fraud and deceit.”

Also commenting in the release was Ted Holder, a staff attorney for the Arkansas Securities Department who did the initial investigation of Rand's scheme: “This case shows how several agencies working together can bring justice to someone responsible for a very large and complex fraudulent scheme.” 

Dawson ordered Rand to surrender his passport but allowed him to remain free until sentencing, as long as he doesn't leave the Western District of Washington without prior approval from his probation officer.

Eldridge said the sentencing should come in four to six weeks, but it has not been set pending a routine pre-sentence report.

Rand was represented in his plea by Hot Springs attorney Morse U. Gist Jr. The federal prosecutors were Kenny Elser and Steven Snyder

Rand's father, W.A. "Tony" Rand, and brothers have also pleaded guilty to unrelated oil and gas scams in Texas.

Previous reporting on Jeff Rand:

Former Hot Springs Resident Accused of Securities Violations in Gas Well Deals

Rand Brothers Disappoint Investors



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