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Thursday, February 6, 2014

Federal Prison Sentences Handed Down for Landmen Found Guilty of Fraud

From the Pittsburgh Post-Gazette:
The plan was ingenious: Find forgotten properties with absent owners who probably hadn't even thought about the gas trapped deep in the shale below. Forge deeds transferring the gas rights to official-sounding companies, then sell them to drilling firms.
Derek A. Candelore, 34, of Jeannette and William J. Ray, 30, of Monroeville got the idea while working as "land men," securing legitimate rights to Washington County gas for a real company. Fake rights proved more lucrative, bringing them $2.4 million over a year and a half, and maybe they convinced themselves they were doing no harm.
"It was finding rights to gas that people didn't know they had," said Robert Stewart, the defense attorney for Ray. "So you lie to yourself: Well, they didn't know they had it, so they'd never know they lost it."
U.S. District Judge Arthur J. Schwab on Friday sentenced Candelore to three years and four months in prison, and Ray to one year and eight months. Both have to repay their victims and face federal probation after release.
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