Ramsey business man indicted of fraud in federal court

A Ramsey business owner was indicted in U.S. District Court June 19 on several counts of fraud.

Bixby Energy Systems, Inc. founder Robert Allen Walker, 69, was charged in a superseding indictment with nine counts of mail fraud, five counts of wire fraud, four counts of securities fraud and one count of conspiracy to commit mail fraud, according to a U.S. Attorney’s Office press release.

Walker was indicted for allegedly lying to investors in an effort to induce them to commit large sums of money to his alternative energy company.

These charges are in addition to Walker’s prior charge of conspiracy to commit securities fraud, on which was he w as indicted Dec. 20, 2011.

From 2001 to 2011, Walker was the president, chief executive officer and chairman of the board at Bixby Energy.

In that capacity, he allegedly raised more than $43 million from at least 1,800 investors by offering company securities based on false or misleading information about the payment of salaries and commissions to Bixby officers and directors; the operational capability of Bixby’s core product, a coal gasification machine; and the prospect of conducting an initial public stock offering.

Walker also allegedly concealed from investors that new investor money was being used to make payments to existing investors and was being diverted to fund Walker’s lavish lifestyle.

To further his fraud, Walker allegedly told investors that Bixby officers and directors would not be compensated for selling company securities but then directed payments of at least $3 million to a company officer for doing just that.

From those payments, the officer then reportedly kicked back more than $600,000 to Walker.

This “commission sharing” arrangement was not only concealed from investors but from the company’s board of directors, according to the press release.

Walker also allegedly made repeated misstatements regarding the capability of the company’s coal gasification machine, characterizing it as “proven” and “ready for market,” when, in fact, the technology had never worked and the machine had substantial defects.

Moreover, the indictment alleges that Walker told investors the company was going to conduct an initial public offering of its stock in the near future, when, in truth, he knew it could not be done because, among other things, the company could not obtain audited financial statements.

Feb. 28, Gary Albert Collyard, who was a broker for the company, pleaded guilty to conspiring to mislead investors in an effort to induce them into committing large sums of money to Bixby.

His guilty plea included one count each of conspiracy to commit securities fraud and conspiracy to commit bank fraud.

From 2006 through May 2011, Collyard was a broker or finder of investors for Bixby and was responsible for raising funds for Bixby.

In December 2011, Bixby Energy Systems admitted defrauding investors of between $2.5 and $7 million and took responsibility for the acts of its former officers and agents.

In September 2011, Dennis Luverne Desender, who was a consultant and the former acting chief financial officer for Bixby Energy, pleaded guilty to securities fraud, admitting he used manipulative and deceptive practices in an effort to sell company securities.

If convicted, Walker faces a potential maximum penalty of 20 years in prison on each charge, except for the conspiracy to commit securities fraud count which has a potential maximum penalty of five years.

All sentences will be determined by a federal district court judge.

This case is the result of an investigation by the U.S. Postal Inspection Service, the Federal Bureau of Investigation, and the Internal Revenue Service-Criminal Investigation Division.

It is being prosecuted by Assistant U.S. Attorney Christian S. Wilton.

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