Securities Lawyers Blog
The law offices of Gana Weinstein LLP are currently investigating claims that advisor Todd Esh (Esh) has been accused by a financial regulator of engaging in the fraudulent sale of securities among other allegations. According to records kept by The Financial Industry Regulatory Authority (FINRA) Esh was employed by his prior employer LPL Financial LLC (LPL Financial) prior to being investigated concerning his activities. If you have been a victim of Esh’s alleged misconduct our firm may be able to assist you in recovering funds.
In April 2020, The SEC brought an action in the U.S. District Court for the Western District of Missouri, Western Division against Todd Esh and others. The SEC alleges that the defendants engaged in a fraudulent securities offering orchestrated by Phillip Hudnall, with help from Esh, operating through BirdDog Business, LLC and BirdDog Oil Equipment entities that Hudnall and Esh founded and controlled. According to the SEC, Hudnall and Esh raised more than $3.6 million by selling promissory notes issued by BirdDog to investors. Esh and other allegedly promised that they would use investor funds to buy and refurbish used oil and gas equipment which BirdDog would then resell at a profit. However, the SEC claims that Hudnall misappropriated most of investors’ money and squandered the rest on a bogus equipment deal.
The SEC claims that the defendants promised that the notes would pay a 30% return after just nine months to investors and also emphasized the safety of the investment, promising investors that their principal would be secured by a first priority security interest in specific oil and gas equipment. Hudnall and BirdDog further assured investors, according to the SEC, that they had experience and had done these sorts of transactions before. In offering materials provided to investors the defendants highlighted two purportedly profitable equipment transactions that they had already completed. But the SEC determined that these representations regarding previous deals were lies and, the two completed transactions described in BirdDog’s term sheet were fake. In addition to misrepresenting their experience, the SEC found that defendants were not using investor funds as promised. In fact, the SEC claims that defendants made only one attempt at investing BirdDog’s funds as promised ending in a spectacular failure.