PRESS RELEASE FOR IMMEDIATE RELEASE
Contact: Lori Sitler
Phone: (302) 577-8314
Pager: (302) 247-1132
Date: October 2, 2003
AFFINITY FRAUD PERPETRATORS CONVICTED
(Wilmington, DE): Attorney General M. Jane Brady announces the recent convictions of Joseph Olive and Glenn Kinsey on charges stemming from their affinity scheme to convince investors to back an oil exploration project in Israel.
Joseph E. Olive, a Delaware resident, and Glenn Kinsey, a New Jersey resident, established a Delaware limited liability corporation by the name of Covenant Energy in 1999 to promote a non-existent oil exploration venture in Asher, Israel. This site was chosen because Deuteronomy 33:24 recounts how the tribe of Asher will “dip his feet in oil.” Olive and Kinsey claimed that Covenant Energy LLC had progressed in the drilling phase of the project. To do so would require a permit or license from the Israeli government. Israeli Petroleum Law requires business entrepreneurs to obtain either preliminary permits, which allow for investigatory work but no drilling, or exploratory licenses, allowing the holder to obtain a lease through the Israeli government upon making a petroleum discovery. However, the Israeli Ministry of National Infrastructures confirmed that neither Olive, Kinsey nor Covenant Energy LLC received an oil right in that country and did not perform oil exploration activities.
The financial analysis conducted by the Delaware Securities Division revealed that none of the $70,000 raised by Covenant Energy was used for oil exploration purposes. Rather, the majority of Covenant Energy checks were written out to the corporate officers. A legitimate oil exploration project would have cost several million dollars, not the small sum raised by the defendants. No return on investments were ever made to the victims.
The defendants convinced at least nineteen investors, one of whom was from Delaware, to buy a stake in the Israel oil scheme by convincing them that the project was heavenly blessed. Olive represented that, “I have placed everything I personally own on the line with this Project only because I believed what I read in God’s Word and that he was leading me in that direction. I would find it hard to believe that God would take me this far and let me fail.” Individual investments ranged from $2,500 to $10,000.
On September 29th, Joseph Olive plead guilty to one count of Securities Fraud and was sentenced by Judge Charles H. Toliver, IV to one year incarceration suspended for one year of probation. He was ordered to pay restitution to the Delaware victim, and refrain from the offer or sale of securities in Delaware unless properly licensed.
On September 30th, Glenn Kinsey pled to 3rd degree conspiracy. He was sentenced by Judge Peggy Ableman to one year incarceration suspended for one year of probation. He is to pay restitution to the Delaware victim along with his co-defendant Joseph Olive, and refrain from the offer or sale of securities in Delaware.
In commenting on this type of securities fraud, Attorney General Brady said, “to exploit a connection with a victim, through a common religion or other type of affiliation, for unlawful gain is unconscionable. The fraudulent sale of securities and theft of investor funds are crimes. We encourage
Delawareans to investigate before they invest. By calling us at (302) 577-8424, we can verify whether a broker and investment product are registered.”
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