Eddie Lacy Stivers III was sentenced to 85 years in state prison on Jan. 31 for engaging in the fraudulent sale of stock and promissory notes, with some sales to investors coming after Stivers was indicted in Hood County on those charges.
In a separate case in Collin County State District Court, William Paul Hudson of Plano was convicted of theft in an oil and gas scam and sentenced to 10 years in state prison, also on Jan. 31. Hudson also received a sentence of 10 years, probated on charges of securities fraud and money laundering, and was ordered to pay restitution.
Dale Barron, an attorney with the Enforcement Division of the Texas State Securities Board, prosecuted Stivers with Hood County District Attorney Rob Christian.
Enforcement Division attorneys Tina Lawrence, Alexis Goldate, and Travis Iles served as the special prosecutors in the case against Hudson, which was done in cooperation with the Collin County District Attorney's Office.
Stivers received sentences of 85 years for first-degree securities fraud, 85 years for first-degree theft, and 20 years for second-degree securities fraud. The sentences, handed down in Hood County State District Court, will be served concurrently.
Even after his indictment in 2012, Stivers sold fraudulent promissory notes through a company called Life Style Protectors and Advisors LLC. His previous companies were Patriot Insurance Co. and Patriot Holding Co. According to an Affidavit for Evidentiary Search Warrant issued in Tarrant County, Stivers didn’t disclose to investors in Life Style Protectors that he had been indicted in Hood County.
Stivers also didn’t tell investors he had used their money to pay some of his and his wife’s personal expenses. He also made payments to his criminal defense lawyer with investors’ money.
Stivers sold investment contracts that supposedly would have given investors shares in Patriot Holding and Patriot Insurance and allowed them to participate in the profits of any affiliate company of Patriot Holding.
The son of one elderly investor in the fraudulent notes sold by Life Style Protectors testified that his mother, now deceased, invested more than $117,000 with Stivers and lost it all.
Hudson, the would-be oil well driller, stole approximately $600,000 from at least 50 investors in multiple oil and gas projects. One, the Gulf Coast Project, was supposed to re-enter existing wells in Jackson, Gonzales, and Jim Wells counties. Hudson and his company also raised money for projects unrelated to Gulf Coast.
Hudson directed only a small fraction of investor funds to oil and gas programs. He spent the majority of investors’ money to pay personal expenses.
Hudson already had a record of regulatory sanctions and bankruptcies before soliciting investors in 2007 and 2008. The Texas State Securities Commissioner suspended and fined Hudson in 2003 for selling unregistered securities, and in 2006 the Alabama Securities Commissioner entered a Cease and Desist Order for the same violation. Hudson and his wife had filed for bankruptcy three times from 1998 to 2007.
Hudson did not disclose his regulatory sanctions or bankruptcies to his investors.