Mark Christopher Parman of Frisco, who raised approximately $850,000 from investors in oil and gas projects, was sentenced to six years in state prison on April 7 after pleading guilty to securities fraud in the 199th State District Court in Collin County.
Parman sold interests in oil and gas drilling projects in Grayson and Brazoria counties in Texas and Jefferson Davis Parish in Louisiana. He promised investors he would use their money to pay for oil-and-gas development projects, but instead used funds to pay for his and his wife's personal expenses.
The oil and gas projects were supposedly managed by Intercontinental Energy Inc., a company Parman controlled. Neither the company nor Parman were registered to sell the investments.
Parman committed securities fraud by not disclosing his past sanctions and legal proceedings to investors to allow them to make an informed decision.
In 2003, Parman and Shelman Securities Corp., where he was chairman of the board, were ordered to pay $1.7 million in restitution to individuals who were sold limited partnership offerings in an investment fund. The arbitration, conducted by the National Association of Securities Dealers (NASD, now the Financial Industry Regulatory Authority), revoked Shelman Securities’ license as a broker-dealer and Parman’s license as a securities dealer.
A second NASD arbitration proceeding in 2004 awarded $311,572 to an investor who filed a complaint against Shelman Securities and Parman. The complaint alleged excessive trading to generate commissions, a practice known as churning. Also in 2004, the Colorado Securities Commissioner revoked the broker licenses of Parman and Shelman Securities to sell securities in Colorado.
In addition, Parman in 2005 filed for Chapter 7 bankruptcy in the Northern District of Texas, Dallas Division.
Parman was also briefly jailed for contempt of court in 2005 in Collin County after refusing to answer discovery questions from a plaintiff who sued Parman and a business associate for not paying a debt.