Ex-oil boss facing prison term after deceiving investors
Friday 24 December 1999
The conviction of John O'Brien brings to a conclusion an intriguing case which has lasted four months. The court heard the oil boss gave advisers a tour of an oil well which he pretended belonged to the company, while O'Brien's secretary told the court lying was standard practice in the City.
O'Brien was convicted of two offences of forgery and two of false accounting in 1994 and 1995, when the company successfully raised pounds 7.2m in a rights issue to fund drilling in Lousiana. He had a stake in the company held in off-shore accounts.
Anthony Shaw, QC, for the Serious Fraud Office, said Williams de Broe, the company's advisers, had not been told the company's flagship well, Valentine 14, had proved to be dry and Alliance's lease to exploit the oilfield had expired.
"If they had seen Valentine 14 in March 1995 sitting in a pond amid mud and debris, it would have been a disaster," he said. "[O'Brien] instructed they be shown another well and pretend it was Valentine 14. The deception was successful."
The real Valentine 14 well was standing in "a duck pond", incapable of producing sufficient gas even "to fill a cigarette lighter".
The court also heard that O'Brien instructed his secretary to fabricate letters to make it look as though Alliance had struck a deal to sell gas from the field. Christine Allan, who was granted immunity from prosecution by the SFO, told the court she had sought to protect O'Brien.
O'Brien, who now runs a hotel business after being removed in a boardroom coup in 1995, is to be sentenced in February. He was cleared of one charge of forgery. Judge Peter Fingret discharged the jury from returning verdicts on two further charges of forgery and two under the Financial Services Act after the jurors failed to reach a verdict.
Throughout the case O'Brien claimed he was the victim of a fraud being run by a colleague. He said he had never claimed Valentine 14 was productive.
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