Oil Firm Is Subject of FBI Inquiry Into Allegations of Mail, Wire Fraud
The FBI is investigating allegations that the little-known Bass Oil Co., whose last known address was in Canoga Park, committed mail and wire fraud, reportedly in connection with an oil and gas venture in Kentucky.
Details of the investigation were unavailable, and Bass Oil President Donald E. Bass could not be reached for comment. But Los Angeles FBI spokesman John Hoos confirmed that an inquiry is under way.
“We do have an ongoing investigation into allegations regarding possible violations of fraud by wire and mail fraud statutes,” he said.
Public records and interviews with public officials in California and Alaska give only a sketchy picture of Bass Oil’s business.
In March, Bass applied to the California Department of Corporations for a license to solicit investors, said Melinda Brun, a senior trial counsel with the department. But she said the company was rejected as being unqualified for soliciting in the oil business.
About the same time, Bass briefly attempted to become a partner in a series of oil and gas leases controlled by Alaska Land Leasing Inc. of Brentwood, said Ann Prezyna, a deputy attorney general in Alaska. Alaska Land Leasing acquired the leases for about $200,000 and sold portions of them to investors for a total of $6.8 million, she said.
Alaska Land Leasing was sued by the Federal Trade Commission in 1983 and subsequently was forced into receivership.
Sheldon Jaffe, the receiver, said Bass Oil contacted him last year and offered to pay the rent due on the leases to keep them from expiring, in exchange for whatever rights Alaska Land Leasing retained in them. But he said Bass never pursued the matter.
Prezyna said that, just before March 1, when the leases were to expire, Bass sent the state a check for $196,000, the yearly fee required to keep the leases alive. But Bass stopped payment before the check could be cashed, she said.
When the check came in, Prezyna said, she contacted the company’s California bank and found that there was not nearly enough money in the account to cover it.
Ed Watkins, a securities examiner with the attorney general’s office in Alaska, said he had received information that Bass was contacting investors in Alaska Land Leasing about the leases but that it was unclear whether Bass was soliciting funds.
Officials said no oil or gas exploration is being conducted on the land.