Kentucky businessman convicted in pipeline scheme
BOWLING GREEN, Ky. (AP) – A Kentucky businessman has been convicted of defrauding people who invested in a natural-gas pipeline in Tennessee.
Media reports say Clay Shelton was convicted of wire fraud, money laundering and securities fraud. Shelton faces up to 20 years in prison.
The Bowling Green man was charged with soliciting $1.37 million from 11 investors to use in buying the Monterey Pipeline in Tennessee. Shelton allegedly told investors their money would be held in escrow to secure a loan.
The indictment said Shelton told investors that after the loan came through, they would get their money back plus 25 percent, or the pipeline company would buy their interest in Tennessee wells.
Court documents say Shelton instead used the money for other purposes, including an investment in collateralized mortgage obligations that lost money.