Three men including a Texas state senator have been indicted by federal officials in connection with a fracking-sand scandal involving bankrupt FourWinds Logistics, Kallanish Energy learns.
State Senator Carlos Uresti was indicted along with CEO Stanley Bates of the San Antonio-based company, and FourWinds consultant Gary Cain on charges they operated a Ponzi scheme while marketing fracking sand to oil and natural gas drillers.
They are accused of lying to investors and using the money to pay earlier investors and for their own use, federal prosecutors said.
Uresti faces 11 federal charges including fraud and money laundering. The allegations surfaced after the company filed for bankruptcy in August 2015.
Uresti, a San Antonio attorney, was also named in a second indictment in a bribery scandal for a prison contract. Uresti and Vernon Farthing III of Lubbock, Texas, were charged in connection with a bribery investigation at the Reeves County Correctional Center in West Texas.
Federal prosecutors allege Farthing paid Uresti $10,000 a month as a marketing consultant and that half of the money went to an unnamed Reeves County official to award a contract for medical services at the jail to Farthing’s company, the San Antonio Business Journal reported.
Uresti issued a statement saying he is innocent.