Minnesota Oil Executive, 2 Others Charged In $30M Mail Fraud Scheme

MINNEAPOLIS (WCCO) -- The president of a Minnesota oil company is charged with manipulating his business's stock price to receive millions of dollars in bonus payments, according to the U.S. Attorney's office.

Prosecutors say 41-year-old Ryan Gilbertson founded Dakota Plains, Inc. in 2008 with a business partner, who the indictment did not name. The company reportedly offered cash investment opportunities and payments to shareholders that were tied to the company's stock price, of which Gilbertson took advantage. He also used his nonprofit corporation to take a stake in the investments.

Later, after the company's initial public offering, Gilbertson coordinated with 48-year-old Douglas Hoskins, a friend from his polo team, and 49-year-old Nicholas Shermeta, whom prosecutors say had a series of "bogus" consulting agreements with the company. At Gilbertson's direction, prosecutors say the two men purchased tens of thousands of shares -- at times with money Gilbertson gave to them -- in Dakota Plains and sold it for inflated prices.

The resulting manipulated price of his stock netted Gilbertson more than $12 million in bonus payments, and brought in a total of more than $32 million to other shareholders.

All three men are facing multiple counts of felony wire fraud.