SEC Seeks Subpoena Enforcement in $42.7 Million 1859 Oil Offering Probe
SEC seeks to compel 1859 Operating, five affiliates and six people to answer subpoenas in a probe of a possible $42.7 million oil offering fraud in Texas.
Summary
In Litigation Release No. 26616, dated August 21, 2026, the SEC said it filed Misc. Action No. 4:26-MC-00012 on August 20 in the Northern District of Texas against 1859 Operating, LLC, Centerfire Consulting, LLC, DMMD Marketing, Inc., DM Sales Consulting, Inc., The Slade Group, Inc., Slade Marketing, Inc., Adam Fieldsted, Dillon Murrow, Alison Slade, Dallin Slade, Duane Slade, and Mason Slade. The agency seeks an order compelling compliance with investigative subpoenas concerning possible federal securities law violations tied to 1859’s sales of fractional undivided working interests in oil leases, through which respondents allegedly raised approximately $42.7 million.
The SEC began issuing subpoenas in April 2024 for documents and sworn testimony. Its application alleges that, despite extended deadlines, repeated communications, and production-priority agreements, respondents produced about 8,344 documents from a universe their counsel described as potentially hundreds of thousands or millions. Several respondents allegedly missed agreed or subpoenaed testimony dates, while counsel repeatedly canceled sessions shortly before they were scheduled during the past 10 months. The court will consider the requested compliance order as the SEC continues fact-finding; the agency has not concluded that any respondent violated federal securities laws.
Positives
- The SEC has not concluded that any respondent violated federal securities laws, leaving the matter at the fact-finding stage.
- Respondents have produced approximately 8,344 documents in response to the investigation, although the SEC alleges that substantially more may be responsive.
- The SEC requested a federal court order to resolve compliance with the outstanding document and testimony subpoenas.
Risks & concerns
- Approximately $42.7 million was raised through oil lease interests now under investigation for possible offering fraud and other securities law violations.
- Only about 8,344 documents were produced from a potentially responsive universe described by respondents’ counsel as hundreds of thousands or millions.
- Several respondents allegedly failed to attend testimony on agreed or subpoenaed dates.
- Respondents’ counsel allegedly canceled scheduled testimony shortly beforehand multiple times over the past 10 months.
- The SEC alleges near-total noncompliance despite extended deadlines, repeated communications, and agreements to prioritize production.