2 guilty in oil drilling scam worth $33 million

AP News
Posted: May 11, 2011 7:50 PM
2 guilty in oil drilling scam worth $33 million

A federal jury found two Kentucky men guilty Wednesday on most charges in an oil- and gas-drilling scam that saw investors lose some $33 million. A third defendant was found not guilty.

The U.S. District Court jury deliberated about seven hours over two days before convicting Lexington attorney Bryan Coffman, 47, and Campbellsville businessman Gary Milby, 57, on multiple charges of mail, wire and securities fraud. Coffman was also convicted of money laundering and money laundering conspiracy.

Coffman's wife, Megan, 48, was found not guilty of all charges against her, all of them money laundering. He was found not guilty of two money laundering counts.

"Well, not a heck of a lot went right," said defense attorney Steve Romines, who represents Bryan Coffman.

During the trial that lasted nearly a month, Assistant U.S. Attorney Ken Taylor characterized the investments as operating like a pyramid scheme with payments from new investors being given in small amounts to longer-term investors with some people receiving no money at all.

Milby surfaced in the public eye when he threw his daughter a lavish Sweet 16 birthday party that was featured on MTV. The episode showed Milby giving his daughter a private helicopter ride, a new BMW and a shopping spree.

Prosecutors said the defendants spent their investors' money on cars, jewelry, yachts, parties and retirement accounts.

Both Milby and Bryan Coffman are free on bond pending sentencing Aug. 24. They face maximum sentences of 20 years in prison.

Milby attorney Robert Murphy told jurors this week that his client worked hard to find productive oil wells for his investors. He said Milby sometimes "told a lot of whoppers" when making sales but added that conduct isn't criminal.