SEC Obtains Freeze of Provident Officer's Assets

On December 3, 2009, the Securities and Exchange Commission obtained a temporary restraining order and emergency asset freeze against Joseph S. Blimline relating to his involvement in a $485 million offering fraud and Ponzi scheme. The alleged Ponzi scheme was orchestrated by Joseph S. Blimline, Paul R. Melbye, Brendan W. Coughlin and Henry D. Harrison through a company they owned and controlled, Provident Royalties LLC. The SEC previously filed a complaint against Melbye, Coughlin and Harrison and on July 7, 2009, obtained a temporary restraining order, asset freeze and appointment of a receiver with respect to those individuals.

The SEC alleges in its amended complaint that Provident advanced approximately $93 million of investor funds to Blimline and entities he controlled. The funds were for the purported purchase of oil and gas interests, or loans, to which Provident often never received title or repayment. The amended complaint also alleges that in presentations to investors and representatives of broker-dealers marketing Provident securities, Blimline failed to disclose his receipt of such funds, his involvement in the management of Provident, and a prior sanction imposed against him by the Michigan securities authorities for prior misconduct.

The SEC's amended complaint charges the defendants with violations of various Federal securities laws and seeks a temporary restraining order and preliminary and permanent injunctions, disgorgement of ill-gotten gains, plus prejudgment interest and financial penalties.

Dimond Kaplan & Rothstein, P.A. currently represents numerous Provident investors who appear to have lost tens of millions of dollars. The crux of the claims that Dimond Kaplan & Rothstein is bringing on behalf of investors is that the brokerage firms failed to perform adequate due diligence before recommending and selling the Provident investments or turned a blind eye toward obvious red flags that reflected the fraudulent nature of Provident. Either way, the brokerage firms recommended and sold Provident products without disclosing the fraudulent nature of the investments.

To determine if some or all or your Provident investment losses can be recovered, please contact attorney Jeffrey B. Kaplan of Dimond Kaplan & Rothstein, P.A. at (888) 578-6255 or jkaplan@dkrpa.com for a free case evaluation. You also may visit the firm on the web at [www.dkrpa.com] or [www.investmentfraud-lawyer.com].

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