Arizona utility regulators order Tucson company owner repay $7M to investors
PHOENIX — The Arizona Corporation Commission is ordering a Tucson solar company’s owner to pay more than $7 million in restitution for fraudulently offering and selling unregistered securities to foreign investors.
It was found Charles O’Dowd of ABCO Energy Inc. and others from 2011 through 2019 offered and sold the company’s securities offerings in the form of common stock and/or convertible preferred stock within or from Arizona to 81 foreign investors, according to the memorandum.
However, O’Dowd was not registered to sell securities in Arizona.
O’Dowd sought financing to grow the company quicker by providing the necessary capital to employ a sales and marketing team, but failed to disclose that a majority of investors’ funds went to pay commissions of a United Kingdom-based company that solicited foreign investors.
Investors collectively invested nearly $7.7 million and had only received back just about $33,000, according to the memorandum.
It was also discovered that O’Dowd intentionally did not disclose to investors the commission’s actions against ABCO Energy Inc.’s former CEO and CFO.
The company also in documents and correspondences with investors represented the company’s financial health as upbeat, when in fact the company’s audited 10-K financial statements from 2014 to 2019 indicated “growing concern.”
The Arizona Corporation Commission will disperse the funds on a pro-rata basis to investors, while any funds that cannot feasibly be disbursed shall be transferred to the general fund for the state, according to the memorandum.
O’Dowd must also pay a $75,000 administrative penalty.