The former chief executive of a company that proposed conducting a seismic survey in Alaska’s Arctic Refuge was arrested in Anchorage on Friday on charges of wire fraud and securities fraud.
The federal charges are tied to Jeffrey Hastings’ work as CEO and board chairman of SAExploration, a Texas-based company that provides seismic data to the oil-and-gas industry. The company also has offices in Anchorage.
A complaint written by an FBI agent investigating the case — and unsealed on Monday — alleges that, between 2015 and August 2019, Hastings engaged in a multi-million-dollar scheme to deceive investors and artificially inflate the company’s revenue.
Hastings’ lawyer, Michael Dry, did not respond on Tuesday to requests for comment on the charges.
The 14-page complaint from the FBI details numerous allegations of financial wrongdoing.
Among them: It says Hastings made “false and misleading statements” to the U.S. Securities and Exchange Commission. It says he created a second company, Alaskan Seismic Ventures, as a way for SAExploration to take advantage of certain Alaska oil tax credits that it wasn’t eligible for. And, it says, he set up shell organizations to move money between the two companies so Alaskan Seismic Ventures could appear “independent and financially healthy.”
The complaint does not say whether the State of Alaska was defrauded, but according to SAExploration’s most-recent annual report, Alaskan Seismic Ventures collected millions of dollars in tax credits.
The report says the Securities Exchange Commission, Department of Justice and state Department of Revenue were investigating the company’s financial statements.
Colleen Glover, Alaska’s tax director, said the state considers tax matters confidential, so the department could not comment on any potential investigations. Reports from 2016 through 2019 show that SAExploration and Alaskan Seismic Ventures did not receive any cash from the state for oil and gas tax credits during those years.
Also, according to the FBI complaint, Hastings didn’t work alone.
The complaint says he conspired with three other now-former company executives who aren’t named in the complaint. At least one agreed to help law enforcement with the investigation.
The complaint says the four of them “misappropriated” more than $6 million of SAExploration funds for “their own personal use.”
In a brief written statement Tuesday, SAExploration spokeswoman Sarah Marshall said the company is now under new management and continues “to work hard to provide the same operational excellence that our customers have come to expect.”
Marshall said Hastings was put on administrative leave more than a year ago and then resigned.
SAExploration announced in 2019 that it was under investigation by the Securities and Exchange Commission for “certain accounting matters that arose in 2015-2016.” This August, the company filed for bankruptcy and said it reached an agreement with most of its creditors to restructure its debt, the Wall Street Journal reported.
Meanwhile, Hastings had his initial appearance in federal court in Anchorage on Tuesday. He had been jailed at the Anchorage Correctional Complex since Friday.
“We just don’t want him locked up for another night,” Hastings’ lawyer told the judge.
The judge said Hastings could be released on a $500,000 bond secured by $100,000 cash. Hastings’ next court date was set for October.