This week, it was announced that a federal grand jury had charged a Sulphur, Oklahoma man with defrauding Chesapeake Energy of more than $4 million using fraudulent invoices. 41-year-old Justin Lane Foust was charged in an eleven-count indictment, which was unsealed on Friday afternoon. The defendant was employed by Chesapeake Operating Inc., which is a wholly owned subsidiary of Chesapeake Energy, from April of 2002 until September of 2011.
In July of 2011, the defendant formed Platinum Express LLC. The company became an approved vendor for Chesapeake Operating in October of the same year. The indictment alleges that Chesapeake contracted with Platinum Express to transport waste water to disposal facilities in western Oklahoma. The defendant is charged with defrauding Chesapeake by causing Platinum Express to submit false invoices for services that it did not perform.
More specifically, the indictment claims that Foust created fraudulent work tickets for steam cleaning, dirt berm work, plating trucks and other services. The defendant allegedly created many fraudulent invoices for amounts just under $5,000. The defendant knew from his time with Chesapeake that such transactions required a lower level of approval for processing and payment. The indictment alleges that Foust either forged or electronically copied and pasted the signature and employee ID number of certain Chesapeake employees to ensure that the company would process the invoices.
The defendant allegedly caused the work tickets and invoices to be submitted through interstate wire communications to Oildex. Foust is accused of submitting more than 1,100 fraudulent invoices and generating more than $4.3 million in payments to which Platinum express was not entitled. At this point in time, the defendant remains innocent until proven guilty beyond a reasonable doubt in a court of law. Additional details regarding the charges can be found here.