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NCHA MEMBER AND FORMER MEMBER ACCUSED OF FRAUD AND TAKING ADVANTAGE OF THE ELDERLY

 NCHA MEMBER AND FORMER MEMBER ACCUSED OF FRAUD AND TAKING ADVANTAGE OF THE ELDERLY

 

ED DUFURRENA CHARGED IN CIVIL COURT AND PHILLIP MICHAEL CARTER IN CRIMINAL COURT

By Glory Ann Kurtz
March 8, 2019

If it’s a lawsuit in the cutting horse industry, you would likely find that Ed Dufurrena, an NCHA million-dollar rider, who just last year was suspended from the National Cutting Horse Association, would be involved. In previous judicial filings, Dufurrena was accused of a host of violations, including but not limited to advertisement fraud by advertising Auspicious Cat as HERDA Negative when, in fact, the stallion was HERDA positive and taking advantage of the elderly. The suit, filed by Shawn, Lisa and Lauren Minshall v Ed Dufurrena and DOS Cats Partners, accused Dufurrena of fraudulent advertising the genetic status of the stallion Auspicious Cat. 

The second lawsuit filed against Dufurrena was filed by Don and Janie Vogel, a retired couple from Saint Jo, Texas, with a litany of alleged law violations of the Texas Deceptive Trade Practices Act, including fraud and taking advantage of the elderly.  The curious nature of this particular lawsuit includes the fact that at the time of the Minshall’s lawsuit, the Vogels also shared a secret 49 percent investor interest partnership in the DOS Cats Partners with specific horses as well as the same horse, Auspicious Cat, for their $105,000 investment.  

In filed Vogel court documents, it was revealed that they received a 49 percent share in the DOS Cats Partners, which included an investor-shared interest in specific horses for their initial $105,000.00 investment. The most notable of the shared investor interest was in Auspicious Cat and Stevie Rey Von the NCHA Futurity Champion. 

Both lawsuits were settled by Dufurrena in out-of-court settlements, except for the veterinarian David Hartman Equine settlement which went to trial with Dufurrena being found by the Jury to be 60 percent responsible for the damages that the Minshalls sustained in the case, even though Dufurrena had previously settled his portion of the lawsuit and was not included in this trial.  Another curious point is that Dufurrena has denied the Vogel’s interest in Stevie Rey Von but in review of certain invoices sent to me, including Dufurrena statements sent to the Vogel’s during the partnership, the invoices list the Vogels as an investment partner in Stevie Rey Von.  

The final lawsuit between the Dufurrenas and the Vogels entitled: Ed, Brandon and Rita Dufurrena (Plaintiff’s) versus Don and Janie Vogel (Defendants) was filed by the Dufurrenas in 2018 in Montague County, Texas, and came to a conclusion in 2019 with an out-of-court settlement between the Plaintiffs and the Defendants. No information is available in the judicial settlement.

Recently, the Dallas Morning News came out with an article about Phillip Michael Carter, 44, Frisco, Texas, who has part of a fraudulent real estate company for raising $44 million from over 270 investors in several states, most residing within the Northern District of texas, in unregistered securities offerings through materially misleading statements and omissions. It accuses Carter of misappropriating investor funds to pay off personal tax liens, fund his lifestyle and make Ponzi payments to investors.

The connection is that Carter, a money-earning member of the NCHA, has Ed Dufurrena as his cutting horse trainer, even though Dufurrena has been suspended from the NCHA. For the record, the attached photo is of Dufurrena and Carter together at the 2017 NCHA-approved Riverboats Cutting Horse Association show at the Texas State Fair, following Carter’s win of the $2,000 Limited Rider Class at this NCHA-approved event. The class sheets also indicate that Ed Dufurrena was an exhibitor at this NCHA-approved show, as well as Rieta Dufurrena who was entered in the Non-Pro Division riding Auspicious Cat while this horse was registered with the AQHA in the name of the DOS Cats Partners, the partnership where Don and Janie Vogel are listed as 49 percent vested-interest partners. The Vogels did not know the horse was being shown, let alone by a non-pro, when NCHA rules state that a non-pro must own the horse they show.

On January 25 of this year, Carter was sued by the Securities & Exchange Commission for fraud and money laundering. In a court document, Carter and several of his employees were accused by the Securities & Exchange Commission of duping a long list of elderly investors to the tune of $44-plus million!  In Carters previous arrest by the state of Texas for fraud in the same matter, he posted an $88,000.00 bond and was released from jail the same day. The other co-defendants in the case included his wife.

 

 

Phillip Michael Carter

Phil and Shelley Carter

According to an article in the March 7, 2019 Dallas Morning News, Phillip Michael Carter, who was the principal of Texas Cash Cow Investments and North Forty Development LLC used investor funds for personal expenses, including payments to the IRS.  Carter had used investor funds for paying personal expenses, including trips to Hawaii, and satisfying a personal IRS tax lien.  The indictment alleges that Carter had difficulty funding his projects and in December 2016, he wrote a $6 million check to pay for material and labor on several projects but the checks were returned for insufficient funds. Therefore, in October, he borrowed $32 million from a Seattle-based private equity firm to fund ongoing construction costs for two properties.  The lender holds the first lien on the properties, meaning investors are at risk of not receiving payments from the properties

But probably Carter’s worst offense was his neglecting to tell prospective investors about his accomplices within his company who were selling what were called “illegal securities” by the Texas Securities and Exchange Commission.

SEC legal case against Carter etal

 

Gregory Tillford

Carter failed to report to investors about several matters, including his accomplices’ backgrounds.  One accomplice, Richard Gregory Tilford, Arlington, Texas , allegedly told the mostly elderly investors that their money would go toward the development of residential and commercial real estate. An indictment also alleges that Carter and Tilford raised millions of dollars after the target letters from the U.S. Attorney’s office for the Eastern District of Texas, were received, a fact they did not disclose to the investors and the money had been sent to Carter and another accomplice Bobby Eugene Guess.

The fact was also concealed from investors that Tilford was a convicted felon even before selling the real estate development notes.  In the U.S. District Court for the Northern District of Texas in 2012.  Tilford pleaded guilty to failing to file a tax return and was sentenced to one year in prison.

Tilford-Richard-Gregory-INDICT-CollinCO

 

Bobby Eugene Guess:

Bobby Eugene Guess

Another accomplice Bobby Eugene Guess, Frisco, Texas, was sentenced to 12 years in state prison on July 3 for fraud in the sale of millions of dollars in securities in a worthless internet company. Guess pleaded guilty to securities fraud in May in the 296th State district court of Collin County. A Collin County Grand Jury indicted him on Dec. 15, 2016. Guess and his sale associates sold notes, stock certificates and investment contracts in Stamedia, an internet advertising compass that falsely claimed it had a valuable digital media patent. 

Guess and the other salespersons told investors the value of the patent allowed Stamedia to strike deals with large pubic companies such as AT&T Inc. and the Home Depot Inc. However, Starmedia did not have those contracts and and all told generated little revenue.

Guess is the founder and CEO of Texas First Financial l LLC in Frisco. He has not been registered to sell securities in Texas since 2011 but he continued to illegally sell allegedly high-yielding securities in various investment programs, including Stamedia.

The Collin County, Texas, District Attorney’s Office prosecuted Guess with the assistance of the Texas State Securities Board.The State Securities board first acted against Guess in August 2016. The Securities commissioner entered an Emergency Cease and Desist Order that required Guess to stop engaging in fraud in marketing promissory notes tied to a wide array of businesses. The emergency order cited Guess’ failure to disclose to potential investors the issuance and execution of the search warrant, among other violations of the Texas Securities Act.

Guess challenged the entry of the Emergency Order but failed to appear at a proceeding before at the State Office of Administrative Hearings.  A state administrative law judge entered a default judgment against Guess in September 2016.

Guess sentenced to 12 years in prison

IRONIC DETAILS:

Ironic details have emerged in this continuing Dufurrena Saga, including the “fraud and taking advantage of the elderly” details of both individuals. Philip Carter and Ed Dufurrena, seem to mimic each other’s fraud accusations in court filings, only they were selling a different product. Sharon Baker, who emerges as a Dufurrena client, penned a letter of recommendation for Dufurrena. In the NCHA hearings, it was discovered that she is the mother of Shona Dufurrena.  Also, in the most recent run-in with the NCHA, where Shona Dufurrena filed un-sportsman-like-conduct against fellow NCHA members over a dispute involving Ed Dufurrena, Phillip Michael Carter, the recently indicted and accused FRAUD, came to the aid of Shona Dufurrena at the latest NCHA special hearing. 

BUSINESS MODEL SIMILARITIES

In the Ed Dufurrena court filings, he was accused of fraudulent acts and taking advantage of the elderly.  Later research proved that he was operating two unregistered DBA’s (Doing Business As)  in the State of Texas which is required by law.  More specifically those unregistered DBAs were Dos Cats Partners and Dufurrena Cutting Horses.

In the Phillip Michael Carter indictments, he is accused of  a myriad of criminal acts to include but not limited to:  fraudulent acts, taking advantage of the elderly and operating an unregistered DBA entity in the State of Texas, as required by Texas Law,  In a later Federal filing by the Securities and Exchange Commission (SEC) this information is included therein.

For the record and as reported in this article Ed Dufurrena is the business associate of Phillip Michael Carter in the cutting horse business, i.e., Ed Dufurrena is Phillip Michael Carter’s professional cutting horse trainer.  However, as of the writing of this article and to my knowledge, Ed Dufurrena has not been implicated in the criminal filings of the Phillip Michael Carter saga.

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