Island man accused of defrauding investors requests hearing

mmcnab@beaufortgazette.comJune 7, 2013 

A Hilton Head Islandman accused of using his investors' money to pay for personal expenses has requested a hearing to dispute those accusations, according to the S.C. Attorney General's Office.

Spokesman Mark Powell said John McIntyre requested a hearing with the office last week. A date has not been set, Powell added.

Had McIntyre accepted the findings of the office's Securities Division, he could have opted to pay a flat $50,000 civil penalty. By contesting the findings, McIntyre risks paying as much as $10,000 for each of the 39 securities violations of which he is accused, as well the cost of the attorney general's investigation.

Powell said McIntyre's case has been referred to the attorney general office's criminal investigation division, but he was unsure if or when criminal charges would be filed. He also said he did not know if the criminal investigation had begun.

The attorney general issued a cease-and-desist order to McIntyre and his Silver Oak Land Management in April for allegedly using investors' money to pay for personal expenses, such as shopping trips and pet care.

The Securities Division's investigation concluded that McIntyre siphoned investors' money from Silver Oak Energy, a startup biofuel company and subsidiary of Silver Oak Land Management.

Five of the investors, all with ties to the Hilton Head area, collectively paid nearly $400,000 for about 70 acres in Marlboro County to set up a farm to grow giant Miscanthus grass, a renewable energy source.

The business plan, according to one investor who asked not to be identified, was to grow and harvest the grass, then sell pellets of it to companies in Europe for use as a coal alternative.

McIntyre is accused of mislabeling expenses on reports to investors to conceal how he used their money, according to the order. For example, money that McIntyre spent at Victoria's Secret was entered as dinner at "Vic's on the River," according to the order.

A separate legal action -- a lawsuit filed against McIntyre in October by the five local investors -- says Silver Oak Energy was launched in 2009 using $398,000 provided by the investors. The plaintiffs are Paul Finn, James Paris, Brian Mone, David Short and Richard Silver.

Silver, a Daufuskie Island resident, said that suit is on hold until the attorney general's hearing is resolved.

Attempts Friday to reach McIntyre's attorney Robert Mathison Jr. were unsuccessful.

Follow reporter Matt McNab at twitter.com/IPBG_Matt.

Related content:

Hilton Head investors defrauded, says AG's office, May 11, 2013

Investors in Hilton Head green energy firm sue former manager, Oct. 12, 2012

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