KANSAS CITY, Mo. (AP) -- The founder of Petro America Corp. has little chance of prevailing in a $100 million civil lawsuit he filed against prosecutors and the Department of Justice after a federal jury convicted him on six counts of felony fraud, a former federal prosecutor said.
Isreal Owen Hawkins, 57, and other company leaders were accused of security fraud and conspiracy for falsely claiming the company had $284 billion in assets, illegally selling the stock and pocketing more than $10 million in proceeds. Prosecutors said Petro stock was as worthless as "used Kleenex."
In the civil lawsuit filed in April, just days before the start of the criminal trial, Hawkins held that assistant U.S. Attorney Daniel Nelson, IRS special agent Devin Fields and the Department of Justice had committed prosecutorial misconduct by ignoring evidence that proved Petro America had billions of dollars of assets.
After hearing more than three weeks of testimony, jurors convicted Hawkins and four co-defendants Wednesday of a total of 15 felony counts. Hawkins, of Kansas City, Kan., was immediately taken into custody, pending a bond hearing Tuesday.
The result of the criminal case doesn't bode well for his civil case, former U.S. Attorney Todd Graves said Friday.
"If he's alleging prosecutorial misconduct and has been convicted, his chances are slim and none, and slim just left town," Graves said. "Nothing is an automatic, but that's about as close to an automatic as you can get."
Don Ledford, a spokesman for U.S. Attorney Tammy Dickinson, said prosecutors could file a motion to dismiss or seek other resolution, any of which would require a judge's ruling.
"The lawsuit has to get resolved one way or another," he said.
Hawkins, who founded Petro America in 2007, called it the "People's Company" and told shareholders he expected to be awarded a Nobel Prize for creating such vast wealth for average folks who didn't otherwise have access to the American dream. He said the government's sole intent was to destroy Petro, a contention he also made during the criminal trial in which he represented himself.
"Mr. Hawkins, he's a standup guy," he told jurors in closing arguments. "He doesn't run from big government."