A former Virginia advisor was sentenced yesterday to two years in prison for orchestrating an energy investment scheme that duped investors out of nearly a half million dollars, according to the U.S. Attorney's Office for the Eastern District of Virginia.

Ryan R. Riley, 50, of Brambleton, Va., also was ordered to pay $434,100 in forfeiture and $388,750 in restitution.

Riley pleaded guilty in March to defrauding at least nine investors between January 2014 and August 2019 of about $434,100 by making false promises about oil, gas, and energy investments through purported energy companies he controlled, prosecutors said.

According to a civil complaint filed by the Securities and Exchange Commission, Riley solicited individuals to invest in securities issued by his companies, Green Light Energy, LLC and Mustang Resources Inc. He told investors that their funds would be used to acquire, develop and operate oil and gas drilling projects in Texas. Riley also solicited clients of his advisory firm, Calibre Consulting Group LLC, the complaint said.

The complaint said Riley pooled the funds he received in bank and brokerage accounts he controlled and used the investors’ money for personal expenses, including mortgage payments and making risky day trades.

The complaint said Riley also lied about the status of his companies’ purported projects before and after he received funds from the investors. He responded to their inquiries by email and by text message, as well as on telephone calls and at in-person meetings, assuring them that projects were moving forward. He also would provide them with excuses for project delays, or avoided contact with them, the complaint said. “Riley’s explanations regarding project delays were false, because Riley had in fact never used investor or client funds for oil and gas projects,” the complaint said.

In one case, Riley induced an investor, who had worked for him as a plumber, to invest in a purported oil and gas project with Mustang. The complaint said in or about April 2019, the investor sent Riley a check for $40,000 for the investment after he was told that the investment was “100x better than [a] bank account” and carried little or no risk of loss. Riley, the complaint said, transferred $38,800 of the funds to his personal checking account and then moved $38,530 of the money to his brokerage account.

Separately, he received a $5,000 investment in Mustang from another investor, the complaint said. “Of the approximately $45,000 Riley raised through Mustang, Riley lost over $14,000 through day trading. He meanwhile used over $30,000 of these funds to pay for his personal expenses, including retail purchases and meals,” the complaint noted.

When asked by investors who had purchased Mustang securities about the status of the Mustang project, the complaint said, Riley claimed the project was delayed due to Covid-19 because the pandemic had made it difficult for foreign investors to visit drilling sites. It added that Riley also made small, purported interest payments to his Mustang investors, claiming these payments represented revenue from the project. But the complaint said the payments were made in large part with funds he had obtained from other investors and clients.

Riley started in the brokerage industry in 1996 with Smith Barney, according to BrokerCheck. He moved to UBS Painewebber in 2001 and was fired in 2001 for “telephone calls that were in violation of firm policy that were non-sales and non-compliant,” his record shows. Riley worked for a few other brokerage firms before giving up his license in 2010. He has been registered as an investment advisor since 2014 with Calibre Consulting Group in Leesburg, Va.

He was permanently barred by the SEC on May 15.