SMI Private Equity (Stein Morgan International)
Offering Oil and Gas Investments

SMI Private Equity, and firms like them, have in the past restricted themselves to hawking old and tired penny shares and involving themselves in second wave scams, whereby the boiler rooms offer to sell on worthless stock, for an up front fee. They will take the fee of course, and you will never see a return.

It appears that firms like SMI Private Equity (Stein Morgan International) are venturing into other fields, noteably Oil and Gas, and investors need to be vigilant, especially when dealing with firms such as SMI Private Equity.

Oil and Gas has long been plagued with 'promoted' investments. A typical oil and gas fraud is to mark up the cost of the well 300 to 500%, with the Operator and/or sales firm pocketing the difference.

Even IF the well comes in they tend to tell the investors they are dry holes, and cap them off. Since they've already made their money from investors they don't want to work the well, having to report to investors and possibly exposing the massive dilution of any potential returns.

There is a warning about Stein Morgan Intenational (SMI) with the FSA in the UK.

There is a thread on SMI Private Equity at the Boiler Rooms UK forum.

More information on some of the pitfalls of oil and gas investments can be found at the Venture Research Institute.