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MISSOULA — A former Billings coal mining official who admitted defrauding companies of more than $20 million and lying to investigators about being kidnapped was sentenced today to five years in prison and three years of supervised release, U.S. Attorney Kurt Alme said.

Larry Wayne Price, Jr., 40, pleaded guilty in December 2018 to three counts of wire fraud, conspiracy to commit money laundering and false official statement.

U.S. District Judge Dana L. Christensen presided. Price was released and allowed to report to prison.

Restitution will be determined at a later date.

“The defendant’s crimes resulted in staggering financial losses and harm to many people, including some who lost their entire life’s savings, all so he could live in luxury. Today’s sentence is a warning to anyone considering looking for ‘easy money’ from others: You will be caught and you will go to prison. This case also serves as a reminder to all investors to be sure to do thorough due diligence before investing,” U.S. Attorney Alme said.

 The prosecution said in court documents that from October 2016 until April 2018, Price embezzled about $20,321,134 from three coal-related companies. Price was vice president of surface activities at Signal Peak Energy and also operated a private business called 3 Solutions, LLC, whose primary purpose was to supply chemicals to Signal Peak Energy. 

Price defrauded three coal-mining related firms: Ninety M, LLC, a Wyoming company of investors looking to invest in coal mining projects; Three Blind Mice, LLC, another Wyoming company with investors seeking to invest in mining; and Signal Peak Energy.

Based on his reputation as a coal mining expert, Price convinced Three Blind Mice to lend him $7.5 million, saying that 3 Solutions had a contract with a Pennsylvania coal company to install coal mining equipment. Price proposed that Three Blind Mice lend him the $7.5 million for expenses, and he would repay $11 million on Jan. 31, 2018. Three Blind Mice signed an unsecured promissory note and wired 3 Solutions the funds. Price defaulted on the loan. There was no contract between 3 Solutions and a Pennsylvania coal mine. Instead, Price spent the $7.5 million on unrelated expenses.

In another scheme, Price convinced Ninety M’s investors to appoint him as a company representative to help it buy and develop a coal mining property in Tazewell, VA, and to help develop other coal-related ventures. Price engaged in a series deals with other companies on behalf of Ninety M in which he solicited about $13.5 million from the firm, of which $10,475,000 was fraudulently obtained.

Meanwhile, as an employee of Signal Peak Energy, Price fraudulently induced the company to buy coal-related equipment from a firm knowing that the firm would not actually provide the equipment. The firm funneled the money to Price through a bank account registered to 3 Solutions. The scheme defrauded Signal Peak Energy of about $2,396,134.

In April 2018, the Ninety M investors began to question some of the transactions involving Price and had confronted him on the telephone. By then, Price had moved back to Virginia, his former residence.

On April 18, 2018, Price learned Ninety M was sending representatives to confront him about the fraudulent transactions. Price contacted a woman he knew and agreed to hide at a house the woman had rented.

The same day, Price’s wife reported him missing to Virginia authorities and local law enforcement responded. Late that night, Price was located on the side of the road in Gratton, VA., and was taken to a hospital for treatment and released.

In statements to law enforcement agencies, including the FBI and IRS, Price falsely claimed he had been kidnapped by men who may have been associated with an outlaw motorcycle gang. Price claimed the men took him in a van, threatened him and threw him from the moving vehicle onto the side of the road.

Price knew his statements about his alleged kidnapping were false and that he was not abducted by anyone. The false statements cost the government significant investigative resources and hampered the investigation into Price’s own wrongdoing.

Assistant U.S. Attorneys Colin Rubich, Zeno Baucus and Tim Tatarka, along with Assistant U.S. Attorney Randy Ramseyer, of the Western District of Virginia, prosecuted the case. The FBI, IRS and the Montana State Auditor investigated the case.

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