June 15 (Bloomberg) -- Daryl Hudson III, a former senior counsel in the U.S. Securities and Exchange Commission’s enforcement division, pleaded not guilty in federal court after being charged with seven counts of wire fraud.
Hudson, who is chairman and chief executive officer of Hampden Kent Group LLC, was arraigned yesterday in U.S. District Court in Albuquerque, New Mexico. He was indicted May 23 and faces as long as 30 years in prison and a $1 million fine on each charge if convicted.
Hudson, 59, of the District of Columbia, is accused of engaging in a scheme to defraud Santa Fe-based Bluenergy Solarwind Inc. by falsely representing that he could secure debt funding to help the company grow, according to a statement by New Mexico U.S. Attorney Kenneth J. Gonzales. He worked at the SEC from 1982 to 1985, according to the indictment.
In July 2011, Hudson accepted $85,000 as a partial retainer payment from Bluenergy, which hired him to secure about $80 million in debt funding for the company’s effort to begin manufacturing solar wind turbines. Hudson provided Bluenergy with a falsified receipt showing that investor funding was available, according to the indictment.
When Hudson was fired in August 2011 after the company raised questions about the legitimacy of the receipt, he refused to return the retainer, according to the indictment.
“The allegations in the indictment concern one disgruntled client who, over a three-week period, misled my client about its business and in fact could not demonstrate any product or revenues to obtain financing,” David A. Streubel, a lawyer for Hudson, said in an e-mail yesterday.
When the full story is explained in court, he said, “Mr. Hudson will be completely exonerated.”
The case is U.S. v. Hudson, 12-01250, U.S. District Court, District of New Mexico (Albuquerque).
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