Basics

Tax credit allowed: 20% of amount invested for urban investments (counties with >100,000 people)

Tax credit allowed: 30% credit of amount invested for rural investments (counties <100,000  people)

Has a capitalization of not less than 1 million dollars, (or 500 thousand for the rural credit)

Has not invested more than 20% of its capitalization (25% for rural tax credits) in any one company at any one time

End investment must be to qualifying Oklahoma small business venture that:

Needs financial assistance to commence or expand such business which provides or intends to provide goods or services

Qualifies as a "small business" under Small Business Administration guidelines

Is not primarily engaged in oil & gas exploration, real estate development, real estate sales or rentals, wholesale sales, retail sales, farming, ranching, banking, or lending or investing funds in other businesses.

Has a Standard Industrial Classification code under any Major Group Number of Divisions A, C, D, E, F or I, with the following exceptions:

• Major Group 1 of Division A
• Major Group 2 of Division A

Expends at least 50% of the proceeds of the qualified investment for the acquisition of tangible or intangible assets within 18 months after the date of the qualified investment

For the rural tax credit, the principal place of business must also be located within a Nonmetropolitan area of the state & deriving 75% of its gross revenue from a NMA.

Small business venture may not use invested funds to acquire 51% or more of any other legal entity within six months of investment.

See for yourself. For complete details download the act in PDF format. Download

1. Money at risk: means exactly that. The amount of the investment investors could loose if the venture fails.
2. The fact tax credits are used is very significant.
3. Fraudster safe as oppose to fraud safe. The act provides
• maximum protection for protecting the identity of those participating in the fraud.
• no protection for the public.
• Void of clearly stated performance measures without a standard by which to measure success or failure.
• No one is tracking performance measures such as how many jobs were created.
• no laws that fraudsters can violate. Any caught doing wrong will not be allowed to participate again the future, but are allowed to keep the money they stole.
• a criminal offense punishable by up to one year in jail for releasing any information that might lead to the identity those participating in the fraud.

Example: The Quartz Mountain Aerospace project was seeking $32 million. Altus Ventures using a financial shell game inflated the amount claimed to be $221 million in order to receive $66.3 million in tax credits from the state. Altus Ventures investors who appeared to be risking $32 million were actually receiving $64 million ($2.3 million went to shell gaming fees) in taxpayer money.

Quartz Mountain Aerospace, like two other similar scams Great Plains and Rocketplane started failing from the git-go. It mattered not because "Venture Counterfeit Cronies" were guaranteed in tax credits, $2 to $5 for every $1 invested long before they filed the claims. Actually $3 or $6 for $1 since they keep the investment, and the $2 or $5 is all incentive. The business venture thingy is only for appearances in when the IRS comes snooping around.

Note: At this point we have not investigated all the actual business ventures to determine their direct involvement. The scam can operate without any direct involvement by the business venture. Based on what we have learned it appears that it is a mixed bag, and many business ventures have some level of knowledge and involvement. While others had no knowledge and were blind sided. One example came to light when E-Z ????? filed a lawsuit.

To make this look legit the middle men are referred to as Venture Capital Companies. It should be noted anyone can label themselves a "Venture Capital Company." The good Venture Capital Companies are evaluated under a microscope by large and knowledgeable investors who provide most of their funding. E.g., retirement funds, large companies, the very wealthy, etc.

The act was written with criteria to eliminate all the reputable and successful Venture Capital Companies, leaving "Venture Counterfeit Cronies" to feed at the public trough of greed. Oklahoma being void of any reputable and successful Venture Capital Companies, this was easily accomplished, one restrictive criteria being only "Venture Counterfeit Cronies" could participate.

We do have to give state officials credit where credit is due. They did demonstrate good insight by requiring that only the wealthy could participate. Otherwise anyone could have got in on the fraud. It obviously would not be smart to start allowing the common taxpayers to belly up to the trough of greed. That would leave no one to pay the taxes. You just can't have good public fraud without a tax base.

This gets much deeper so stay tuned as we peel additional layers off the onion, revealing how state agencies, state officials and names of those outside the government who are involved.

Other ways they protected the "Venture Counterfeit Crony" fraudsters.

The act requires that any business venture wishing to participate in this program must go through one of a small but very select group of crony Oklahoma "Venture Capital Companies." Only these "Venture Capital Companies" are eligible to apply for the tax credits. These "Venture Capital Companies" These crony "Venture Capital Companies" then use the tax credits to lure investors. In the end the "Venture Capital Companies" not only realize a huge windfall profit, all paid by the Oklahoma taxpayer, the "Venture Capital Company", not the investors, own a sizeable portion of every successful business. In theory this small group could own and control virtually all of Oklahoma's new business growth.

State subsidized money tree!

Hard to imagine when you read the bill, and see there were several issues that were covered in lengthy and specific detail.

• The criteria for a venture capital company to participate is written in a way to exclude all but a very small group of crony venture capital companies.
• That only the wealthy can participate.
• The most lengthy and detailed part of the bill is to protect the names and amounts of those receiving tax credits.

In addition to the protection the act gives

While void of the most fundamental protection for the public: