Martin Tyson, Sr. of Horseshoe Bay, pleaded guilty to felony sale of unregistered securities on Feb. 23, 2010, and was ordered to pay $200,000 in restitution to 10 people who had invested in a purported Internet venture.
Judge Israel Ramon of the 430th District Court in Hidalgo County also sentenced Tyson to 10 years of probation, 160 hours of community service, and ordered him to pay a fine of $7,500 as part of his Order of Deferred Adjudication & Community Supervision.
Joe Rotunda, Chief of the Enforcement Division of the Texas State Securities Board, said as part of Tyson’s plea arrangement, the government dropped its felony charges against Tyson’s son, Martin Tyson, Jr. Rotunda said the plea will enable the victims to recover some of the money they invested with Tyson.
The Order of Deferred Adjudication requires Tyson to pay the $7,500 fine immediately, pay a $20,000 down payment on the restitution within 90 days, then begin monthly payments of $1,540 until the balance of the restitution is paid.
Steve Orr, the Austin attorney representing Tyson in the securities case, said his client never intended to violate the law and never lied to anyone. “The Tysons are very nice people who tried to obey the law.” Orr said the Tysons hired an attorney who is now disbarred to prepare the private placement before selling interests in the venture, but still violated “technical” aspects of the Texas Securities Act. Orr emphasized that the Deferred Adjudication does not constitute a conviction unless Tyson fails to honor the terms of the order.
On April 29, 2009, an Hidalgo County grand jury indicted the Tysons for failure to disclose material facts to thirteen individuals, mostly winter Texans, who purchased stock in companies controlled by the father and son related to “development of a software program for an online gambling website.”
Prosecutors alleged that the Tysons approached investors in 2005 with a plan to develop LetsPoker.com, a Web site that would allow U.S. citizens to gamble for money over the Internet. The indictments alleged the Tysons sold over $275,000 in stock in three corporations, including Panorama Global Realty Group, Inc., from February 2005 through February 2006 in violation of Texas law by failing to disclose to potential investors that “in and around December of 2005” they “became aware that there was a high probability that the United States Congress would be passing legislation making the business of on-line gambling illegal….”
Congress outlawed payments by U.S. credit card and bank companies to online gambling sites in October 2006. Since then, many online gambling sites set up operations outside the United States.
On May 6, 2009, Congressman Barney Frank introduced HR 2267 to overturn the federal ban on internet gambling and establish a federal regulatory and enforcement framework to license gambling operators in this country. The bill remains in committee and has not come up for a vote by Congress.
According to records of the Texas Department of Insurance, Tyson still maintains an “active” license to sell general lines of insurance in the state, and operates National Brokers, Inc. in HSB which advertises it offers “over 30 years experience” in “retirement and asset protection.”