Regulators, Apply Here
A Texas oil promoter tells investors he made $40 million and that they double their money in a year. He told the SEC his flagship fund raised about $22 million. Two investors who put in $271,000 and got $26,000 back just sued. Here’s what the public record shows.
Let me start with the gap that made me keep digging.
In a video he uses to court investors, Brent Franklin — founder of a Houston-area oil-and-gas shop called Rise Capital Group — claims that across all of his companies he made forty million dollars in the past year, and that his investors typically get 100% of their money back within a year of handing it over.
We know he said it because two of those investors put it in a lawsuit. According to a petition filed in Harris County in February 2026, Paul Krause and a retirement account belonging to his wife sank a combined $271,257.82 into a Franklin oil venture called Oil Tycoon, LLC — and over several years got exactly one distribution back: $26,652. When they went looking for the rest of their money, the suit says, they found that video. Then they sued Franklin for fraud, breach of fiduciary duty, and violating the Texas Securities Act.
The number Franklin actually signed his name to — on a Form D filed with the U.S. Securities and Exchange Commission for his flagship Energy Flex Fund — is $21,752,000.
That’s the daylight this whole story lives in: forty million in the pitch, twenty-two million on the filing, and maybe three million a year of actual oil under all of it. So I pulled the paper.
To be clear up front: these are allegations. A court has found nothing yet, trial isn’t set until 2027, and Franklin’s side denies the claims and has its own defenses, which I’ll lay out fairly. Nobody has been convicted of anything. I’m not here to call it a fraud — I’m here to show you the documents and let you do the math. Although if any securities regulators happen to be reading: consider the rest of this an application.
The pitch
The model has a throughline. Today, Franklin’s flagship vehicle is the Energy Flex Fund, run out of Rise Capital Group. The sell is slick and, honestly, kind of clever. You’re an accredited investor. You want into oil and gas for the cash flow and the fat first-year tax deductions, but you don’t know how to vet a deal or an operator. So Rise does it for you: they find “undervalued or problematic” wells, buy them, fix them, and let you co-invest alongside the pros. You pick your projects in an online portal. You get flexible withdrawals. You get to deduct, they say, 70 to 90% of your investment in year one against your W-2 income. And you target 1% to 2% a month.
Not per year. Per month. That’s 12 to 24% annualized, paid out of wells that — by the founder’s own telling — were old and underperforming until he woke them up. It’s marketed under Regulation D, Rule 506(c) — the flavor that lets you advertise to the public, as long as every investor is accredited.
The Krause lawsuit is about an earlier vehicle, Oil Tycoon, that investors went into back in 2021. Same promoter, same playbook: 100% returns, a tour bus out to the well sites, Franklin bragging about how he was “killing it.” Hold onto that, because the question any current Energy Flex investor should be asking is whether they’re watching the sequel to a movie that already has an ending.
What he told the SEC
When you raise money under 506(c), you have to tell the SEC. It’s a one-page-ish public disclosure called a Form D.
Rise’s Energy Flex Fund 1, LP filed one. The most recent version, an amendment dated June 10, 2025, reports the fund had sold $21,752,000 to 180 investors, out of a $100 million target. It’s signed by Brent Franklin. The original December 2023 filing reported zero sold — normal for day one.
So the only number Franklin has sworn to the federal government, for his flagship fund, is about $21.75 million. Set that next to the forty-million-dollar figure the lawsuit says he used on Facebook and you’ve got two very different stories. “Made $40 million” is doing a lot of work in that sentence, too — raised, revenue, or profit are wildly different claims, and any of the three is hard to square with what comes next.
One smaller thing that isn’t small. The marketing leans hard on “zero management fees.” The Form D discloses a 1.80% annual management fee on assets under management. Read the fine print and the website’s “zero fees” turns out to mean zero on unallocated capital. But “zero management fees” in big letters next to a 1.8% fee in the federal filing is the kind of gap that tells you to read everything twice.
The lawsuit
Here’s what the Krause petition lays out, and I’ll keep saying “alleges,” because that’s what it is.
The Krauses each put in $100,000 in 2021 for a 9.52% stake in Oil Tycoon. The money, the suit says, didn’t even land in an Oil Tycoon account — it went into accounts owned by Rise Petroleum, because Oil Tycoon supposedly hadn’t opened one yet. In July 2022, Franklin made a capital call, and each plaintiff wired another $35,628.91. Total in: $271,257.82. Total back: one $26,652 distribution.
For a while, the suit says, Franklin shared “limited financials” in a group WhatsApp chat. Those chats, the petition alleges, have since been deleted and can’t be recovered. Updates dwindled. Franklin stopped responding. And the entity itself, Oil Tycoon, LLC, forfeited its existence with the State of Texas on February 23, 2024 — a matter of public record. When the Krauses’ lawyer sent a demand for the books and records in October 2025, the suit says, nothing came back.
The causes of action are not small: breach of fiduciary duty against Franklin, fraud and fraud in the inducement, knowing participation in breach of fiduciary duty against Rise Petroleum, an application for a full accounting, and violations of the Texas Securities Act — including the provisions that make a person who controls or “materially aids” a seller personally liable. The plaintiffs want their money back, rescission, and exemplary damages, and they invoke the Texas statutes on misapplication of fiduciary property and securing a document by deception.
Now the other side, because it matters.
Rise Petroleum has answered, and it denies the allegations. Its defenses, in its own words: the private placement memorandum the Krauses received ran five single-spaced pages of risk disclosures — including that the offering was not registered, that oil and gas is highly speculative, and, in capital letters, that the interests could be a total loss and that no withdrawals may be made. The defense says the Krauses signed a subscription agreement representing they were accredited investors who could bear that risk, and even agreed to indemnify the company if those representations turned out to be false. And it argues the Krauses failed to mitigate: that Franklin texted Paul Krause more than once offering to help him get out — including, in October 2024, a potential buyer at $50,000 — and that Krause declined, countering that he’d “probably consider $100k.”
Read that exchange twice. A buyer was allegedly willing to pay $50,000 for a position the Krauses had put more than $135,000 into. The defense offers it as proof the investors wouldn’t cut their losses. You can also read it as a number — what the market apparently thought the stake was actually worth.
The case is in the 129th District Court in Harris County, before Judge Michael Gomez, set for trial in May 2027. Nothing’s been decided. But the filing is real, the dollar figures are specific, and the man at the center is the same one pitching the public 1–2% a month right now.
What the wells actually pump
Here’s the part that turns the lawsuit from he-said-they-said into an arithmetic problem.
In Texas, oil and gas production is public, well by well, reported to the Railroad Commission — which, in classic Texas fashion, regulates oil and gas and not railroads. Rise’s operating entity, Texas Operating Partners LLC, is operator number 103508. Pull its production and you find roughly 32 producing wells — mostly old conventional wells, many shut in, a lot barely trickling. Add up a recent month and it’s on the order of 80 barrels of oil a day, plus a little gas.
Let me do that out loud, because it’s the whole ballgame. Eighty barrels a day at a generous hundred dollars a barrel is about $8,000 a day — call it roughly $2.9 million a year in gross revenue. And that’s gross, before lifting costs, royalties, severance taxes, water disposal, and the light bill.
Now stack the numbers. A claim, per the lawsuit, of $40 million made across the companies in a year. A flagship fund that told the SEC it raised $21.75 million. A promise of 1–2% a month, which on that raise alone implies $2.6 to $5.2 million a year owed to investors. And visible production grossing maybe $2.9 million a year — and that’s at a generous oil price, before a dollar of those costs comes out.
The promised returns rival or outrun the entire gross revenue of the wells I can see, and the net the fund actually keeps is a fraction of that. So where does the rest come from? Maybe non-operated interests that don’t show under 103508. Maybe asset flips or equipment rentals. Maybe a lot of the “return” is just your own capital handed back to you. Maybe much of the money hasn’t been deployed. Any of those could be true. But notice that none of them is “the oil is paying for it.” And an operation that pays you out of something other than what it’s selling is — I’m describing a shape, not making a finding — the shape regulators chase.
It’s not just the investors
The Krauses aren’t the only ones who say they didn’t get paid. There are two more judgments, both from oilfield contractors.
A completion company, Stealth Completion Services, sued Rise Petroleum entities in Ector County in 2021 in the over-$250,000 tier. The defendants never answered. Stealth took a default judgment in December 2021 and recorded the liens.
And a well-servicing outfit, Workover Solutions, did a six-day job that Franklin, as Rise’s president, had signed the contract for. Rise didn’t pay the roughly $45,000 bill, so Workover sued. Rise fought it — Franklin filed a sworn denial — but when it came time for his deposition, he didn’t show. The court barred him from testifying, Rise put on no witnesses, and the jury returned $45,183.82 in damages plus $142,000 in fees. An appeals court affirmed it in December 2024. Contract fights, not fraud findings — but the through-line is hard to miss: a documented habit of not paying, and a founder with a documented habit, under oath, of not showing up.
The pattern
Once you’ve seen it, you see it everywhere.
The current fund advertises “flexible withdrawals” — while the defense in the Krause case quotes an earlier Franklin offering memorandum warning, in capital letters, that no withdrawals may be made at all. The press releases call Rise “one of the fastest-growing private energy portfolios in the U.S.” and float, on unnamed sources, that family offices are circling. One 2026 release describes a South Texas well as a “barn burner” whose meter “pegged” at over 13,000 units of gas — which is a reading off a gas detector while drilling, not a production rate. It’s the oilfield equivalent of revving the engine in the driveway and calling it your top speed.
And there’s the paperwork that isn’t there. Rise markets several other vehicles to the public — an equipment fund advertising 22 to 26% returns, a “Safeguard” fund, a Bitcoin-mining sleeve. Those are exactly the kind of publicly-solicited 506(c) offerings that owe the SEC a Form D within 15 days of the first sale. I went looking and couldn’t find them. Not proof of a violation — a fund can file under a slightly different legal name — but it’s a question worth asking out loud.
So what is this?
I don’t know, and I’d distrust anyone who told you they did from the outside.
What I can tell you is what the record shows: a now-filed lawsuit from investors who say they put in $271,000 and got $26,000 back; a forty-million-dollar, 100%-returns claim that those investors say drove them to sue; a forfeited LLC; deleted financials, per the suit; money that allegedly flowed into a sister company’s accounts; two more judgments for stiffing contractors; a founder who skipped his own deposition; a flagship fund that grosses maybe $3 million a year of oil — at a generous price, before costs — against promises that require far more; and sibling funds soliciting the public with no Form D I could find.
Every one of those, alone, has an innocent explanation, and the defendants deny the lawsuit’s core. It’s the stack that bothers me. When you have to assume the best about this many things at once, you’ve stopped doing diligence and started doing faith.
If you’ve been pitched the Energy Flex Fund, you don’t have to take anyone’s word. The paper is free and public:
The Krause lawsuit: Harris County District Clerk, Cause No. 2026-09126 (129th District Court). Read the petition and the answer and judge both sides yourself.
SEC EDGAR: the Energy Flex Fund Form D. See what’s filed, and what number is on it.
Texas Railroad Commission: operator 103508. See what the wells actually produce.
The Texas Secretary of State and Comptroller: check entity status and forfeitures.
If something smells wrong, the Texas State Securities Board and the SEC take tips — and they, not a Substack, are the ones who get to use the word “fraud.”
Strip away the tour bus and the barn-burner headlines and here’s what’s left: a forty-million-dollar story sitting on a twenty-two-million-dollar filing, a few million a year of oil, and a courthouse file that keeps growing. Maybe there’s an explanation in a data room I’ll never see. But the filings are public. The judgments are public. The lawsuit is public.
Do the math before you wire the money. And regulators — the application’s right up top.
Sources / how to verify
Krause investor suit: Paul Krause and Provident Trust Group, LLC FBO Antoinette Krause SEP v. Oil Tycoon, LLC, Rise Petroleum Investments, LLC, and Brent Franklin, Cause No. 2026-09126, 129th Judicial District Court, Harris County (Original Petition filed Feb. 10, 2026; Rise Petroleum’s Original Answer filed Mar. 30, 2026; trial set May 17, 2027, Judge Michael Gomez). Petition ¶19 references and links the Facebook video; ¶¶13–20 detail the $271,257.82 invested and the $26,652 distribution; counts include Texas Securities Act §§ 33A and 33F. Answer raises a general denial plus assumption-of-risk, accredited-investor/indemnification, limitations, and failure-to-mitigate defenses. Harris County District Clerk
SEC: Energy Flex Fund 1, LP, Form D/A, EDGAR CIK 0002004006 (filed June 10, 2025: $21,752,000 sold, 180 investors, 1.80% management fee, Rule 506(c), signed Brent Franklin).
Production: Texas Railroad Commission, Operator 103508 (Texas Operating Partners LLC).
Workover Solutions, Inc. v. Rise Petroleum Investments, LLC, No. 14-23-00667-CV (Tex. App.—Houston [14th Dist.] Dec. 5, 2024) (mem. op.), affirming Harris County CCCL No. 4, Cause No. 1185084.
Stealth Completion Services LLC v. Rise Petroleum Co., LLC and Rise Petroleum Investments, LLC, Cause C-21-11-1292-CV, 244th District Court, Ector County (default judgment Dec. 17, 2021).
Entity status: Oil Tycoon, LLC forfeited Texas existence Feb. 23, 2024 (per petition; verify via Texas SOS / Comptroller).
Marketing/PR: risecapitalgroup.com; risecapital.partners; riseequipmentpartnersfund.com; NetNewsLedger (Apr. 24, 2025); “barn burner” release (May 1, 2026).
The video: Facebook (as referenced in the petition).
The deeper you go on this the further you descend into the pits of Malfeas.
I've really enjoyed reading your posts and your analysis of how potential financial fraud plays out. Keep them coming. Is this something you're just interested in? Would love to know more about your background. Thanks!