CHARLESTON, W.Va.—- A Charleston woman pleaded guilty Thursday to aiding and abetting the sale and offer of unregistered securities.
According to court documents and statements made in court, Deanna L. Drumm, 60, became vice president of operations for Bear Industries LLC, a West Virginia company solely owned and operated by her son Theodore Miller, in or around 2019 or 2020.
Bear Industries was originally serving as an umbrella company for other related businesses including a real estate company, a real estate holding company and a construction company. Drumm’s job as vice president of operations was responsible for most of the day-to-day operational tasks for the companies’ entities while her son was living outside the United States.
Between February 2022 and August 2024, Drumm admitted that she aided and abetted the sale and offering of securities in the form of investments in two real estate-related ventures. One of the ventures offered direct investments in the purported development of a dry-storage lot and residential duplexes on Bigley Avenue in Charleston. The other one offered investments in Bear Lute a pooled real estate investment vehicle by Drumm’s son in May 2022. The second offer helped Bear Industries obtain more than $335,000 for more than 170 individuals between May 2022 and September 2024.
Both of the direct investments, as defined by federal law, offered through interstate commerce via the internet and were required to be registered. Drumm admitted that there was no registration statement in effect for either of these securities. She admitted that she was able to aid and abet the offerings by processing payments by investors, assisting with the creation of the investment prospectuses and maintaining investor lists. She further admitted to knowing of numerous false and misleading representations made in relation to both securities. Her son never possessed legal title for any of the Bigley Avenue properties. Bear Lute investors were falsely told that Bear Industries was a large and successful real estate company.
The West Virginia Securities Commission, in September 2023, issued a cease-and-desist letter to the company ordering it to stop the unregistered sale and offerings and issued it again in November 2023.
Drumm’s son was arrested in August for the alleged conduct related to the direct investments. Drumm admitted to driving evidence material to her son’s prosecution from West Virginia to her parent’s home in Michigan. The evidence included his laptop, and a backpack belonging to him
Drumm’s sentencing is scheduled for March 13, 2025. She faces a maximum penalty of five years in prison, up to three years of supervised release and a $250,000 fine. She also owes as much as $434,501.42 in restitution.
And on September 4, a federal grand jury returned a 15-count indictment charging 34-year-old Miller with wire fraud, money laundering and obstruction. In the indictment it alleges that Miller induced the direct investments for the real estate projects and the investments in Bear Lute.
The U.S. Securities and Exchange Commission has also filed a parallel civil action against Miller, Bear Industries LLC, Bear Investments and Business Consulting LLC, and Drumm.