Quest Resource Corporation (NASDAQ: QRCP), Quest Energy Partners, L.P. (NASDAQ: QELP), and Quest Midstream Partners, L.P., developers of natural gas and oil properties, recently announced the termination of the companies’ chief financial officer and the status of their internal investigation into certain questionable transfers of funds to an entity controlled by the former chairman and chief executive officer of the companies.
On September 13, 2008, the boards of Quest Resource and the general partners of Quest Energy Partners and Quest Midstream Partners terminated Mr. David Grose as the chief financial officer of the companies, effective immediately. On August 25, 2008, the companies announced the resignation of Mr. Jerry Cash as chairman and chief executive officer after the two companies were notified by the Oklahoma Department of Securities regarding questionable transfers.
The internal investigation is currently underway and the special committee has cautioned that significant additional work remains to be done to confirm the full extent of inappropriate uses of the companies’ assets and their effects on the companies. Based on the findings obtained in the investigation to date, the special committee believes that the questionable transfers to the cash-controlled entity involved a total of approximately $10 million. At this time, the companies cannot accurately predict when the investigation will be complete.
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