HISTORY
History
Prior to 1943 there was much speculation in the sale and leasing of mineral, oil and gas lands, particularly
during the Depression period from 1933 to 1939. While it may seem strange that people invested in such highly
speculative ventures during that period, it is explained that they were desperation investments. Many persons
gambled their last resources in hope of gaining huge profits.
During the period mentioned, it was estimated that approximately 1,000 oil and gas salespersons were actively
engaged in every section of the state. They confined their sales to parcels in newly created oil and gas
subdivisions for the most part. While most oil and gas subdivisions were located in California, lands and leases
in Texas, Oklahoma, Illinois, New Mexico, Wyoming, Montana and various other states were offered. While
these lands were believed to have some potential for oil and gas production, the possibilities were rather
remote. In most cases, purchasers of interests lost the entire amount invested.
A statewide drive was undertaken in 1943 to end these activities. This was accomplished by the Department of
Real Estate (the Department) with the assistance of district attorneys, the Attorney General, Department of
Corporations and local police departments. Many promoters were convicted of grand theft and about 600
operators lost their real estate licenses as a result of formal hearings or failures to renew such license because of
the circumstances. The 1943 efforts resulted in legislation.