WAYZATA, Minn.-A former oil company executive from Minnesota has been ordered to repay $6.5 million in "ill-gotten gains," plus a fine and accrued interest, in the wake of a stock manipulation scheme involving a North Dakota oil loading facility for which he and business associates reaped an estimated $32 million.

An Oct. 31 order from the federal Securities and Exchange Commission puts Michael L. Reger on the hook for nearly $8 million for his involvement with Dakota Plains Holdings, a Minnesota company that owns the oil terminal in New Town in northwest North Dakota.

Reger must repay the government a $6.5 million "disgorgement," a term for funds that were received through illegal or unethical business transactions. He was also ordered to pay $669,365 in interest, plus a $750,000 fine.

In a separate action, the SEC charged Reger's former business partner, Ryan Gilbertson, in the stock manipulation scheme, for allegedly orchestrating an elaborate scheme to siphon millions of dollars from Dakota Plains Holdings Inc. Two others have also been charged in the stock manipulation case.

For Reger, 40, the SEC's action represents a staggering blow to a once promising career. His family has been involved in the oil and gas business since the 1930s. In 2012 and 2013, Forbes named Reger one of "America's Most Powerful CEOs 40 and Under." He received widespread recognition for the company's success as Bakken oil production soared.

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Last August Reger was terminated as chief executive from Northern Oil and Gas Inc., a Wayzata, Minn., company which he co-founded in 2006. His firing came soon after Reger told company officials that he had received notice from the SEC that he was the target of an investigation for securities violations.

Reger filed a wrongful termination lawsuit against Northern Oil and Gas soon after his firing.

The SEC said its proceedings arise from Reger's undisclosed ownership and control of Dakota Plains, a publicly traded company founded in 2008 by Reger and Gilbertson.

To avoid disclosing the full extent of their control of Dakota Plains, Reger and Gilbertson first named their fathers as figurehead directors and officers and later installed one of their friends as CEO. But despite not having any official roles in Dakota Plains, Reger and Gilbertson controlled the company behind the scenes, and they used their influence to obtain significant financial benefits for themselves, the SEC said.

As part of its investigation, the SEC found that Reger owned 21.4 percent of the stock in Dakota Plains at the time it first went public. But he divided his holdings among 10 accounts in different names to avoid public disclosure requirements under federal securities law.

When Dakota Plains was founded, Reger and Gilbertson received millions of founder shares in the company. Additional shares were issued to friends and family members.

"Reger made only a nominal capital investment in Dakota Plains, but he lent the company $120,000 in 2008 and 2009 as partial funding for the acquisition of land in North Dakota for a rail facility. To avoid disclosing the full extent of their involvement in Dakota Plains, Reger and Gilbertson named their fathers as CEO and president, respectively. The fathers, however, were mere figureheads, and Reger and Gilbertson made all material decisions," the SEC said.

The commission said it has agreed to an offer of settlement from Reger, who cooperated with investigators. The agreement includes a provision in which Reger neither admits nor denies the findings of the investigation, except to acknowledge the commission's jurisdiction in this case.

"I am relieved to put this matter behind me. This settlement allows me to continue my career in any direction as I am fully able to serve as an officer or board member of a publicly traded company," Reger said in a statement released by his attorney, Jon Austin.

"This agreement also shows that Northern Oil, the company I founded and built, was wrong to characterize my termination as being with cause. I'm confident I will prevail in my lawsuit against Northern and I look forward to having the unfounded attacks on my reputation put to an end once and for all," he said.

The SEC's order details a series of loans, payments, consulting fees and stock placements that benefited Reger, Gilbertson and others. From March of 2009 until December of 2011, the company issued four private placements of its stock, raising more than $7 million. Among other things, the proceeds were used to repay the initial loans that Reger made to Dakota Plains, plus 12 percent interest.

"None of the offering materials for any of the private placements disclosed any involvement of Reger in the management or control of Dakota Plains or identified him as having loaned any money to the company," the SEC said.

Dakota Plains became a publicly traded company in March 2012.

According to the SEC, Gilbertson enlisted friends and associates, including Douglas Hoskins and Thomas Howells, to choreograph extensive sales and purchase of Dakota Plains stock. The stock price skyrocketed from 30 cents per share to more than $11 per share during a 20-day period. The inflated stock price obligated Dakota Plains to make bonus payments totaling $32 million to Gilbertson, Reger and others.

But the stock price for Dakota Plains Holdings has been on a steady decline since then. On Wednesday, the company's stock was selling for pennies per share.

On Nov. 7, Northern Oil and Gas Inc. reported third-quarter net earnings of $2.4 million, or 4 cents per share.

SEC investigators concluded that Reger acted negligently in failing to disclose his ownership and control of Dakota Plains. Federal securities law prohibits a person to offer securities while attempting to mislead or commit fraud on the purchaser.

Meanwhile, investors of Northern Oil and Gas Inc. have filed a class-action lawsuit, naming the company, Reger and interim CEO Thomas Stoelk as defendants. The lawsuit, filed in U.S. District Court in New York, accuses Reger and other company officials of unethical and illegal activities while managing the energy company. The lawsuit seeks unspecified damages, in addition to costs and attorney's fees.