Three jailed over £70m eco-Ponzi scheme that wiped out 3,000 investors' savings

Three directors of Bournemouth-based Ethical Forestry Limited have been sentenced at Southwark Crown Court for a £70m fraud targeting eco-conscious investors.

Directors of green investment firm jailed after blowing millions on Ferraris and ski holidays

Three directors of a Bournemouth-based investment company have been jailed after defrauding more than 3,000 investors out of £70 million through a scheme that promised returns from tree plantations in Costa Rica, the Daily Express reports.

Southwark Crown Court sentenced Matthew Pickard, 56, to six years in prison. Stephen Greenaway and Paul Laver, both 48, received five years and three months, and four and a half years respectively.

Judge Alexander Milne KC told the men they had "treated investors' funds as disposable income rather than working capital." He added: "This was plunder, plain and simple. Funds were spent as if you had each won the lottery."

How the scheme worked

Ethical Forestry Limited (EFL) operated between January 2008 and December 2015, cold-calling prospective investors and luring them with glossy brochures depicting tree plantations in Costa Rica. Investors were told they needed to commit a minimum of £10,000 to join the scheme, with one victim ultimately putting in £200,000.

Prosecutor Kevin Dent KC described the pitch to the court: "EFL's offer was an intoxicating blend of hard finance and ecological consciousness — invest with us, they claimed, and you can expect to make huge amounts of money and also make the world a better place."

Investors were promised returns of between 10 and 25 per cent when trees were harvested and the timber sold for profit. Most transferred existing pension funds into the scheme on the basis, Dent said, that "EFL was an honest, reliable and trustworthy company and a secure home for their savings or pensions."

Around two million trees were planted in Costa Rica, but the directors failed to invest the funds needed to maintain them long-term.

Millions diverted to personal accounts

While continuing to recruit investors, the three men were simultaneously "hollowing out" the company, the court heard. Pickard withdrew £8.2 million from EFL, Greenaway took £3.1 million, and Laver took £2.5 million. A further £2.77 million was diverted to run a tax avoidance scheme, which in turn generated an additional £14 million tax liability the company could not meet.

When EFL collapsed in 2015, no investor received any genuine return.

The spending was extensive. Pickard purchased a £4.2 million property in Poole and spent nearly £4 million on renovations, including a swimming pool and £30,000 on garden tiles. He also bought a £283,000 yacht, a £101,000 Maserati Nero Granturismo, and paid £345,000 in private school fees. A £47,000 holiday to a Swiss ski resort was among further personal expenditures recorded.

In an email to his mother written during a 2011 trip to acquire a vanilla and spice plantation in Costa Rica, Pickard noted: "Buying for us rather than the investors."

Greenaway bought a £1.9 million home in Poole and spent £1.3 million on 26 cars, including three Ferraris, five Porsches, and a £120,000 McLaren MP4-12C. He spent a further £85,000 on holidays and £58,662 on luxury watches and jewellery.

Investor Hazel Millington told investigators she had known Greenaway when he lived in a "modest flat" in Poole, before later seeing his Facebook page filled with photographs of expensive sports cars, a large house, and first-class holidays.

Laver bought a home in Dorset along with 16 cars worth £673,000 in total. His personal expenditure also included a £29,709 home cinema and a painting costing 12,500 dollars, purchased during a trip to Caesar's Palace in Las Vegas.

The court heard it was a "running joke" among EFL staff that the supercars in the office car park had to be moved whenever an investor was due to visit.

Victims left facing financial ruin

The human cost of the collapse was set out in victim testimony before the court. Judge Milne said the fraud had left "futures blighted, marriages broken, health and security of people jeopardised." Some victims were forced to rely on government support after their savings were wiped out, and others were placed in danger of losing their homes.

Kevin Davies told the court he had invested £110,000 in EFL in 2012, hoping to grow his pension while also contributing to the environment. He said he now faces having to sell his home of 18 years after being unable to continue working due to ill health.

"This experience has robbed me not only of financial stability, but of my health, my peace of mind, and the future I worked so hard to secure," Davies said. "The betrayal of trust and the consequence of this failed investment has and will continue to affect me."

One victim described Pickard directly as "evil" as the scale of the damage was detailed in court.

The judge told all three defendants: "It was abundantly clear you never intended or expected to have to make repayment of these funds."

Source: Daily Express