Three directors jailed for £70m tree-planting investment scam

Matthew Pickard, 55, Stephen Greenaway, 48, and Paul Laver, 48, have been jailed after convincing close to 3,000 people to invest their savings and pensions into Ethical Forestry Ltd (EFL). The company promised investors substantial returns from a tree-planting scheme in Costa Rica.

Between 2008 and 2015, the directors withdrew £14 million from the company through a tax avoidance scheme. This money was spent on properties, luxury holidays in destinations including Gran Canaria, the Maldives, Italy, and Thailand, and a number of high-value cars. The court heard that the company collapsed in 2015 due to missing funds and a significant unpaid tax bill, leaving investors to lose their money.

Sentencing and Judicial Remarks

On Thursday, 3 September, Judge Alexander Milne KC sentenced Pickard to six years in prison, Greenaway to five years and three months, and Laver to four and a half years. The judge stated that the three men had treated investors' funds as disposable income rather than working capital. He described their actions as 'plunder, plain and simple,' and noted that they had turned the company into their personal bank account, with no intention of repayment.

Judge Milne KC also commented on the extensive damage caused to victims, stating that their futures were blighted, marriages broken, and their health and security jeopardised. The court heard that it was a common practice for EFL staff to move the supercars parked at the office whenever an investor was scheduled to visit.

Victims' Losses and Director's Spending

Investors were cold-called by EFL and enticed with glossy brochures depicting trees in Costa Rica. The minimum investment required was £10,000, with one victim investing £200,000. Prosecutor Kevin Dent KC told the court that the directors had financially decimated EFL, diverting £14 million to run the tax avoidance scheme, which resulted in an additional £14 million tax liability for the company.

While approximately two million trees were planted in Costa Rica, the directors failed to invest in their long-term maintenance. The court heard that Pickard took £8.2 million, Greenaway received £3.1 million, and Laver took £2.5 million. Pickard purchased a £4.2 million property and spent nearly £4 million on renovations, including a swimming pool. He also bought a yacht for £283,000 and a Maserati for £101,000.

Greenaway acquired a £1.9 million home and spent £1.3 million on 26 cars, including three Ferraris and a McLaren. Laver purchased a home in Dorset, 16 cars valued at £673,000, and spent £29,709 on a home cinema. The court was informed that the directors had purchased a vanilla and spice plantation in Costa Rica in 2011, with Pickard telling his mother in an email that it was 'buying for us rather than the investors'.

Victims described financial ruin, ill health, and broken marriages. Kevin Davies, who invested £110,000 in 2012, stated that he would likely have to sell his home of 18 years as he could no longer work due to ill health. He said the experience had robbed him of financial stability, health, peace of mind, and his future.

Company Collapse and Aftermath

EFL made some payments to investors, falsely claiming they were 'harvest returns' from the Costa Rican trees, when in reality, the funds were taken from other investors. This practice was used to 'paper over' the company's financial state and lure more people into investing. The company continued to accept investments as it neared collapse in 2015.

Following an investigation by the Serious Fraud Office (SFO), all three directors pleaded guilty to fraudulent trading. SFO director Graham McNulty stated that the directors preyed on people's good intentions to support a 'green' investment, stealing £70 million from hard-earned life savings and pensions. He added that the thorough investigation exposed the fraudulent scheme and secured guilty pleas.

All three defendants have been disqualified from acting as company directors for 10 years. Proceeds of crime hearings are scheduled to attempt to recover the victims' money.