Pair raked in €5m of foreign investment through forestry 'Ponzi scheme', court is told
Two Dublin men ran a "Ponzi scheme" in which they induced dozens of people to invest more than €5m in a forestry investment scam, a court has heard.
Garret Hevey (43) and David Piele (42) were involved in Arden Forestry Management (Arden FM) between January 2014 and mid-2016 during which time 143 foreign investors were induced to deposit approximately €5.5m into the company's accounts.
Detective Inspector Catharina Gunne told Dublin Circuit Criminal Court these investments would have required around 858 acres of land to be serviced but the company only owned 30.2 acres of land when the fraud came to light.
The court heard that in company documentation sent to investors, Hevey used the pseudonym James Baker and Piele went by the name David Marshall.
Hevey was in charge and Piele second in command and there were a number of others employed in trying to attract investors.
Accounts linked to the firm showed that, of €501,332 transferred to Hevey, €281,613 was spent on Google Ads.
Gardaí began investigating the company in June 2016 when one investor, Kari Wahlstrom, discovered Arden were not the registered owner of the land he had invested in.
Mr Wahlstrom, a Finnish national, had invested €52,000 in February 2016 and in May contacted the company and asked to visit what had been identified as his investment. He also asked to be taken to the land registry.
On May 17, 2016, Piele emailed Hevey saying "s***, he wants to visit the land registry, how do we get over that?"
Det Insp Gunne told the court the victim did visit Ireland and met Hevey and Piele.
He was taken to a forest in Frenchpark, Co Roscommon, and was happy with it but when he asked to go to the land registry office he was told there was no time.
On returning to his home in Greece he carried out his own inquiries with the land registry and was "dismayed" to find the land registered to someone else, Det Insp Gunne said.
Hevey, who set up the company in November 2013, pleaded guilty to dishonestly inducing investment in Arden FM between January 1, 2014, and June 13, 2016.
Hevey, of Brookdene, Shankill, Dublin, also pleaded guilty to three charges of inducing individuals by deception to make payments on dates between September 2015 and May 2016.
The court heard Piele, of Avondale Court, Ballyguile, Wicklow, joined the company in 2015. He pleaded guilty to dishonestly inducing investment in Arden FM between January 1, 2014, and June 13, 2016, and guilty to two charges of inducing individuals by deception to make payments on dates between September 2015 and May 2016.
Det Insp Gunne told Dominic McGinn SC, prosecuting. said investors received a welcome pack which promised returns on their investment on the basis of income received from government grants, thinning of the forest and potential future sale of the forest.
Det Insp Gunne said there was in fact only 32 acres of forest, purchased for €61,000, and the company was not eligible to a grant as the trees were more than 20 years old. The grant was only available for forests planted in the last 20 years.
Det Insp Gunne said investors received a total of €271,000 in payouts and when the company account was frozen by gardaí as part of their investigation, a total of €1.98m remained in the bank account
She said €1.5m was transferred from Arden to a bank account in Dubai of which both defendants were beneficiaries.
Judge Melanie Greally adjourned the case to later today for mention, when she will set a date to hear a plea in mitigation on behalf of Hevey and Piele. She remanded both men on bail.