Forestry for Life was a forest carbon trading company set up in 2009 with the aim of raising US$5 billion by 2013. The plan failed dramatically, and this year the company’s founder and director, Matthew Ames, appeared at the Old Bailey, charged with fraud.
In March 2011, two of Ames’ companies, the Investor Club and Forestry for Life, went into liquidation, owing investors £1.2 million. That figure could have been way higher. The company had offices in the UK, Dubai and Hong Kong, according to its website.
Before it all went pear-shaped, Matthew Ames managed to recruit several high profile people to Forestry for Life. In October 2010 James Middleton, the brother of Kate Middleton (now the Duchess of Cambridge), was photographed representing Forestry for Life at a carbon trading exhibition in London. Forestry for Life’s solicitors Carter-Ruck told the Daily Mail that Middleton was not formally employed by Forestry for Life and “only became involved in the company in June this year [2010], and works on a part-time basis assisting in the development of the company.”
Middleton complained to the Press Complaints Commission, and the story was buried. In April 2011, Middleton told The Telegraph that,
“I undertook a small amount of work experience with the company last year and I have no ongoing connection with the company.”
A Forestry for Life company brochure (pdf file, 2.2 MB) claims that its board also included high profile people: Sir Rodney Walker, a sports administrator; Nick Barclay, head of financial advisory group Montpelier Group; Bremley Lyngdoh, an Indian social entrepreneur; and John Hudson, former senior forestry advisor at the UK’s Department for International Development (DfID). Hudson was, in fact, never on Forestry for Life’s board. Neither was Lyngdoh, nor Sir Rodney, nor Barclay.[*]
Footballer Jack Charlton also promoted the company.
Forestry for Life hoped to attract investment from institutional investors for its tree planting and avoided deforestation projects. In 2010, Ames explained that Forestry for Life would launch a US$35-50 million fund at the end of 2010. By the end of 2011 it hoped to raise US$1 billion and US$5 billion by the end of 2013. Ames hoped to get 60% of the money from Asian investors, 25% from the Middle East and 15% from the UK. The projects would be in a range of countries, 60% in South America, 20% in Africa and 20% in Asia.
The company brochure explains how the company’s business plan was supposed to work:
Forestry For Life work with international governments and landowners to protect and save the rainforests. By combining this policy with our compliance to the Voluntary Carbon Standard and the CCBA we generate carbon credits, which we then trade to companies who need to offset their emissions.
Our investment is based on Carbon Credit Trading. Dependent on level of investment, clients are able to bulk buy our credits at wholesale prices. We will then trade those on the carbon markets via our own carbon brokerage and generate the highest returns possible.
The company promised fixed returns of 12% for the first three years, supposedly based on sales of carbon credits. Nevertheless, the company brochure boasts, this would be a “low risk ethical investment opportunity”. Ames told Carbon Finance that, “Our aim is to have the premium forest carbon credits in the marketplace.” Money from “sustainable timber activities” would go to local communities.
Jon Austin, a journalist at The Echo, a UK regional newspaper, has been investigating Ames’ companies for several years. (He also investigated a company run by Matthew Ames’ father, David Ames. The company, Harlequin Property, is currently under investigation by the Serious Fraud Office, having raised somewhere between £250 and £300 million from investors for luxury homes in the Caribbean, but actually building only a handful of them.)
In August 2010, The Echo reported that Forestry for Life’s “investments” were based on carbon credits that did not exist. Neither did the company own any rainforest, despite claiming that it owned over 400,000 hectares in Sri Lanka, Brazil and Uganda.
In a radio interview in 2010, Ames said Forestry for Life was “planning” on buying one million hectares of land:
“We’re not here to save the world, we’re not here to change the whole carbon equation. What we are here to do, is to do good while earning a bit of money, realistically. If we don’t do what we plan to do in the next year, we’re planning on buying up to one million hectares, two-and-a-half million acres, of land and saving those trees and replanting trees in areas that have been cut down, and if we don’t do our job, then yes there’s going to be those trees lost and cut down.”
In July 2010, the Financial Services Authority started an investigation into Forestry for Life. In March 2011, Jon Austin reported that, “Latest accounts for the firms showed no evidence of clients’ money invested, or carbon credits traded.”
Matthew Ames was arrested in September 2011 on suspicion of fraud by false representation and fraudulent trading.
In December 2012, Matthew Ames was charged with fraud. A police spokesperson said,
“Matthew Ames has been charged with two counts of fraudulent trading. This relates to investments made in teak trees concerning The Investor Club and carbon credits for Forestry for Life.”
The Investor Club allegedly raised £846,494 for investments in teak tree plantations in Sri Lanka, while Forestry for Life allegedly raised £443,327 from investors for avoided deforestation projects in Brazil and elsewhere.
Ames appeared at the Old Bailey in February 2013 and pleaded not guilty. He will appear in court again in September 2013.
UPDATE – 25 May 2013: REDD-Monitor was also taken in by Forestry for Life’s lies in the company brochure. I’ve edited this paragraph to reflect the fact that although the Forestry for Life company brochure claims that these people were on the board, in fact, at least one of these people (John Hudson) were not on the board. I have written to Sir Rodney Walker, Nick Barclay and Bremley Lyngdoh to ask whether they were on the board.
UPDATE 2 – 25 May 2013: Bremley Lyngdoh was not on the board of Forestry for Life. “I was never on the Board of Directors of Forestry for Life and I was misrepresented on the company brochure,” he wrote in an email to REDD-Monitor today.
UPDATE 3 – 26 May 2013: Sir Rodney Walker was not on the board of Forestry for Life. “The ONLY person to every have been a registered director of Forestry for Life was Matthew Ames,” Sir Rodney wrote in an email to REDD-Monitor today.
In August 2013, the Insolvency Service disqualified Ames from being a company director for 13 years.
The trial in September 2013 was postponed until January 2014. Isleworth Crown Court heard that Ames did not invest the money. According to City of London Police £250,000 was paid to investors, but the money came from other clients’ deposits. “This is often referred to as a Ponzi scheme, taking from Peter to pay Paul out of new creditors’ money that is being shuffled around,” prosecutor Stuart Biggs said.
Ames was found guilty – sentence still to come. Here’s a short report from Court News UK, 12 February 2014:
AMES: FRAUDSTER ONCE HIRED JAMES MIDDLETON TO PROMOTE SCHEME
A ‘green finance’ firm boss who hired the brother of the Duchess of Cambridge to promote a bogus rainforest protection scheme today (weds) faces years behind bars. Matthew Ames, 38, cheated ethical investors out of £1.6m through fake green projects to fund his lavish lifestyle. His business Forestry For Life, which netted over £400,000 by claiming to protect the Amazon rainforest, was represented by Kate Middleton’s brother James at a trade fair in London in 2010. Ames also hired England World Cup winner Jack Charlton and sport supremo Sir Rodney Walker to promote Forestry for Life and his other firm, the Investor Club, at events.
Finally this spotty oik has been sent to jail. http://www.dailymail.co.uk/news/article-2586338/Conman-hired-James-Middleton-promote-bogus-rainforest-protection-scheme-used-swindle-ethical-investors-1-6m-jailed.html