Eco Business Management: Another carbon credit boiler room scam bites the dust

Eco Business Management, a company that sold carbon credits to the public as investments, has been closed down in the High Court in London for misleading potential investors. REDD-Monitor wrote about Eco Business Management in October 2014.

In ordering the company into liquidation, on 4 March 2015 in the High Court, Registrar Clive Hugh Jones said,

The evidence shows that carbon credits were sold to the public as investments via unsolicited telephone calls and sales agents using high pressure sales tactics.

Eco Business Management’s sales team told investors they would receive returns of up to 82% within six months to two years and that Eco Business Management had companies ready to buy investors’ carbon credits. None of this was true.

The company filed dormant accounts, although the investigation by the Insolvency Service uncovered 22 people bought carbon credits for more than £100,000 from Eco Business Management. The money was transferred to a Swiss bank account.

Registrar Jones added,

It is plain that the company treated members of the public as investors and that its business is objectionable because sales of carbon credits were presented to them as an investment opportunity and on the basis that they would increase in value substantially and quickly. The evidence shows that investors will not see any increase in the value of their credits to the extent necessary for them to realise a profit. The evidence shows they are a wasting asset not an investment and that false promises were made of substantial gains when in fact the credits are a devaluing asset and no ready market exists in which to dispose of them.

Various other companies were involved, including Eco Asian Consulting, SJL Risk and Abacus Advisory. You can read more about these companies and others, including Montague Pitman, Carbon Neutral Investments, MH Carbon and Eco-Synergies, here.

As Andrew Penman points out in The Mirror, the Insolvency Service’s investigation provides “an intriguing glimpse into the mind of the sort of person who sets up an investment scam.”

The company was registered in December 2003 under the name HB35 Limited. In October 2011, Aaron Whiteman contacted Hammond Bale LLP solicitors. Whiteman was an associate of Ulrik Debo, a client of Hammond Bale, and was looking to buy a company in order to trade carbon credits.

Sean Maddon filled in the forms and became the company director. The company’s name was changed to Eco Business Management Limited. Maddon did not respond to the Insolvency Service’s attempts to contact him.

Whiteman did.

Whiteman told the Insolvency Service that the company did not trade, and he “handed it over” for free to a broker business. He couldn’t remember the name of the broker business or any contact details of the people involved, except for someone called Chris, whose surname he’d forgotten.

Chris Mayhew, Company Investigations Supervisor at the Insolvency Service, said,

“When asked what he thought would happen as a result he said that he ‘did not give a s***’ as he was doing other things.”

It may be worth taking a look at some of the other things that Whiteman has been doing, that make him so forgetful. Until 2013, he worked for a company called Debondo Capital.

Ulrik Debo told the Insolvency Service that his company Debondo Capital, was “an umbrella organisation for a group of individuals allowing them to share contacts”.

On his LinkedIn page, Aaron Whiteman describes his job at Debondo Capital as “Vice President – Corporate Finance”. It sounds like little more than an umbrella organisation to share contacts:

When the Insolvency Service asked him why he didn’t become a director of Eco Business Management, Whiteman said that he’d been made bankrupt in 2006 or 2007 in Sweden. That he was made bankrupt may or may not be true, but Whiteman has been director of several UK companies since 2007, including one called The Carbon Credit Gruppe Ltd, which was registered in February 2012 (and is now dissolved).

In May 2012, he spend a few days in Dubai, and tweeted about the trip:

On his issuu page, Whiteman posted a brochure produced by a company called Steinmann York. The company’s products included carbon offsets, renewable energy, sustainable agriculture, sustainable forestry, gold, and diamonds. The company wasn’t registered by the Financial Conduct Authority.

On the discussion forum “WhoCallsMe” a couple of people who handed over money to Steinmann York describe their experience with the company:

“Has anybody heard of a company called Steinmann york based in London. I invested some money with them in carbon credits in 2012 . They promised me a good return on my investment but to date i have heard nothing from them. I have tried calling them on numerous occasions but keep getting the run around. i am beginning to think it was a scam ???”

“I to invested with them I just receive a latter from them saying they been forced into liquidation owing to the adverse conditions withinthe European catbon markets.have u try to sale them yet. if so can u let me no”

I can’t find anything to link Whiteman with Steinmann York, other than that he posted the company’s brochure, but the modus operandi certainly sounds similar to that of Eco Business Management. In its press release about closing down Eco Business Management, the Insolvency Service explains that,

“Investors seeking news of their investment were falsely told that the company had entered into liquidation.”

While it’s obviously good news that the Insolvency Service has shut down another scam company, the question asked by Money Observer is “will it make a difference?”

The money has disappeared into overseas bank accounts and the people behind the scam can lay low for a while before moving on to the next scam.