A web of 13 companies involved in a scheme to sell carbon credits to the public for investment that raised over £19 million have been wound up in the High Court on grounds of public interest, following an investigation by the Insolvency Service.
At the web’s centre was Eco-Synergies Ltd, a wholesaler of Voluntary Emission Reduction (“VER”) carbon credits, which it supplied to other, often related companies to market to the public for investment. Such investments were sold to the public using false claims contained in slick brochures, among other methods.
The other companies shut down included:
Chris Mayhew, Company Investigations Supervisor at the Insolvency Service, said, “Eco-Synergies Ltd was at the centre of and controlled this web of companies in this patently bad scheme to sell carbon credits to the public for investment. The use of associates was central to its “pioneering” business model. The credits were sold at such inflated prices that an unnatural increase in value would be required before investors could break even let alone see a return on their investment. Essentially investors including vulnerable individuals and often repeat victims who were urged to buy more and more credits have lost their money.
The investigation uncovered that carbon credits sourced by Eco-Synergies Ltd for an average of 65p per credit were then sold to investors by the web of ostensibly unrelated companies at an overall mark up of up to 869%. The investigation revealed that investors had paid some £19 million for carbon credits shown to have cost Eco-Synergies Ltd some £2.3 million.
Eco-Synergies Ltd described itself as a carbon market pioneer and claimed to be “The voluntary carbon specialists”. This company provided bespoke assistance to the outer web companies thereby enabling those companies to sell carbon credits to the public for investment. Eco-Synergies Ltd benefitted from the sales made to the public by such companies as it supplied the credits to them at a mark up stressing to them that they themselves could expect returns in excess of 60%, telling them “You simply complete a trade and we will do the rest”.
A presentation brochure to the web companies recovered by the investigation describes Eco-Synergies Ltd as, amongst other things:
● the largest wholesale supplier of carbon credits in the market with 25+ active trading agents,
● that it settled between 1-2 million credits a month,
● had a monthly turnover of £5m+
● had spent £200,000 on legal fees to ensure its system and contracts were “watertight”.
The brochure’s “Case Study” focused on one associated company MH Carbon Limited, which Eco-Synergies Ltd exclusively supplied and worked with directly to sell out credits for them. The company described MH Carbon Limited as, amongst other things:
● one of the market leaders and the largest in terms of revenue floor of this type in London,
● that it settled between 400,000-500,000 credits a month and
● had average monthly sales of £2 million.
Mr Gavin Manerowski, an initial shareholder of Eco-Synergies Ltd, was a director of MH Carbon Limited which, together with the other marketing companies, made false and misleading statements to the public to persuade them to invest in carbon credits. Mr Manerowski, together with Mr Richard Beese, Mr David White and Mr Jonathan Cocks also established a non trading company Eco-Synergies Nominees Ltd to hold the credits purchased by the public on trust for investors.
Eco-Synergies Nominees Ltd did not oppose the winding up action and afterwards the professional director and secretary of the company served notice of their intention to resign their appointments.