The High Court has found that Garret Hevey and David Peile were knowingly parties to the fraudulent business of Arden Forestry Management Limited, which raised more than €6.4 million from investors for forestry interests that were largely not acquired.
In a judgment delivered on 15 February 2024, Mr Justice Brian O’Moore declared both men liable under section 610(1)(b) of the Companies Act 2014. He ordered Hevey to be personally liable for €3,807,142 in company debts and liabilities. The court did not set Peile’s liability amount: it is to be determined at a further hearing.
The liquidator’s evidence was that 166 investors paid the company €6,432,745, believing they were acquiring interests in Irish forestry. The company acquired 30.2 acres at a cost of €133,925. Investors received €392,641 in payments, which the judgment said came from funds supplied by other investors. The company’s outstanding debts at the hearing were €3,807,142.
Hevey did not contest the application and filed no evidence. The judge found that he devised and led the fraud, including dishonest promotional claims, false timber certificates and the diversion of investor funds. His guilty plea to fraudulent trading was also admitted as evidence.
Peile, who was not a director of the forestry company, contested the application. He said his work was mainly in sales and that Hevey orchestrated the fraud. The judge accepted that Hevey was the architect and that Peile’s involvement was materially less extensive. But the judge found that Peile knowingly participated in the continuing deception of an investor, Kari Wahlstrom, and helped establish Arden FM, a company he solely owned and directed. The judgment said Arden FM was used to receive investor money after a court freezing order and that Peile received £301,300 from its account without providing a good explanation.
The judge also relied on Peile’s guilty plea to fraudulent trading, while considering his account of why he pleaded guilty. He made no adverse finding against Peile on other disputed issues where the liquidator had not cross-examined him.
For Peile, the court identified £509,434 in losses associated with Arden FM, including transfers to Peile, payments to an entity connected to Hevey and costs of the fraud. The judge said Peile should be liable for that amount, but sought further submissions on Wahlstrom’s net loss from his €52,000 investment before finalising Peile’s share of the company’s debts. The judgment therefore leaves that part of the order unresolved.