# Anyone know about Silva Tree investments? intially looks too good to be true: 13% p.a



## aristotle

I came across an ad for Silva Tree invesments which intially looks too good to be true (13% p.a. returns etc).

Details are here... http://www.silvatree.com/timber-investment.html

I would assume that if something seems too good to be true then there probably is a catch? Could someone with a better eye for evaluating investments give it a look over?

Thanks


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## Brendan Burgess

The disclaimer at the bottom of the page would be enough for me. 

It's not an Irish company.
It's not even a UK company.



> Silva Tree is the business name of Silva Tree Panama Sociedad  Anónima, constituted in the Republic of Panama under Card 662964  Document 1583442, in the Mercantile Section of the Public Registry of  Panama. Silva Tree is not regulated by the UK Financial Services  Authority and is not authorised to give investment or tax advice to the  public. Please read our legal disclaimer.


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## mercman

A certainty to be filed under 'S', and that is not for Silva.


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## aristotle

I saw the ad for it in Business & Finance magazine where it also has published a one page "commercial profile" of Silva Tree. 

It says the returns are gauranteed via an insurance policy (i.e. if the current buyer of the trees decides to pull out of the deal when the trees mature in 5 years time) and that all monies are handled via a London based third party so that even if Silva Tree goes bust the investment is not affected.

Having said all this, a Google search comes up with some interesting stuff.


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## SlurrySlump

Do you not remember the "guaranteed" rental income on French leaseback properties a few years back?  Where are those guarantees now?


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## Complainer

Check out who has the contract to maintain the forests? If it happens to be another business operated by the investment promoters, you know where your money is going to go.


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## Cynic

*Do your homework*

Just ask your IFA to do some due dilligence on this investment.  I also saw them in the magazine and asked my IFA to find out if it's legit.  From what I can see, they do have a UK company, they use a 3rd party for the management and they check out with everyone, including some big UK & Ireland pensions companies.  There's also a trustee involved and they check out too.  Looks good to me.


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## ajapale

Cynic said:


> Looks good to me.



Doesnt look good to me.

Vague supportive posts from first time posters should be treated with much caution.


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## canicemcavoy

Cynic said:


> Just ask your IFA to do some due dilligence on this investment. I also saw them in the magazine and asked my IFA to find out if it's legit. From what I can see, they do have a UK company, they use a 3rd party for the management and they check out with everyone, including some big UK & Ireland pensions companies. There's also a trustee involved and they check out too. Looks good to me.


 
Cynic, is there any reason you registered an account on AAM to post this?


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## Cynic

Wow.  I thought I was the cynic!  Just trying to help...


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## Complainer

Cynic said:


> Just trying to help...


Maybe you would contribute some specifics then, instead of the vague, bland platitudes?


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## och aye

there are solid forestry ( teak plantations) investment funds in panama...see www.greenbelt.ie supported/promoted by other irish brokers.
Perhaps there is a parallel or a linkage between silvatree and these


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## Cynic

My remarks were in direct response to the comments made, not vague in my opinion.  I think I had better keep my views to myself if this is the reception they receive, as I said I was just trying ot help.  Aristotle, good luck.  I invested in this product, I'll let you know how it goes.


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## Silva Tree

Removed message.


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## Brendan Burgess

Silva Tree

Data Protection legislation would prevent you from posting a list of your clients in Ireland. But it would not prevent you from posting a list of your agents or distributors. Please provide this list or a sample from it. 



> The investment has been signed off by an FSA regulated UK Trustee and  given subsequent SIPP approval by many providers there.



This could be misinterpreted by readers that the FSA has in some way "approved" your product. I presume that it has not? 

Anyone who invests in your product has no protection in Ireland. 

Please also explain who provides the "guarantee" of the return. Or is that also covered by the Data Protection Act?


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## Rory Gillen

For anyone interested in timber investments, Phaunos Timber Fund plc(ticker code: PTF-L) is a UK-listed investment company with a spread of timberland assets across the globe including good presence in emerging markets. The latest net asset value of the fund is $1.07 and the shares trade near $0.7.

You can read about the company by googling their website etc. You buy into and sell out of an investment company as you would CRH or any conventional company through your stockbroking account.


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## Brendan Burgess

We don't allow discussion of individual shares on askaboutmoney, but as this particular post shows people how to invest in a commodity through a share, we will leave the post stand. But please don't discuss the valuation of the share itself. 

Brendan


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## Rory Gillen

Brendan Burgess said:


> We don't allow discussion of individual shares on askaboutmoney, but as this particular post shows people how to invest in a commodity through a share, we will leave the post stand. But please don't discuss the valuation of the share itself.
> 
> Brendan


 
Comment above on Phaunos Timber amended somewhat Brendan to respect your rules, which make sense.


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## Silva Tree

Removed message.


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## aristotle

Silva Tree, who provides the gaurantee on the return and what terms and conditions are attached to that?


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## Silva Tree

Removed message.


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## ajapale

Hi ST,

Can you provide a link to the brochure?

Thanks,

aj


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## Silva Tree

Removed message.


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## Brendan Burgess

So let's be quite clear.

There is a guarantee but you won't discuss it in public. 

So you will call people to explain it.

This is absolute nonsense. Either explain your product publicly or stop using askaboutmoney to promote it.

Brendan


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## Brendan Burgess

Silva Tree is advertising again in today's Sunday Business Post Here is the heading:



> Want to make up to 18.71% and save the planet?
> 
> The Princess Project is an ethical timber investment with guaranteed returns*
> 
> High Return - Returns of up to 18.71% paid out every 5 years over 20 years*
> Low Risk - Managed by UK FSA regulated trustee
> Low Entry Level
> Help the Environment.



If this was a regulated investment I would certainly complain the ad to the the Financial Regulator.

I cannot read the small print to which the asterisk refers.  
I have no idea how the "guarantee" is provided. I would be very surprised if any solid guarantor was guaranteeing a return of 18.71%
"Managed by UK FSA regulated trustee"  could mislead people into thinking that this fund is regulated by the FSA - which I presume it is not. 

I presume that there is no point in complaining to the ASAI? 

Is there any point in bringing it to the attention of the Sunday Business Post?


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## langbarb

hi i have been looking for investments in forestry and came across Silva  tree. If i understood correctly the 18.71% is a "simple" return, not  compounded. So at the end of the 20 years an investment of USD 7.5k will  give you USD 33,196.82 as per their brochure, which on a compounded  basis is 33,196.82/7500^(1/20) - 1 = 7.7%pa. For a 20y investment a 7.7%  return pa is ok, but not spectacular, especially given the  "projections" on the increase in value of tree plantations. It is also a  leasehold investment meaning after 20y you don't own anything. So if  anybody thought that the investment would grow at 18.71%pa, that is not  the case. Hope this helps, but please be aware this is my understanding  of the investment. If it were wrong, I would be more than happy to hear  others' interpretation or understanding.


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## Brendan Burgess

The ads in Ireland said "up to 18.71% paid every 5 years"

This is meaningless. 

What does "up to" mean? 

And they did not quote a Compound Annual Rate. 

It also said it was "guaranteed" and they have refused to explain online who gives the guarantee.

If something looks too good to be true, it usually is.

if they decline to explain how it is so good, then you should avoid the product until they explain it.


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## investgreen

*A closer look at the Silva Tree investment*

I read the above mentioned postings with interest and hoped that my own experience might prove useful to others.

I came across Silva Tree some weeks ago when I was searching for alternative investments. I was attracted by the lack of correlation with stock market performance and the guaranteed yields of “up to 18% per annum” mentioned on the Silva Tree website. I requested a prospectus which was well presented and cogently argued the case for investment in growing lumber as a green and attractive alternative investment.

Although I was aware of some negative comments on the web regarding Silva Tree and the old maxim that “if something is too good to be true it probably is” I decided to take a closer look by applying for a $35,000 one hectare 20 year investment in Pauwlonia trees. I found Silva Tree’s personnel to be charming, confident and reassuring during my dealings over the phone and was struck that they tackled allegations that their investment was a scam head on in a diligent, confident and perhaps even aggressive manner.
Up until this stage I had no real information to go on other than the website, Prospectus and my conversations with their UK based employees but signing the application allowed me to receive the completion documents from Silva Tree Panama.

I noted that the completion documents made extensive reference to other documents that were not provided. For example, the Prospectus mentions the involvement of an FSA approved Trustee but the Deed of Trust describing the Trustee’s responsibilities and how they would operate was not provided; also, the lease which would give one one’s rights to grow the lumber would be created at a future undefined date and was not provided. Similarly, there was no technical or expert studies provided which could substantiate the tree growth projections and underpin the business plan and Silva Tree Panama provided no documentation to show that they were indeed the freeholder (though they did warrant to this effect).

I requested that further information be provided and, although all the documents were not produced many were and I was able to observe that the investment appeared to operate in the following way:
•	$35,000 would be paid over to the offshore bank account of the FSA approved Trustee and held in escrow pending creation of a lease under Panamanian law.
•	Following creation of a lease (with unknown provisions) in the name of the Trustee he would issue certificates of proportionate ownership in the name of the investors (or “renters” as described in the document).
•	At this stage (presumably not too far down the road as the monies would be returned to the investors by the Trustee within 12 months) $35,000 minus $1,250 held in escrow by the Trustee for the maintenance contractor ($250 per year for the first five years) ie. $33,750 would be paid over to Silva Tree Panama and that would mark the end of their legal responsibilities to the investors (though not the investors’ responsibilities to them – see below). Future performance of the investment would rely on others.
•	The trees would grow and thrive under the care of the maintenance contractor (appointed by the investor from an approved list of three) who for $250 per year would plant the trees, irrigate, keep free from disease, keep secure, construct access roads, thin out, harvest, transport to a saw mill, process and deliver FOB to a local port.. I noted that the management contract could be terminated by either party with 3 months notice. Furthermore, I noticed that the Forestry management contract between the investor and Silva Tree Panama contained a clause to say that both parties acknowledged that the contract was under the jurisdiction of the courts of England who would not and could not compel performance from a Panamanian legal entity but certainly could do so for a UK based investor. I noticed there was a clause which said that in the “unlikely event” that $1250 was not sufficient to cover maintenance or if a dispute arose between the management company and the renter Silva Tree could intervene to pay monies due to the management company on the renters’ behalf. 
•	The trees – if they complied with certain quality conditions and as long as over 3 years notice was given of the exact quantities involved – the World Pauwlonia Institute would purchase the lumber for a price some 50% of world market values allowing the guaranteed return of up to 18% to be calculated. Using the world market price for Pauwlonia the returns would indeed be staggering. WPI would maintain an (unseen by me) insurance policy to secure their end of this deal.  

At this stage I withdrew from the process.


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## Silva Tree

*Silva Tree Documents*

Removed message.


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## investgreen

*Further clarification*

Dear Silva Tree

Thank you for your warm words - I would like to clarify my position.

I withdrew from the investment as there were many terms in the contract that could best be described as unusual and perhaps more accurately be described as onerous which, when taken together with other documents, meant that the guarantee was dubious. It was clear that Silva Tree would quickly get the lion’s share of the investment monies leaving the performance of the investment and the guarantee in the hands of others.

I cannot possibly comment on the competence of the management contractor but do question whether he can perform his extensive duties for $250 per year and, if he can’t, the somewhat curious arrangement by which Silva Tree appears to be able to pay him more and charge the renters. 

Also, I understand the World Paulownia Institute’s vocation to be “the World’s largest producer and supplier of genetically superior tissue cultured Paulownia seedlings”. Whilst getting into writing options to purchase extensive quantities of lumber may be a new departure for them I note that their latest filing with the US authorities indicated sales of about $300k and showed they had 5 employees.  I was sent a copy of WPI’s application form to their broker for General Liability insurance rather than the policy schedule and would be very surprised indeed if their finalised insurance would cover WPI for option contracts they choose to write.  I note that the application did seem to make a reference to the contract liability regarding the Timber Purchase Agreement with Silva Tree but cannot comment further on the cover they have managed to obtain or will obtain in the future.

Finally, as long as Silva Tree maintains the use of such onerous and one-sided contract clauses (some examples of which mentioned in my previous post) and  to use investment structures that are highly complex and not properly explained by the documentation provided then there is no chance that I would consider future Silva Tree products.


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## Raskolnikov

Brendan Burgess said:


> The ads in Ireland said "up to 18.71% paid every 5 years"
> 
> This is meaningless.
> 
> What does "up to" mean?
> 
> And they did not quote a Compound Annual Rate.
> 
> It also said it was "guaranteed" and they have refused to explain online who gives the guarantee.
> 
> If something looks too good to be true, it usually is.
> 
> if they decline to explain how it is so good, then you should avoid the product until they explain it.


I believe that Warren Buffett has a CAGR of something like 16% since he took the helm at Berkshire Hathaway. These guy are promising nearly 4% better than the greatest investor of all-time.


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## Silva Tree

*Some Clarifications*

Removed message.


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## Complainer

Silva Tree said:


> One can see how an online notice board turns negative very soon and this is why we are reluctant to answer all questions online.


Wouldn't the best solution to this be just to answer all the questions, clearly and specifically?


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## aristotle

I don't think I'll risk my money finding out


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## Silva Tree

*Forestry Figures for the serious people on this blog*

Removed message.


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## Brendan Burgess

No one on this thread is questioning whether or not forestry is a good investment. 

They have asked many questions about whether Silva is an appropriate investment vehicle. 

Forestry could be a good investment while Silva might not be a a suitable vehicle. 

Brendan


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## Silva Tree

*Right vehicle or not*

Removed message.


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## Binomial

Silva Tree said:


> This was set up for our company and not for investors. Our solicitors and the trustee think the vehicle is right for investors, but this is something for each individual to decide.
> 
> It is not up to a supposed moderator to make the claims you are making Brendan.




So Silva is not set up for investors! Then why should anyone invest in Silva?


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## Silva Tree

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## aristotle

Silva Tree said:


> Research our company and our project first.


 
Thats what this whole thread is about, but you are not answering the many questions being asked.


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## Silva Tree

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## Silva Tree

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## aristotle

Silva Tree said:


> What more would you like to know?


 
The question I asked you last May that you refuse to answer...

Who provides the gaurantee on the return and what terms and conditions are attached to that?


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## Silva Tree

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## aristotle

So if the trees don't grow as well as you expect then the investor faces losses? It is not gauranteed so?


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## Silva Tree

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## aristotle

If the returns are not gauranteed then why does your website state...

*Guaranteed returns* of up to *18.71%* p.a. for 20 years.

Anyways, at least it has been cleared up that the returns are actually not gauranteed at all.

Is the investors capital gauranteed? I guess not?


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## Silva Tree

*Guarantee?*

Removed message.


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## aristotle

Ok thanks, this is a lot clearer now.


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## Brendan Burgess

Silva Tree said:


> This investment provides greater returns due to a higher risk level. If your investment risk assessment is low, this is NOT for you.



Well you have heard it here straight from the horses mouth. 

This is a "higher risk" investment.


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## Silva Tree

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## aristotle

But Silva Tree the issue is the way it is advertised as "gauranteed returns" when clearly they are not.


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## Silva Tree

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## canicemcavoy

So there's no contradiction between an investment being both "guaranteed" and a "higher risk level"?


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## aristotle

It seems to me that the only gaurantees is that silva tree get paid the investors money, as you state... "The capital is not guaranteed as it pays Silva Tree back for the investment made by Silva Tree".

For the investor it is high risk as you state after that. If the trees grow as well you expect then apparently there will be returns, if not then the investors looses out.

What exact performance criteria are required to determine if the trees are good enough quality?


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## DrMoriarty

Silva Tree said:


> It is advertised as guaranteed* returns [...] it depends on the growth of the trees.
> [...] The capital is not guaranteed as it pays Silva Tree back for the investment made by Silva Tree [...] We in turn use the returned money for expansion.


Let me ponder this for a moment. Would it be fair to say that in this vehicle, all of the risk is assumed by the investors, and, eh, none by Silva Tree?

Is that what's meant by the "High Return/Low Risk" mentioned in your ad in the Sunday Business Post?



> Want to make up to 18.71% and save the planet?
> 
> The Princess Project is an ethical timber investment with guaranteed returns*
> 
> High Return - Returns of up to 18.71% paid out every 5 years over 20 years*
> Low Risk - Managed by UK FSA regulated trustee
> Low Entry Level
> Help the Environment.


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## Silva Tree

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## Silva Tree

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## DrMoriarty

Not really. Your ad says "High Return/Low Risk".
Earlier you said "This investment provides greater returns due to a higher risk level."
Now you say "This is not classed as high risk, rather medium to high."

You also said "We do not have to explain to seasoned investors what this investment falls under."

I think you've made up my mind as to what category I would put it in. Thanks.


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## Silva Tree

Removed message.


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## DrMoriarty

Right. It both is and isn't high-risk, and investors' returns both are and are not guaranteed. As you already said.

And yes, I'm the one who temporarily closed the thread for consideration. I'm afraid you sent your pm about your lawyers to the wrong moderator.


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## mercman

Silva Tree said:


> We never stated that it was a high risk when we stated it had better returns due to a  higher risk.



And the difference is ????????????? So in your opinion it is not high risk but offers a better return due to a higher risk. Are you trying to redefine the English language.


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## Silva Tree

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## Silva Tree

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## DrMoriarty

Silva Tree said:


> DrMoriarty,
> 
> I was under the impression that this side was owned and operated by Brendan Burgess. Is this incorrect?
> 
> Why is it that the moderators on this blog post their opinions in a negative manner. Surely this is not what the position of the moderator should be?
> 
> There are many posts on this thread that have got nothing to do with our projects and various clearly state negative opinions from moderators. Why is this?


All serious questions are answered in the Askaboutmoney.com , Silva Tree.


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## Brendan Burgess

Silva Tree said:


> We are also being monitored by the governmental body ANAM, who pay regular visits and approve all licences etc. for the project and are keen for Silva Tree to expand its activities.



Silva Tree. I am not sure that quoting AMAM as a referee is a good idea. They have been fooled in the past by another company promoting investment in forestry in Panama. 

President, agriculture minister, ANAM caught up in teak scam.


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## Brendan Burgess

Hi PJ

We don't allow new users to send or receive PM's. 

Anyway, Cynic has not been logged on since April 2010.

Brendan


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## TreeTiger

Interesting read here on Bananama Republic: http://www.bananamarepublic.com/2012/02/24/faq-silva-tree-sustainable-capital-group/

As it is posted in the "Scams & Frauds" section of the website it seems "Silva Tree", now "Sustainable Capital Group" has not been a success story.  I hope no AAM readers have been affected.


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## Brendan Burgess

> This negative campaign seems to have started when a religious group with  an anti-"carbon trading" bias (Christian Science Monitor)



Even the FSA in the UK has an [broken link removed]


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## postman pat

are we all barking up the wrong tree i wonder....



 Pat


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## TreeTiger

Thanks for your interesting response pjsherry – unfortunately it has cost me an hour or more as I read more on this very intriguing story!  Here are a few things I found which will hopefully round the story out a little more:

[broken link removed]
Gives his side of the story and talks about the journalist referred to by pjsherry.

[broken link removed]
Sustainable Capital Group talk about being the first in Panama to receive VCS certification.  This page has a link to details about the certification.

However, on the VCS Project Database [broken link removed] I can’t find the information about SCG, but this may be down to me searching incorrectly?  Panama is not offered amongst the list of countries, and I have tried various keywords with no success.

There is an interesting report by CBRM & Merian Research, November 2010 here [broken link removed] 
Small quote where Silva is mentioned “The case of Sterling Knight Consultants Ltd, London is particularly interesting. The company seems to be connected to Emerald Knight “Ethical Investments” and Silva Tree Panama SA, a firm that presents itself as “an environmental project developer with humanitarian, biodiversity and environmental benefits”. Neither Emerald Knight nor Silva Tree are known to be members of European social investments forums or environmental coalitions.”  There is quite a long section on Sterling Knight, with more mentions of Silva Tree.

Maurice Sjerps is a name mentioned in the report linked above, and there is a story here  about a man named Sjerps, believed to have first name Maurice, who was recently arrested in Panama on suspicion of defrauding foreign investors with a teak scheme.  Perhaps this is a different Maurice Sjerps?

All of this makes me a little uneasy, I have to say, and I think it strange that Silva Tree deleted their posts in this thread – with the explanation “project finalised”.  But there may well be perfectly reasonable explanations.  I do hope everything works out well for you.


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## Brendan Burgess

Folks

There is enough information in this thread for people to make up their minds on whether this investment is suitable for them or not. 

We do not have the resources to check out posts coming from newly registered posters to see if they are genuine or whether they have a vested interest for or against the company.

If a Frequent Poster i.e. a member with at least 50 posts has something to add, feel free to do so.

Any posts from new posters on this company will be deleted without further comment. 

Brendan


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