ELM SPRINGS, Ark. – A Springdale businessman involved with a failed proposal to build a wind farm in Elm Springs, pleaded guilty to federal charges stemming from the plan last week.
From 2014-2016, Cody Fell and Dragonfly Industries collected money for a proposed wind farm in Elm Springs. 40/29 News reported when industry experts strongly criticized the plan, saying it wouldn’t work and calling it “physically impossible.” City voters rejected the wind farm in March 2016.
Court documents filed in Cody Fell’s plea agreement describe the Elm Springs wind farm as “a scheme to defraud investors.”
In June 2014, Fell “used material false and fraudulent pretenses, misrepresentations and promises” to get tens of thousands of dollars from investors to pay for what Fell said was a “wind study” at a site in Elm Springs.
In reality, Fell planned to use the money to pay rent and buy furniture, a boat and a lifetime hunting license.
After receiving that money, Fell then falsely told another investor that Dragonfly Industries owed an engineering firm about $300,000 for testing. When the investor paid up, Fell and two others split the money between themselves.
Fell also pretended he needed $13,900 from an investor to buy blueprints from an engineering firm, but really used most of the money to buy a new truck.
In all, Fell personally received a total of $191,530 from the scheme, according to the plea.
Because Fell and the people with Dragonfly Industries wired money to each other and because Fell worked to conceal his income from the IRS, he pleaded guilty to one count of wire fraud and one count of tax evasion.
Together, those penalties include a maximum of 25 years in prison.
Fell agreed to pay restitution to investors as part of his guilty plea.
After voters rejected the wind farm in 2016, the Arkansas Securities Commissioner filed a cease and desist order against Dragonfly Industries. It found that Dragonfly and CEO Jody Davis committed security fraud when it didn’t tell investors about Davis’ 2009 conviction in Oklahoma for wire fraud and money laundering, and when Davis misled investors about a possible $10 million grant from the U.S. Department of Energy.