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IRS agent shows jurors money trail in failed Elm Springs wind farm  

Credit:  By Ron Wood | Northwest Arkansas Democrat-Gazette | September 1, 2021 | www.nwaonline.com ~~

FAYETTEVILLE – Prosecutors finished up their case Tuesday against two men accused of bilking investors out of hundreds of thousands of dollars in a failed wind farm deal by showing jurors, in detail, how money moved through bank accounts and was ultimately spent.

Jody Davis and Phillip Vincent Ridings are accused of scamming investors in a proposed wind farm project at Elm Springs, Arkansas One. They are charged with multiple counts of wire fraud, aiding and abetting wire fraud, money laundering and aiding and abetting money laundering. Both men have entered not guilty pleas.

Before resting their case, federal prosecutors put on Internal Revenue Service special agent Tim Arsenault who showed jurors, using charts and bank records, how money from investors intended to be used for developing Dragonfly’s wind turbine and other business, ended up being split between Ridings, Davis and their various associates, sometimes on the same day it was received.

Arsenault took investments from 13 individuals and traced it to bank accounts controlled by Ridings, or sometimes Davis, then back out to other accounts, showing where it was eventually spent for personal expenses such as food, coffee, clothes, beauty supplies, jewelry, cars, houses, hotels, airline tickets, vacations and other things from mid-2014 into 2016.

Davis and Ridings, according to testimony, told investors the money was needed, primarily, for an engineering company to finish validating the turbine technology and produce a prototype. The company, Belcan, wasn’t even working on the project at all after Sept. 30, 2015, because they never got paid. They’d already determined earlier the turbine wasn’t feasible as presented by Ridings.

Other investors were told money was needed for wind studies or a model that was being made. There was no wind study and the model maker never got paid, according to testimony.

Davis and Ridings scammed six investors in Northwest Arkansas and southwest Missouri, according to an indictment. The investors are identified only by their initials. They lost amounts ranging from $13,000 to $300,000, the indictment claims.

They weren’t the only ones who got stiffed for work they did for Dragonfly, according to testimony.

Bruce Shackleford, an environmental consultant who worked on the proposed site for the wind farm, said he and several subcontractors he hired were left holding the bag after Dragonfly wouldn’t pay their bills for studies they did about the impact the proposed wind farm could have on endangered species, such as bats and birds, and on potential wetland.

Shackleford said he was told by Davis there were investors lined up and a $10 million grant was imminent. The work was always needed yesterday, he said.

“We were promised over and over, you’re going to get paid, you’re going to get paid,” Shackleford told jurors.

Davis would also say the money was just a couple of weeks from being released, Shackleford said.

“The money was always dangling there, but it never showed up in my account,” Shackleford said. “The only thing I was paid was broken promises. I was never paid a penny.”

Shackleford said he had unpaid invoices to Dragonfly for $115,138.

Adding insult to injury, Dragonfly was claiming on its website it had gotten its environmental permits in record time and had the best clearance ever from the U.S. Fish and Wildlife Service. Shackleford said he knew those claims were not true because there was still at least a year or more of work required to complete the permitting process.

Shackleford said he learned of Davis’ criminal history when it came to light in the local news.

Davis, chief executive officer for Dragonfly, pleaded guilty in 2009 to wire fraud and money laundering after embezzling about $785,000 in Oklahoma.

Davis sent Shackleford an email saying he wanted to ease his mind about his past scars and assuring Shackleford he was going to get paid.

“I am truly a new creation in Christ and my scars glorify him,” Davis wrote.

Christina Hamilton, with the U.S. Department of Energy, said Dragonfly didn’t make the cut for the $10 million grant they said was imminent.

Hamilton said Davis was told in May 2015 that Dragonfly wasn’t likely to get the money when Dragonfly was discouraged by a review board from making a full application for the grant money. Dragonfly never finished submitting the proposal after that, Hamilton said.

Martin Dalgaard, an engineer in California, worked on a static model of the turbine for Dragonfly in 2018 and early 2019 but it was never completed, he said. Ridings kept referring to the model as a proof of concept, which it was never intended to be, Dalgaard said.

Dalgaard told Ridings and Davis the model couldn’t be used to verify or calculate the efficiency of the design. Dalgaard said he also had doubts the turbine would work, based on the information provided.

Davis and Ridings were indicted in May 2019.

Dragonfly sought to rezone 312 acres in Elm Springs in late 2015.

Opponents of the wind farm collected petitions to force a special election March 1, 2016, to undo the October 2015 annexation of the wind farm site by the city. Voiding the annexation passed 483-273. Dragonfly announced it was dropping the project later the same week.

Rescinding the annexation placed the needed site approval into the purview of Washington County officials, who were skeptical of the project, according to news accounts at the time.

Dragonfly also drew the scrutiny of the Arkansas Securities Department. The department issued a cease-and-desist order against the company Aug. 11, 2016, which prohibited Dragonfly from efforts to sell unregistered securities to investors. State Securities officials also contacted the FBI.

[rest of article available at source]

Source:  By Ron Wood | Northwest Arkansas Democrat-Gazette | September 1, 2021 | www.nwaonline.com

This article is the work of the source indicated. Any opinions expressed in it are not necessarily those of National Wind Watch.

The copyright of this article resides with the author or publisher indicated. As part of its noncommercial effort to present the environmental, social, scientific, and economic issues of large-scale wind power development to a global audience seeking such information, National Wind Watch endeavors to observe “fair use” as provided for in section 107 of U.S. Copyright Law and similar “fair dealing” provisions of the copyright laws of other nations. Send requests to excerpt, general inquiries, and comments via e-mail.

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