FAYETTEVILLE – A Springdale man was sentenced to federal prison Friday after he testified in the fraud trial of two associates related to a failed wind farm project in Elm Springs.
Cody Fell, who worked at Dragonfly International for a time, pleaded guilty to federal wire-fraud and tax-evasion charges in December 2018.
U.S. District Judge Timothy L. Brooks sentenced Fell to 10 months in federal prison, followed by three years supervised release, and ordered Fell to pay $422,330 restitution.
Fell was also ordered to pay the IRS restitution of $30,185 and was ordered to file proper income tax returns in the future.
Until all the financial debts are paid, Fell is prohibited from opening bank or credit card accounts without prior approval of his probation officer.
He was allowed to remain free on bond until Oct. 20, when he is ordered to self-report to prison.
Fell agreed to plead guilty and to cooperate with the government. He testified against Jody Davis and Phillip Vincent Ridings at their fraud and money laundering trial.
Davis and Ridings were charged with nine counts of wire fraud, aiding and abetting wire fraud, money laundering, and aiding and abetting money laundering. Both men were found guilty on all counts on Sept. 3. They await sentencing.
Both Ridings and Davis, Dragonfly’s CEO, were found guilty of conspiring to commit wire fraud. Both were also found guilty of four counts of wire fraud and aiding and abetting wire fraud.
Both men were also found guilty, jointly, of two counts of money laundering, and both were found guilty individually of another count each.
Fell, Davis’ brother-in-law, said he was given more than $100,000 of investors’ money by Davis and Ridings.
In a closing argument at the Davis and Ridings trial, Kenneth Elser, deputy U.S. attorney, told jurors Dragonfly was nothing but a long-term scam netting Davis, Ridings and others more than $700,000 between 2014 and 2018.
That figure doesn’t include the losses suffered by people who did work for Dragonfly and were never paid or the person who was left holding a $2.3 million property loan.
Elser told jurors Davis and Ridings lied, concealed information, and used half-truths and fraudulent documents to lure investors, then they’d split the take and live on it. Investors were told their money was going to pay for specific work on a turbine design or prototype and models or studies, none of which were being done, he said.
Davis and Ridings of Dragonfly scammed six investors in Northwest Arkansas and southwest Missouri, according to an indictment. Investors lost amounts ranging from $13,000 to $300,000, the indictment claims. There were other victims in Iowa and Texas, according to prosecutors.
A lawyer for Davis tried to shift blame during the trial, telling jurors much of the fraud was perpetuated by Fell.
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