Northern Ireland

Scale of Francois de Dietrich 'Ponzi scheme' revealed by liquidators

For the first time, the full scale of a 'Ponzi scheme' which cost Northern Ireland investors millions of pounds has been revealed.

Hundreds of people on both sides of the Irish border lost their money after investing with Donegal-based businessman Francois de Dietrich.

Liquidators have spent 18 months trying to find the missing millions.

It is now known 576 investors paid in just over £20m between them. Just £6m of investors' money has been located.

Those caught up in the scheme included a PSNI detective, gardai, accountants, solicitors, developers and members of the travelling community.

Mr de Dietrich, who is originally from France, is understood to have fooled people into believing they were investing in his business, ETIC Solutions Limited, based at an office in Ballyboffey.

Fled

He got them to part with their money with promise of up to 40% profit in the space of six weeks.

However, it appears he was actually running a Ponzi scheme, whereby the money paid out as profit was actually the cash coming in from new investors.

Liquidators from Pricewaterhousecooper (PwC) have told creditors that during their investigations, they have "found no evidence that the company performed any genuine business".

Mr de Dietrich fled Ireland two years ago, when the authorities froze his accounts and shut down the scheme.

Since then, investors have been waiting to get their money back.

Last January, the businessman was sentenced to 18 months in jail for contempt at Belfast High Court, after he defied a court order to stop taking new deposits from investors.

Image caption Francois de Dietrich fled to his native France after a Belfast court sentenced him to 18 months in jail

When he did not turn up for the hearing, a warrant was issued for his arrest.

Appeal

Six month later, BBC Northern Ireland's Spotlight programme tracked him down to his native France.

He told the programme he was appealing his sentence and insisted his business was legitimate.

However, his appeal was dismissed by the Court of Appeal in January.

To date, only 389 of his investors them have come forward to make a claim, and they will share the £6m that has been located by PwC.

It works out at 20p for every pound they invested.

They are due to receive the payments from early next year.

However, 187 investors who have not yet come forward will not get any money back.

PwC liquidator, Paul Rooney said he could understand people making their own judgements and decisions about investments.

'Perfect storm'

However he added that such decisions also come with "personal responsibility and accountability".

"In 2008, 2009, we had the perfect storm of an economic recession and a banking crisis. People were unsure where to put their money.

"Perhaps an opportunity of an investment, and an early investment, was taken and the implications and ramifications of that are now being felt, not just from a financial perspective, but from the human and indeed the families affected," Mr Rooney said.

Not everyone who invested in the scheme lost money - 81 people made a profit.

They cashed in before the scheme collapsed and shared just over £6m.

BBC Northern Ireland has contacted over 200 investors but none of them wanted to speak publicly about what happened.

Meanwhile, Mr de Dietrich is still a wanted man on both sides of the Irish border.

The PSNI and gardai both want to question him about the case.

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