The Forest Mafia: How Scammers Steal Millions Through Carbon Markets

In addition, Nilsson's supposed carbon-credit firm began looking more and more like a shell company. It didn't have a functioning website or a physical office, according to a report from The Sydney Morning Herald.

After Pantone and the Matses shared theses details with AIDESEP and the Peruvian human rights monitor Defensoria del Pueblo, as well as the local newspaper, critics quickly labeled Nilsson a "carbon cowboy," and his plans began to unravel.

According to reporting by GlobalPost's Simeon Tegel, Defensoria del Pueblo instructed the Matses against signing a contract they couldn't read. After learning this, Nilsson stormed into the group’s office. 

“He shouted. He insulted us, and we told him to leave,” Lizbeth Castro, the director of the office, told GlobalPost. “He said he was going to sue us and this would not stand. We told him, no problem, sue us. But we will keep on doing our work.”

In April, the Matses general assembly rejected the project.

But Nilsson continued to search for ways to get it off the ground, setting up meetings with another impoverished indigenous group, the Yaguas. He also dropped the Sustainable Carbon Resources Limited moniker and began operating under a new entity called Amazon Holdings. 

By October 2011, he had convinced Javier Fasenando, the president of a Yagua federation, to sign a deal that would allegedly provide profits to the community "in return for rights to the 'wood' on their land." 

According to GlobalPost

Fasenando said that he understood the terms of the agreement. “Those who criticize it come from other communities,” he said. “They are envious.”

But at the end of our interview in Spanish, Fasenando struggled to confirm even the spelling of his own name. Other indigenous leaders confirmed to GlobalPost that he is unable to read or write.

Fasenando also was unable to tell me where FEPYRA’s copy of the agreement was.

Nilsson declined to provide a copy of the contract to GlobalPost, saying that he needed written permission from the Yagua communities involved in the deal.

Then, in an undercover operation led by investigative journalists with 60 Minutes Australia that aired in July 2012, Nilsson explained the real extent of his plan for the carbon deal to a producer posing as a potential investor as they sat over a huge map of the territory. 

David Nilsson: It’s going to be billions.

Producer: Beg your pardon?

David Nilsson: Billions. I just, I’m scared to quote it, because it’s fucking huge, put it that way.

...

David Nilsson: My contracts are 200-year contracts, etched in stone, so when the carbon’s gone, people can come through and harvest the rainforest there. We’d have a forest management plan they can reforest, they can plant palm oil, they can cut all the timber. No one can stop them. No one can stop them.

Producer: But by doing this carbon plan, you’re stopping that happening?

David Nilsson: Yeah, but the carbon plan only goes for 25 years. The contracts still run and there’s enough timber there to supply the world down there. China will love it.

The project would profit not only from carbon credits, but also from felling the very forest it was allegedly protecting. Once the lead investigator, Liam Bartlett, revealed himself, Nilsson simply said that it wasn't a scam, and declared the interview over. 

More than a year later, Nilsson refuses to discuss the details. Reached for comment by The Atlantic twice on his cell phone, he hung up after we identified ourselves. He did not respond to questions sent to his email address. 

He has also attempted to smear anyone who questioned his schemes. He filed charges against Pantone for fraud in Peru (Pantone was eventually cleared of any wrongdoing) and later set up a defamatory website that accuses him of horrific crimes. Nilsson also filed criminal charges against a Matses leader for fraud. 

Chris Lang, a long-time environmental advocate who was one of the first to report on Nilsson’s scams on his website redd-monitor.org, received an email from his service provider, Bluehost, in August of 2011 that forced him to delete "all images and references to the name" of Nilsson. The company “had received a ‘report of Terms of Service Violations,’” which, under its policies, includes divulging private information about third-parties without their consent. 

After the 60 Minutes investigation, Nilsson attempted to impugn the credibility of the Australian journalists Stephen Rice and Liam Bartlett. 

In an email to The Atlantic, Rice explained: 

Nilsson is demanding that I be sent to jail for entering Peru illegally on a tourist visa. In fact, I was there on a legitimate journalist visa…

Most of [the online attacks against me and others are] just semi-literate rubbish, with laughable sources as “evidence,” but there’s no doubt Nilsson is pushing to have criminal charges laid against Liam Bartlett and I in Peru to make it difficult for us to return. 

He’s lodged a 72-page complaint against me with the Australian journalists Association alleging I breached the journalist’s code of ethics and another against our television network (Channel Nine) with ACMA, the Australian broadcasting regulator. None of that is of any concern – our story was entirely accurate – but the complaints reveal the manipulation Nilsson employs.

Though there is a warrant for Nilsson’s arrest in Peru (for defamation, which is a criminal offense there), no international law enforcement organizations have yet investigated him for his alleged crimes. The Yagua have not received any money from him, according to Al Jazeera. It's unclear whether he's still peddling carbon projects to potential investors. 

Presented by

Ryan Jacobs is a former producer for TheAtlantic.com.

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