British Businessman Arrested Over Land Fraud

The British chairman of an embattled agricultural investment firm was arrested Saturday by Cambodian authorities over charges of forging documents and using them in an attempt to illegally purchase thousands of hectares of land, a court prosecutor said.

Gregg Fryett, the main shareholder of Sustainable Agro Energy PLC, which is being investigated by the U.K.’s Serious Fraud Office (SFO) over its investments in Cambodia, was arrested at a cafe in Phnom Penh’s Daun Penh district, said Phan Thannarot, provincial chief prosecutor in Banteay Meanchey province, where the land deals were made.

“We already charged him [Mr. Fryett] with fraud of public documents, and the use of fake documents and we have handed him to the judge to manage this case,” said Mr. Thannarot, declining to provide further details about the case. Mr. Fryett is being held in Phnom Penh’s Prey Sar prison, he said.

Men Hong, a deputy prosecutor at the Military Court, and his son, who were with Mr. Fryett at the time of the arrest, were also questioned by the Anti-Corruption Unit (ACU).

“The ACU actually brought in Mr. Hong for questioning but he was released later because he was not involved,” said Prum Sornthon, chief prosecutor at the Military Court.

Sustainable Agro Energy had its assets frozen in the U.K. in February 2012, just prior to an announcement from British authorities that the company was under investigation for fraud worth more than $54 million. The ACU has been investigating the company’s local operations for more than 10 months, ACU president Om Yentieng said on Sunday.

Through International Green Energy (IGE), Sustainable Agro Energy was meant to use an estimated $11 million in funds to invest in the cultivation of jatropha, a tree whose seeds can be used to make biodiesel, and return a healthy profit to investors. However, not a single drop of biofuel has been produced. The SFO has said that it suspects Mr. Fryett of continuing to procure investment after it be­came clear that operations in Cam­bodia would not be profitable.

As many as 2,000 individuals in the U.K. invested as much as $230,000 each in Sustainable Agro Energy since 2007, according to the SFO investigators.

In January, the ACU arrested IGE’s director Sam­nang Ourm and heavy machinery foreman Soeun Denny on charges identical to those that have been levied against Mr. Fryett. The two men have yet to stand trial and are being held in Banteay Meanchey provincial prison.

Mr. Fryett, who lives in Thai­land but recently returned to Cambodia, wrote a personal letter in February to Prime Minister Hun Sen outlining what he called “considerable issues” regarding his attempts to purchase more than 6,000 hec­tares of land from companies owned by Mao Malay, the wife of Deputy Prime Minister Ke Kim Yan, who was previously commander-in-chief of the Royal Cambodian Armed Forces (RCAF).

“We have paid for the land and the development of the land to Phalla Investments [sic] with confirming receipts and financial records to confirm this…but have not received title to the land or the trees we have paid for,” Mr. Fryett claimed in his letter to the prime minister.

Phalla Development, a firm owned by RCAF General Hanh Chamrong, acted as an intermediary between IGE and two companies controlled by Ms. Malay—YLP Group and Aphivath Mean­chey—in the failed land deals in Banteay Meanchey province.

Neither Mr. Chamrong nor Ms. Malay could be reached for comment on the issue.

Mr. Fryett has previously de­nied that he or other IGE employees were aware that the documents were forged, and has ac­cused Phalla Development of falsely representing their right to sell the land. “The people who supplied this paperwork surely should be in jail, not the staff of the damaged party?” Mr. Fryett said in the letter to Mr. Hun Sen.

In emails over the past week, Mr. Fryett said that he was voluntarily coming to Cambodia to meet with government officials and speak with the court officials handling the case. He was previously questioned by the ACU in January.

(Additional reporting by Kuch Naren and Simon Lewis)

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