In 1990, two young entrepreneurs brought a lucrative proposition to farmers and landowners in the Republic. By planting Christmas trees on a spare acre they were offered the potential of huge tax-free returns on any sums invested.

In hindsight, the more than 500 farmers who signed up to be part of this money spinning venture, would now probably recognise the wisdom of the investor's golden rule: "If it looks too good to be true, then it probably is."

European Forestry Growers was the brainchild of the then 21-yearold, Mr Leo Mohan. Just returned from a period in London he quickly convinced his cousin Conor that there was money to be made in trees.

He had approached a number of banks to support the project some years earlier, but recalled in a subsequent television interview that he was unable to convince them to back his foray into forestry.

His main problem was that he needed to buy the land to plant the trees and would then have to wait for seven or eight years to make a return.

To get around this, he decided to sell his idea to landowners and established European Forestry Growers, with an office in Athlone, Co Westmeath.

The company initially took out advertisements in local newspapers, encouraging farmers to consider the idea of planting Christmas trees for the company.

"I first saw an ad in the Midland Tribune," Mr Liam Feehan, of Banaher, Co Offaly, explains. Shortly afterwards, he noticed the company being featured on the RTE Up and Running programme, part of a series which highlighted up-and-coming Irish companies.

European Forestry Growers won the regional final, having been judged by a panel of experts, which included a representative from a major bank and an accountancy firm. Each week, it received a mention on the programme as it remained among the leading contenders for the series overall award. It ultimately finished as a runner-up.

Mr Feehan said he decided to check out the company after viewing its success. In 1993, together with his parents and brother, he undertook to plant 8,000 of its Christmas trees on their land. "We paid the money up front, around £4,000."

The farmers involved signed a contract to buy the Christmas trees to be planted for 50p each from the company. After three years, it undertook to buy the mature trees back for £3 each, for export to Britain and Germany.

"The company was due to buy back the trees in 1996. Its representative came and marked the ones to be cut, and took 500 for the agreed £3 each. Then last year he returned to mark another 1,600 but they are still in the ground," says Mr Feehan.

"They said the company was having difficulties selling them and offered to buy some from us for £1.50 each." Mr Feehan was prepared to accept that price, even though it was half that originally agreed, because it would at least have allowed him to recoup his original investment. But the company never came back to him.

Many growers insist they had continuous difficulties in making contact with the company, even about the day-to-day care of the trees.

Mr Michael O'Sullivan, a farmer from Kerry, says European Forestry Growers' service deteriorated rapidly once he signed his contract.

"I have had great difficulties making contact with the company. After three years, when the trees were due to be harvested, it kept coming up with excuses why it couldn't buy the trees. They weren't big enough, or something like that. They just kept changing the rules."

Mr O'Sullivan believes that despite the company's claims to the contrary, it had very limited knowledge about Christmas trees. "They produced the expert advice and we relied on it. There was a phenomenal amount of work involved in growing the trees."

Mr O'Sullivan says that despite the obvious difficulties facing growers over the years, it is unfortunate that the situation was allowed to continue for eight years.

At that time, forestry advisers in general had limited knowledge about growing Christmas trees, he says.

The trees were sewn very closely together and needed to be harvested after three to five years to be suitable for sale and to allow younger trees to develop.

One investor claims his trees are so overgrown they are only fit for a bonfire.

Mr James Mulrennan, from Tulsk, Co Roscommon, believes than many should still be viable for sale, even at the reduced rate of £1.50 each. "I know we are fighting a losing battle against the company to get our money, but we should be looking to sell on our product. A bit of help from a State-sponsored body would go a long way in helping us," he says.

A grower, Mr George McGrath, from Co Limerick, gained access to this week's creditors' meeting, but believes there is little chance that he will recover his investment. "I hope there will be something for us. We've got no money. That was our nest egg and our neighbours are in the same boat," he said.