Belfast investor revealed as convicted fraudster


When David Walsh appeared as a new investor on the startup scene in Belfast, Northern Ireland, he looked the part: He wore smart suits, talked the talk, and flattered young entrepreneurs by holding meetings at a suite in one of the city’s most exclusive hotels. And, as one of the partners of new private equity group called Walsh Doherty Capital — which claimed to be “one of Ireland’s most active venture capital dealflow companies”– he seemed to have plenty to offer them.

The trouble is, Walsh wasn’t everything he made out. Contrary to his image, he was, in fact, a convicted fraudster who had been jailed just a few years earlier for stealing the equivalent of a million dollars.

The details of Walsh’s troubled history with the law began to unravel after Belfast-based investigative journalist Lyra McKee published an incendiary investigation, which revealed his background.

Four years ago, he was convicted of a $1 million fraud committed against an English company where he was financial director. Prosecutors found he had used the money to “fund a lavish existence,” operating his scam through a string of lies, bluffs, the involvement of a fictitious Iranian businessman and even claims of kidnapping. The incident led a judge to call out his “extravagance and greed” and hand down a jail sentence for the crime.

At no point during his time on Belfast’s venture scene did Walsh’s prior history as a financial criminal emerge, despite the fact that he was invited to a number of prominent events held by local startup groups — including Invest NI, a government-funded regional business development agency. And though Walsh Doherty Capital talked big, its only significant investment seemed to be two unknown and apparently unlaunched Texan businesses called Shout For It and Tex Mex Games.

However, McKee, also who also works as the editor of MediaGazer, the sister site of Techmeme, says Walsh’s activities didn’t stop at simply concealing his past. She reports he did, in fact, speak to some companies about investing money — before later demanding cash from entrepreneurs under threat of legal action.

She relates the story of one startup founder she refers to as “James,” a repeat entrepreneur who was approached by Walsh with an offer to invest, before he pulled out of the deal and tried to exact a £10,000 ($15,654 USD) “break-up fee” amid claims he had hidden pertinent information about his company.

After receiving this, an inexperienced entrepreneur may have finally been intimidated into paying the full amount. James wasn’t inexperienced. At the advice of his lawyer, he ignored it.

So what’s the reality?

Well, there’s no illegality in Walsh’s failure to reveal his past — though most would consider it rather unethical. But in trying to find out what Walsh did and didn’t do, I came across some important pieces of information about his activities.

First, on its website, WDC claimed to be a “part of the Sebastian Doherty Sebdo Global Banking Group.” In this case, Sebastian Doherty seems to be the “Doherty” in Walsh Doherty Capital, and Sebdo is a shell company whose headquarters appear to be a post office box in the British Virgin Islands.

Earlier today, however, the Walsh Doherty website was taken down and replaced with text saying the business closed down in October, that “statements made on the Internet with regards to the conduct of the firm are strongly denied” and that it has “no legal connection to Sebdo Global Investment Group”.

However, a quick Whois search reveals that Sebastian Doherty was the name used to register a number of domains related to WDC and Sebdo — as well as the website of Shout For It, the American company that Walsh claimed his fund had taken equity in.

The mystery continues

More importantly, though, I couldn’t find any record that Walsh Doherty Capital itself exists as a legal entity.

As far as I can see, there’s no company in U.K. or Ireland registered or trading under the name of Walsh Doherty, nor does there appear to be any independent record of either man running or raising money for a private equity fund in recent years. On top of this, neither this David Walsh nor Sebastian Doherty appear to be accredited investors in Britain, nor do they or any of the companies they claim to represent exist on the register of the Financial Services Authority, Britain’s financial watchdog. This is highly unusual.

When I put the claims and my own questions to WDC in an email, I received a short response saying that the company had a “personal” (rather than a legal) connection with Sebdo, but that it could not respond to specific allegations.

Here’s what they said in full:

We are currently preparing a press release on the allegations made by a web based reporter and will respond to you in due course.

We deny any wrongdoing by the firm, which closed in October 2011.

We can confirm we had no legal connection to Sebdo Global Investment Group other than the personal interest of one individual.

We cannot comment on individual cases as they are likely to be subject to litigation but will respond generally on the conduct of the firm and its operations.

However, the offer to “respond generally” did not seem to include to answering my questions on whether WDC was a legally registered, regulated company, which funds it held, and why Sebastian Doherty’s name appeared on registration documents for web properties linked to WDC if it is only a personal connection.

So we are left at a dead end.

The next step will be to see how Walsh himself, and WDC — which, remember, says it closed down three months ago — takes on the allegations.

Now the startup investment community in Belfast is left to clean up the mess and confusion caused by this controversy. InvestNI, the agency that had previously invited Walsh to a number of events, told me it had no knowledge of his criminal background and said specificall it has “no relationship with David Walsh.” Let’s see if the region’s startups can say the same.



This piece is exactly accurate and stems from physical written documents between ‘James’ and Walsh. Including emails proposing ‘discounts’ to a termination fee they had just applied two or three days earlier if it was paid promptly. Which was then discounted further once that deadline was reached and then retracted altogether. Mo & emcomments, there is a ton of evidence in the background of this story and besides, I’m sure both Gigaom and @lyramckee would not associate with speculation and hearsay.

Bobbie Johnson

Thanks for the comments. I’d urge you to take a look again at my post and at Lyra McKee’s reporting to try and understand why it’s necessary to try and get some answers on this front. His relation with startups and behaviour toward them over financing is precisely why this is an issue. I don’t think there’s a problem with demanding honesty and transparency: in fact, if Walsh had told potential investments about this and proven himself through his actions, then this would have most likely not been an issue.

Two technical points: One, Walsh was given a six year sentence for fraud, with an extra year added later for perjury and perverting the course of justice (a detail I did not put in the original story).

Second, if Walsh is a self-employed and simply calling Walsh Doherty Capital a private equity firm — something that is unheard of in my experience of the field — he would, under British law, have to make it clear in correspondence and elsewhere that he is “David Walsh trading as Walsh Doherty Capital”. That is not the case.

In the meantime, he has only to answer the questions that have been put to him. And I think it’s important to look out for the interests of startups in Belfast and elsewhere. You may not agree.


Bobbie this does seem a bit “thin”. I feel sure you would never have got it past Charles at the Guardian.

WTF does “and even claims of kidnapping” mean? He was convicted of theft not perjury. So Daily Mail/Sun.

As for “I couldn’t find any record that Walsh Doherty Capital itself exists as a legal entity” Well you couldn’t find evidence of me as a “legal entity” or of any of my past partnerships. It doesn’t mean I don’t exist or that I am shady (actually I am registered for VAT and tax), it’s just that I self-employed and not a Limited Company.

I am certain that Mr Walsh is as fine and upstanding a person as his conviction indicates but this piece also has an equally dodgy feel to it.


It would really help if you didn’t try to make others look bad. Does having a criminal record make you the devil? Does it mean you don’t have the right to invest in startups?

Just because you don’t have any money to invest doesn’t mean you should hate on others.

You have no evidence AT ALL of any wrong doing here – you are just setting yourself up for a libel case.

Worthless journalism.

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