From the UK Telegraph:
Seven arrests in suspected £38m carbon credit fraud
Seven people have been arrested and 27 residence and office locations were raided by police over a suspected £38 million pounds (62.8 million dollars) fraud involving the trade of carbon credits to avoid paying the value-added tax (VAT) which is required in the UK.
excerpt:
By Rowena Mason
Published: 7:36PM BST 19 Aug 2009
Officers from HM Revenue & Customs searched both residential properties and offices in both Gravesend and London targeting an alleged network of organised crime.
Members are believed to have been trading large volumes of high-value carbon credits from overseas sources free of VAT.
Tax investigators believe these may then have been sold on to businesses in the UK charging VAT that is never paid to the authorities.
Read the complete article here
======================
Is anyone really surprised? a Duke University masters candidate Alan Abramson clearly identified the risk this spring, as have many others:
The [carbon offset] market requires validators and verifiers all over the world. The system is already short personnel with these skills. Then there is the question of who pays these people? Regulators need to keep in mind the failure of the credit rating agencies (Moody’s, S&P, etc.) in the recent credit crisis. Markets require trust. Respondents said the only reason certain investors purchased some MBS assets was the Triple-A rating.42 These same respondents say that a significant flaw in the system exists because the credit rating agencies are paid by the bond issuers. A disincentive exists for doing a thorough job. Currently, validators and verifiers are paid by project developers. If we are to learn from the failings of the financial markets, this is an aspect of the carbon offset markets ripe for misconduct.
See the PDF of his masters thesis here
So I guess mine are worthless…
Dang.
These small time grifters are almost innocent in comparison with the big time crooks like Al Gore and his cronies. Where are the lawsuits by those damaged by the failure of Lehman, big in the carbon encumbering market and advised by the likes of Gore and Hansen?
==========================================
As expected. How do you regulate something that does not exist, a credit for emissions not produced. This may be the scam of the century!
I have a billion for which I paid nothing.
Shoot! I’ll have to put them with my wooden nickels.
What a surprise, didn’t take long did it! Mind you, the VAT man from the Inland Revenue department has more power than the police. Be afraid, be very afraid.
At least with a $100 Billion Zimbabwe note you can now buy more than a loaf of bread!
http://www.zimbio.com/Zimbabwe+Issues/articles/157/Zimbabwe+Dollar+notes+sale+eBay
“The Government took decisive action to prevent this type of fraud recurring by zero rating carbon credits for VAT,”
Translation: Hey, get your hands off OUR fraud !!!
How is it you say? ‘Smack me down and call me Samantha?’
This is one of the chickens coming home to the roost. AGW is a scam. Scum scam and these are the first to be caught out. Expect more and the more that are caught the more Joe Ordinary Man In The Street Public – like you and me – will catch on.
Ponzi Scheme. Madoff Scheme. Gore Scheme…
Taxing imaginary things. Brilliant!
what a surprise!
My sense is the whole carbon trading industry is an incestuous lot. Look for rampant carbon trading scams of Enron proportions.
Doesn’t Al Gore own a London based carbon trading company named Generation Investment Management? Pay no attention to the man behind the curtain.
Hope Al is involved. That’d be Karma for ye!
I did not want the government to ask me to stop breathing or have a carbon meter installed in my mouth, so I printed a septillion ( i.e. 1,000,000,000,000,000,000,000,000) in carbon credits… thanks internet.
All this jumping up and down over faster than we had previously thought is for this? Selling cute green shares for a fast buck.
Flim flammery.
Lehman Bros and Enron move over: the real shock and awe of speculative agenda-based gambling just showed the tip of the iceberg.
Our government recently sold free carbon credits for 5euro/ton to “garage”company created shortly before, which sold it to final buyer (Japan) fro 12 euro. Threads go to one of the ruling parties, which “owns” the environmental ministry.
Now we understand why politicians love this AGW.
Kafkazar Investment Management today announced an initial offering of photon offset instruments. During solar minima (including Dalton minima, if the investor has purchased the optional Ice Age Rider), the credits can be exchanged for additional photons. Conversely, during periods of high solar activity, the photon offsets may be purchased at a bargain rate. This will eliminate Global Warming. NOTE: setting fire to these photon credit certificates is strictly forbidden. Any excess funds will, of course, be transferred to Al Gorf’s Swiss bank account.
Just who are the bigger crooks? HMRC and the Government for taxing something that can’t be measured and doesn’t actually exist except as a nebulous idea in the minds of a bunch of nutters whipping up public hysteria (If I see one more clip of steam issuing from cooling towers presented as “Carbon laden smoke emmissions” I’ll start trying to prosecute someone under the Trade Descriptions Act!) – or the “traders” who sell these certificates to smart businessmen who can then wave them at the Green loonies who believe all this rubbish?
Legislators worldwide do not operate on reality or common sense – just on “how do I get these morons to vote for me next time” and at the moment the bleeding heart Green lobby is a good bet. So are the Carbon Trading Certs for the criminal classes.
As seen somewhere on teh interwebz:
Everyone here appears to have missed the point, the scandal is not related to the value or nature of the bonds but that the companies trading them failed to pay tax on them (VAT). That happens with all manner of commodities.
Jimmy,
I don’t know about you, but I’m thinking Haggis credits.
For every credit purchased one Haggis is set free.
So the Brits have a value-added tax. The idea of a value added-tax is being considered in America. WT#?! Didn’t America originally kick the Brits out over taxes? Now we’re taking on one of their ideas? The car America is shifted into reverse. She needs to put it back in drive.
American VAT story :
http://www.washingtonpost.com/wp-dyn/content/article/2009/05/26/AR2009052602909.html
Carbon credits are a commodity. Their price can be manipulated just like any other commodity.
And instead of credit derivatives or oil futures or mortgage-backed CDOs, the new game in town, the next bubble, is in carbon credits…
http://www.rollingstone.com/politics/story/29127316/the_great_american_bubble_machine/7
Video about commodities and the huge potential for out of control pricing :
http://www.rollingstone.com/videos/player/28915225
Regulators need to keep in mind the failure of the credit rating agencies (Moody’s, S&P, etc.) in the recent credit crisis. Markets require trust. Respondents said the only reason certain investors purchased some MBS assets was the Triple-A rating.
Here is a very good documentary about that :
“CNBC Originals – ‘House of Cards’, The Definitive Look At The Origins Of Today’s Global Economic Crisis”
It lays out the case of what happened in America so simply I don’t think anyone could misunderstand.
http://beta.video.msn.com/play/?g=7087777c-2be9-4c22-9b97-7f104553b79b
This is VAT fraud – it’s not related to the environmental value of the carbon credits. It’s not helpful to connect this crime with the value of carbon offsetting.
Dear Sir,
Firstly I must first solicit your confidence in this transaction; this by virtue of its nature as been interly confidential and top secret though know that a transaction of this magnitude will make someone apprehensive and elated but I am assuring you that all will be well at the end of the day. I have decided to contact you due to the urgency of this transaction as we have been reliably informed of you discretness and ability to handle transaction of this nature.
Let me start by introducing myself properly , I am Mr. Henry A. Waxman of the Energy and Commerce Committee and credit offficer with the Carbon Offset Bank of Nigeria Benin branch. I came to know of you in my private search for a reliable and reputable person to handle this confidential transaction, which involves transfering huge sum of money to a foreign account requiring maximum confidence.
The preposition: A foreigner and an American , Mr. Albert Gore, a Carbon Merchant with the federal government of America, banked with us at the Carbon Offset Bank of Nigeria Benin and had a closing balance as at the end of June 2009 worth $351,432,000usd. Valuable effort have been made by this bank to get in you with any of the Gore relative or family have been unsucessful. It is because of the perceived posibility of not been able to locate any of Mr. Albert Gore next of kin (he had no wife or children that is known to us).
The management under the influence of our chairman and members of the board of directors arrangements have been made for the funds to be declared “unclaimed” and subsequently donate the funds to the Cap and Trade trust funds and this will futher enhance the cause of glbol wrming and the world in general.
I now seek your permission to have you stand as the next of kin to the Mr. Albert Gore so that the funds will be released and paid into your account as the beneficiary next of kin, all document and proofs to enable you get this funds will be carefully worked out We have been mandated by the bank to officialy declare the beneficiary within the shortest possible time , that is why we have decided to contact you and more so we are assuring you that you that the business is 100% risk free involvement.
As soon as we receive an acknowledgement of the receipt of this message in acceptance of our mutual business proposal we would furnish you with the necessary modalities and disbursement ratio to suit both parties without any confusion.
If this proposal is acceptable to you do not take due advantage of the trust bestowed on you ,kindly respond immediately with the e-mail address furnishing me with your most confidential telphone, fax number and your exclusive bank account particulars so that we can use this information to apply for the release and subsiquent transfer of funds in your favour.
Thank you in advanced for your anticipated co-operation
Best regards
Mr. Henry A. Waxman, Esq. and Memeber of Congres