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
Could all this just be allegory? :^]
The diaphanous nature of the Carbon Offset is one of the things that bothers me. Another is the implications of control of everything we do. Another is the giant multi-headed hydra that it would take to monitor it’s application. My feeling is that this has not been thought through very clearly, and taken to it’s inevitable end. Pamela Grey is correct in saying that it is ripe for fraud. My assessment of this is that western society is creating a virtual cancer that will cause it to eat itself, all in the name of saving the world. Does this make any sense at all?
Bootleggers and Baptists?
Should we call people who trade carbon credits En(vi)ronmentalists?
Mike D. (00:43:45) :
Absolutely brilliant, LOL – have you considered writing sketch show scripts?
I will keep my Carbon Offset certificates where they will be safe. In the Hawaaii vault where Resident Obama keeps his birth certificate. No one can touch or take them from there.
On another note. Some localities pass laws requiring tax stamps to sell dope. The offenders are busted for being in possession of dope without legal stamps. It is an indirect way to nail them. I suspect there is no document trail that can trace the source of these fake notes worth 38 million pounds.
I just received a carbon offset certificate for 1.68 trillion; to match this year’s Obamadeficit.
George
When the carbon credit exchange market (or whatever you want to call it) collapses, will the US Congress and President propose a “bailout” to compensate the poor investors who lost money and who coincidentally just happen to donate money to their political coffers?
This really is not much of a revelation to anyone anymore: fraud and corruption between lobbyists, businesses, criminals and Government Leaders globally is alive and doing quite well thank you.
Just ask the heads of Goldman Sachs and a few other leading banks and they will confirm that Timothy and the Federal Reserve are doing an excellent job.
Simply read the testimony about how the SEC completely ignored complaints from Mr. Markopolos for years that Bernard Madhoff was running a Ponzi scam…
Although this website likes to lambast Al Gore, frankly speaking, the ethical issues in our society run much deeper than just the AGW scam. In reality, the AGW scam (which has corrupted science ethics) simply shows how the corruption has extended to all corners of society.
Anyway, I am tired of all this, so I’ll stop here as I am really busy today downloading a few Gigs of my favorite music off the internet…at least it’s all free these days!
I have had my own carbon credits sceme for some time. We have a whole bunch of California Live Oaks around our plant site, which I go by on my daily luncheon walk to Burger King. I pick up the acorns before the squirrels get them, and store them in an empty water bottle (recycling).
For just $5, anyne who drives an SUV to work, can pay me, and I will go outside on the grounds, and plant one of those acorns for them.
Of course some times the squirrels find and dig up my acorns; but then they forget where some of theirs are; so I do have a good number of hatchlings growing all over the place. Amazingly, the water bottle I keep my merchandise in becomes highly pressurized. Maybe I can shine a laser through the bottle and figure out what sort of gas my acorns are emitting; If it is CO2, then I have a positive feedback carbon abatement system too.
George
vukcevic (05:45:58) :
http://www.vukcevic.talktalk.net/GeoMagField.gif
Congratulations! You just made your own Hockey Stick!!!
Does this mean that temperatures folow geomagnetic data/ sea currents movement?
Here is one site that convinced me the World Currentcy should be : http://www.quatloos.com/
Carbon Credits as such are..
Look Up “Porcine Princess”-classic
Gore is chairman of Generation Investment Management, a hedge fund which is devoted to making its mega-profits by denying economic development and sustenance to billions of people in the developing world—through brokering
and speculating on so-called carbon swaps. Through the carbon swap system, countries that are being starved to death by lack of electricity, are supposed to trade away their futures for a few shekels—the so-called magic of the marketplace.
http://www.larouchepub.com/other/2008/3517gore_brit_malthusian.html
Well done: the arrest and the scam… if business owners were so gullible to fall for it!
Nogw (11:37:56) :
“Gore is chairman of Generation Investment Management, a hedge fund which is devoted to making its mega-profits by denying economic development and sustenance to billions of people in the developing world—through brokering
and speculating on so-called carbon swaps. Through the carbon swap system, countries that are being starved to death by lack of electricity, are supposed to trade away their futures for a few shekels—the so-called magic of the marketplace.”
Mr Gore’s UK partner is an ex-Goldman Sachs man called David Blood. The story is that the business was originally to be called “Blood and Gore”, but it didn’t get through the focus groups. Follow the money, but get out before the bubble bursts!
Sorry, I did not read all of the posts.
So, I may enter thoughts already posted.
Somehow, this is similar to creating money.
You fell a tree? (worth possibly 5.000 to 10.000 USD)
You sliced it to small pieces (involving mechanical force/energy)
You bathe the pieces in acid and other liquids (sorry, babelfish wasn’t capable to translate the proper terms from german to english)
Finally you dry it, run it through a pressure mill and add some ink to it –
and declare – it’s One Billion Dollars by Face?
Why does every nation declare counterfeiting of money (bills, no real money) as a crime? The state does not like competition.
(Operator, if that’s too much OT or otherwise not appreciated, purge it please)
[REPLY – I’ll approve it. I also edited it just a little to improve the translation ~ Evan]
I’m curious how a VAT tax can be assessed on something worthless. Does the tax itself add value? Does the value then increase from zero to the amount of the value added by the tax? If then re-sold to another sucker, er, investor, is the VAT assessed again? At what point is it taxed to the point of becoming priceless? In the alternative, at what point does it acquire any value other than the accumulation of VATs?
The very moment AlGore burped out this cockamamy scheme, a chorus of “Oh, No! Not another ERON!” was heard across the globe.
Falling for this pyramid scheme the first time ’round can be chocked up to ignorance, falling for it twice can only be called stupidity!
Now this same idiots want to control my healthcare? you’ve got a better chance of seeing angels…
Well you know what to say to those selling Carbon Credits – simply exercise your free speech and increase the greenhouse gas emmissions
[ http://www.youtube.com/watch?v=M5WuHhVRZcY ]
David Ball (09:02:28) :
You are right. The monitoring will be next to impossible, claims made over new technology falsely certified to reduce emissions will hide the true emissions. All the while credits are being sold that are in truth used up.
Big time loopholes for every type of fraud imaginable.
You’ll owe your soul to the Credit Trading Store.
A while back Anthony posted and article where Repower America was accepting letters to the editor on their website. Well, they are at it again from a different angle:
So … hey, get on the phone and let your Senators know what you think about Cap & Tax!
This has nothing to do with protecting innocent consumers from being ripped-off. It is entirely about eliminating the competition to exploit the dupes.
Nobody will arrest Gore et al for committing EXACTLY the same scam, but on a massive scale.
This is about gangsters protecting their “turf”.
I am reminded of the saying, “Government cannot create jobs.” Some think that the stimulus package created jobs. Not so. In order for the government to create a job, taxes must be collected in order to pay wages. Only entrepreneurs can create jobs. Guess what else cannot create a job? The stock market. In a way, the stock market is like a governmental entity or federal bank. Businesses, in order to keep stock holders happy, run their business not to sell something worth owning or to create family wage jobs, but to send money to stock holders. In fact, downsizing or moving jobs overseas is a tasty incentive because stock holders get more money.
Some of this is our own fault. Gone are the days when the public put their money in a local bank for safe keeping, earning just enough interest to break even or maybe get a little ahead of inflation. The huge piles of money and interest rates available in the stock market drove the simple family investor to join the fray. We have put ourselves in harm’s way me thinks.
How can you have a “Value Added” Tax on something that doesn’t exist? The seller exchanges money and provides a carbon credit for not doing something that releases CO2 (and in a way that is difficult to measure).
How do you add value to that?
Pamela Gray (14:26:10),
Thank you for reminding me of what got me interested in economics as a young college student. I read Henry Hazlitt’s very short and readable Economics in One Lesson. It really opened my eyes.
Hazlitt clearly shows why government cannot create jobs. It was also the first time I’d heard of the Broken Window Fallacy [explained pretty well here by John Stossel].
That particular fallacy [originally by Frederic Bastiat] destroys the government’s claim that its actions will “create jobs.” But a government job can only be created for by taxing others.
The fallacy goes something like this: a vandal breaks a baker’s window. To cheer him up, people tell the baker that the town glazier will earn extra income from the unexpected work. The glazier will then buy a new pair of shoes with the money. The cobbler will get some extra income, and buy a new table. And so on. The people tell the baker that the town will be that much richer.
But what really happens is unseen: the baker was planning to buy a new suit. But he can’t now, because the money must go toward replacing the window. So the tailor won’t get the extra income from the baker, and he won’t be able to buy his wife that new dress, etc. The town is actually poorer because of the broken window.
Similarly, the government is taking more tax money away from productive workers to create “green” jobs, which will cause those workers to do without something they were going to buy, maybe a car or a computer. And the producers of those goods will lose business because the government has confiscated more of their income. And so on. The country and its taxpayers will be poorer with every new “green” job created.
[I just did a short search and found Hazlitt’s book online. Too bad they don’t teach the Austrian school of economics in high school any more.]
Greg S, great question. And as we’ve seen, carbon credits are already being used to defraud people. That type of fraud will only get worse. Pass the popcorn.