Thursday, January 3, 2013

Bio-fuel Bonanza!

by Clifford F. Thies

It's to save the planet, you know.

This story first broke on December 3, 2012, although the incident occurred in 2010 and would not have ever come to light except for an unrelated investigation. It has now gone viral.

A company named Bioversel, or is it Verdeo, or Great Lakes Biodiesel, or maybe it's Einer Canada, was engaged in "earning" biofuel credits for importing and exporting biofuels, which it could "trade" in the government-sponsored market for biofuel credits, you know, like trading in carbon credits.

To earn credits for importing, it sent a train-load of biofuel from Canada to the United States; and, to earn credits for exporting, it sent a train-load of biofuel from the United States to Canada. In fact, the same train-load, back and forth, back and forth, twenty-four times during the second half of the month of June 2010, earning a total of $6 million of biofuel credits.

So far, so good. But, then came a misstep. The company, under one of its many names, attempted to sell some product in Europe claiming that it originated in the U.S. when it really originated in Canada (or, was it the other way around), in order to avoid some kind of tax. The Canadian government then started to investigate the company, and then somebody tipped off the Canadian Broadcasting Company about the great train robbery, and now the company, whatever its name, is all over the internet and in deep trouble.

And, who knows how many other shady deals the company has been involved in. This investigation is only now getting underway.

This makes the fourth big robbery of the American taxpayer in the cause of saving the planet through biofuels. In June of last year, Rodney Hailey of Maryland-based Clean Green Fuel, was convicted of selling $9 million worth of fraudulent credits to traders and oil companies. Last month, Jeffrey Gunselman of Absolute Fuels of Texas, pled guilty to the sale of more $40 million worth of invalid credits. And, in a still on-going investigation, Philip Rivkin of Green Diesel of Texas was indicted last Spring for trading 60 million fake credits.

But, you know this avalanche of fraud and bankruptcy, from Solyndra to A123 to Abound Solar to Beacon Power, Ener1, Fisker, Nevada Geothermal, etc., etc., not to mention the sinkhole that is the Chevy Volt, and now biofuel credit scams, it's to save the planet. These are the green business people. The good guys. Not the evil Wall Street investment bankers who took advantage of the hapless government when it was trying to promote home-ownership.

It's difficult enough for the government to keep fraud under control in the private sector. But the problem tends to cascade and possibly even threatens the entire economy when the government facilitates fraud through its subsidy and guarantee programs.

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