More RIN Fraud Greenwashers Head to Prison

It was just a few months ago that a blog post reported a criminal defendant pleaded guilty to selling fraudulent renewable identification numbers (RINs).

It has happened again, with recent prison sentences for four individuals in Florida who also pleaded guilty to charges related to a scheme involving false production of biodiesel RINs.

According to this article in a Florida online newspaper, court documents had accused the defendants of profiting by unjustly generating and selling RINs and unjustly claiming biodiesel tax credits for the production and blending of fuel that was not actually biodiesel.

More particularly, as employees and officers of New Energy Fuels LLC, the defendants claimed to process animal fats and vegetable oils into biodiesel.  However, what they actually did was perform minimal processing on low-grade feedstocks to produce a low-grade fuel that was not biodiesel.

They would represent to the U.S. Environmental Protection Agency (EPA) that they had produced biodiesel, generate fraudulent biodiesel RINs, and sell the fake RINs to third parties.  In total, the defendants sold over $15 million in fraudulent RINs.

The defendants also made false claims to the Internal Revenue Service (IRS) to get biodiesel tax credits.

As I’ve said before, I believe this type of fraudulent activity is greenwashing.  The fraud and resulting damage are recognizable when we view the putative RIN purchasers as green consumers, albeit commercial consumers instead of individuals, falling victim to false representations about the validity of renewable energy-based financial products.

The Acting Special Agent of the EPA in charge of the investigation (together with officials from the Dep’t of Justice and IRS echoed this sentiment, speaking to the purpose of RINs and the consequences of such fraudulent activity:

“The Renewable Fuel Standard helps reduce the climate impact of transportation fuel sold in this country.  The criminal activity by these defendants has real consequences.  The defendants manipulated and utilized federal governmental programs to line their pockets by fraud….Companies and managers need to understand there are serious consequences to skirting the rules and undermining the integrity of an EPA program.”

Eric Lane Avatar

Eric Lane

Eric Lane, the founder and principal of Green Patent Law, is an intellectual property lawyer and registered U.S. patent attorney in New York and is a member of the bar in New York and California. Eric has more than two decades of experience working with wind, solar PV, CSP, biofuels, and geothermal, energy storage technologies, carbon capture and sequestration, medical devices, data communications, mechanical, chemical, internet and software.