Texas Biofuel Tax Credit Fraudster Gets Jail Time

In one of the “Greenwashing 2.0” stories we’ve been following (see here and here), an individual recently was sentenced to over 10 years in jail for his role in running a fraudulent biofuel tax credits scheme.

A Texas federal judge sentenced Philip Joseph Rivkin to 121 months in prison and ordered him to pay more than $87 million in restitution and forfeit $51 million.

Last year, Rivkin, which is not the individual’s real name, pleaded guilty to making a false statement under the Clean Air Act and to mail fraud for his role in the scheme, which included attempts to defraud the U.S. Environmental Protection Agency (EPA).

In the plea agreement, he admitted that he falsely generated renewable fuel credits between July 2010 and July 2011 and sold them to oil companies and brokers, generating over $29 million.

Rivkin was indicted in 2014 for allegedly selling fraudulent renewable identification numbers (RINs).  The indictment alleged that an individual using the name Philip Joseph Rivkin controlled and operated Green Diesel LLC and claimed that the company produced millions of gallons of biodiesel at its Houston facility then generated and sold about 45 million RINs based on the claim.

However, according to the indictment, Green Diesel did not actually produce any biodiesel at its facility, and the defendant allegedly made millions of dollars selling the fraudulent RINs.

Because the fraudulent activity in this case did not involve individual green consumers and consumer products such as water bottles, cleaning supplies, or hybrid vehicles, this would not typically be thought of as a greenwashing case.  But the fraudulent activity does represent a serious instance of 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.

A number of fraudulent biodiesel schemes have been perpetrated in the last few years.  But the authorities have been successful in exposing them and prosecuting the individuals involved.  Some individuals were sentenced to jail time last year in a similar case in Florida.

In view of the proliferation of fraudulent RIN schemes, the EPA has promulgated additional regulations to ensure oversight of RIN generation and improve the RIN market.

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.