Nathan Stoliar, a prominent Australian executive, has pleaded guilty in the US to several criminal charges including money laundering conspiracy, for selling fraudulent renewable energy credits, similar in some ways to carbon credits, from Canada to American companies.
Although the case was not prosecuted in Canada, it is the first Canadian instance of renewable energy fraud and money laundering that has been prosecuted.
According to American law enforcement, a Vancouver company controlled and operated by Stoliar, City Farm Biofuel, claimed to produce biofuel which was sold to a US company that was part of the scheme, Global E Marketing. It used the imports of non-existant biofuel products to generate and sell renewable identification numbers (RINs) to third parties so that the latter could comply with EPA renewable energy requirements. Stoliar’s Vancouver company allegedly made US$37 million from the environmental crime scheme. Stoliar is alleged to have created false records to conceal the production, importation, sale and fraudulent RIN generation and used Canadian bank accounts in Vancouver to launder the proceeds of crime.
A Politically Exposed Person in the US and Canada
Stoliar was a foreign politically exposed person in the US and in Canada when he set up bank accounts in Vancouver and Nevada for, inter alia, City Farm Biofuel. According to the Australian media, he was a very close associate of Eddie Obeid, a prominent Australian politician who was Minister of Mineral Resources and Minister of Fisheries in Australia. Their close association is substantially detailed in the international media. According to Australian media, Obeid was recently found by an Australian corruption commission to have acted corruptly in relation to his position while a member of Parliament. Stoliar had other close associations and business associations that likewise made him politically exposed in respect of his dealings in Canada and the US.
Stoliar does not appear to have been charged in Canada for money laundering in connection with the renewable energy fraud scheme in respect of the use of the Canadian bank accounts in Vancouver.
In the US, Stoliar was indicted on January 15, 2014 on several charges including conspiracy, wire fraud, making a false statement and obstruction of justice and faces a term of incarceration of up to 20 years.
Growing Financial Crime Concern with Renewable Energy
Financial crime in renewable energy is a growing concern for law enforcement and is expected to explode as more businesses enter the lucrative renewable energy field. Over $15 billion was lost in the EU from financial crimes associated with carbon emissions trades including VAT fraud, money laundering and theft.