CEO in RINs fraud indictment

A Houston federal grand jury has indicted the owner and CEO of two biodiesel companies with renewable identification number (RIN) fraud, in a scheme that allegedly made him over $29 million (€21 million).

The 68-count against Philip Joseph Rivkin, includes allegations of wire fraud, mail fraud, Clean Air Act false statements and money laundering.

'The indictment alleges that beginning around February 2009, Rivkin operated and controlled several companies in the fuel and biodiesel industries, including Green Diesel, Fuel Streamers and Petro Constructors, all based in Houston,' the Department of Justice (DOI) explained in a press release.

'It is alleged that Rivkin claimed to produce millions of gallons of biodiesel at the Green Diesel's Houston facility and then generated and sold RINs based upon this claim. In reality, no biodiesel was ever produced at the Green Diesel facility. The indictment alleges that this scheme allowed the defendant to generate approximately 45 million RINs that were fraudulent, which were then sold to companies that needed to obtain them and resulted in millions of dollars in sales,' DOJ noted.

Under the renewable fuels standard, an obligated party must either blend enough biofuels or separate the corresponding RINs for retirement to meet its mandate, or purchase RINs from others who have surplus RINs.

In recent years, the US biodiesel industry has been the victim of a number of alleged fraudulent RIN cases, making up approximately 5%-12% of the biodiesel RIN market.