Energy

Biofuel Bandit’s $15 Million Art Collection About To Be Auctioned Off

(REUTERS/Peter Andrews)

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Chris White Tech Reporter

A group of prison-bound biofuel credit bandits, fraudsters, and tax evaders are about to have millions of dollars of their assets and artwork sold off by the high-end auction house Christie’s.

One of the fraudsters, Green Diesel CEO Joseph Rivkin, who was convicted earlier this year of tax evasion and biofuel credit trade fraud, will have his massive artwork collection – valued at $15 million – put on the chopping blocks by Christie’s.

A Justice Department complaint notes that “the artwork — bought with money from the sale of fraudulent credits for renewable fuel — was transported in interstate commerce knowing that it was the proceeds of fraud and was utilized in laundering the proceeds of fraud.”

Rivkin was convicted of peddling biofuel credits dolled out by the Environmental Protection Agency’s biofuel program.

The U.S. Attorney General Office of New Jersey “consigned the confiscated works to Christie’s, which will sell them in a series of themed auctions” in New York starting in February, reported The Art Newspaper.

Rivkin brought the District of New Jersey into the mix, after sending 396 packages of his 2,000-piece artwork collection to a warehouse on in Newark, located outside of New York City.

“The artwork was stored there until late June 2012, when it was moved to a warehouse in New York on its way to Spain,” the Justice complaint reads. The artwork was seized in July of 2012.

One of the priciest ill-gotten photographs, according to the Washington Examiner, is the “Georgia O’Keeffe” by Alfred Stieglitz, bought for $675,000 by Rivkin.

After the investigation on Rivkin concluded, it was found that he made out with nearly $80 million from selling the fake renewable fuel credits over a year and a half. At no time did he produce biofuel.

The fraudster was indicted last year by the Justice Department on 68 charges of money laundering and mail fraud, for selling more than $29 million phony credits to ConocoPhillips and Citgo, among other oil companies. He faces a decade in prison, and will be required to pay $51 million in restitution to his victims.

The entire incident unfolded after Green Diesel LLC, in the mid-2010s, claimed such lofty production levels that it raised red flags among regulators, prompting EPA officials to send investigators to the Houston-based Green Diesel in the summer of 2011. By the time the EPA rendered his biofuel credit swapping a fraud, Rivkin had split the scene, making tracks for Spain.

His assets included “a multimillion-dollar art collection, a Bentley, Maserati, Lamborghini and a Canadair Ltd. airplane,” according to a report filed earlier this year in the Houston Chronicle,

The scandal is widely considered a black mark on the federal government’s renewable credit-swapping program.

Following the debacle, oil company CEO’s howled with indignation after being fined by the EPA for selling phony credits, even after proof was uncovered showing they were unaware the credits were fraudulent. The EPA later designed a rule making biofuel and oil companies responsible for assuring the credits they receive are authentic.

Authorities believe Rivkin could be part of a larger ring of biofuel bandits, a gang that reached its zenith in the latter half of the 2000s.

Police apprehended a 55-year-old Swiss national man at a Vienna airport on Monday who, Reuters reports, is suspected of money laundering and tax evasion in connection with the kind of biodiesel fuel trading Rivkin is convicted of doing.

The Swiss national is suspected of using a complex network of bank accounts to trade in carbon emission certificates, and of evading the $135.8 million in taxes.

The arrest is part of an “investigation relating to so-called carousel trades made in 2009 and 2010, in which buyers imported emissions permits in one European Union country without paying value-added tax (VAT) and then sold them to each other, adding VAT to the price and generating tax refunds when no tax had been paid,” reported Reuters.

All of the proceeds from Christie’s auction, to be partitioned out by the Justice Department, will go to the victims of Rivkin’s scheme — ostensibly the biofuel companies that were bankrupted and bilked out of money.

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