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Home / Articles / Boulderganic / Eco-Briefs /  Eco-briefs | Fuel scandal sends Texas man to prison
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Thursday, April 11,2013

Eco-briefs | Fuel scandal sends Texas man to prison

Jeffrey David Gunselman of Texas has been sentenced to 15 years in federal prison after admitting to defrauding the Environmental Protection Agency (EPA) by acting as a business owner of a bio-diesel fuel production company in order to generate renewable fuel credits — then selling them to brokers and oil companies, according to the EPA.

Gunselman formed Absolute Fuels, LLC, in April 2009. The company had no actual bio-diesel fuel producing facility or employees beside Gunselman. Alongside Absolute Fuels, LLC, Gunselman had also created Absolute Milling, LLC; Ellipse Energy, LLC; 21 Investments, LLC; and YGOG Holdings, LLC. Each entity was completely owned and operated by Gunselman and generated a combined 48 million invalid biomass-based diesel renewable identification numbers (RINs).

Fifty-one false transactions were conducted via wire communications, resulting in approximately $41,762,236 in payments from the EPA to Gunselman.

After admitting to the 51 counts of wire fraud, 24 counts of money laundering and four counts of making false statements in regards to the Clean Air Act, Gunselman has been fined $175,000 and must pay more than $54.9 million in restitution, according the EPA.

“Today’s sentence is the second signifi cant penalty against an alleged bio-diesel producer who in fact produced no fuel at all,” Cynthia Giles, assistant administrator for the EPA’s Office of Enforcement and Compliance Assurance, said in a press release. “When invalid renewable fuel credits are sold, it undermines the integrity of an important program designed by Congress to reduce the nation’s dependence on foreign oil and to grow the nation’s renewable energy industry.”

The Renewable Fuel Standard Program was created under the Energy Policy Act of 2005 to “reduce the nation’s dependence on foreign oil, help grow the nation’s renewable energy industry and achieve significant greenhouse gas emissions reductions,” according to the EPA’s website.

The program requires importers and producers of renewable fuel to earn fuel credits (RINs) measured by the amount and type of fuel imported or produced.

There have been two other reported cases of fraudulent behavior in the fuel standard program. In February, Rodney R. Hailey of Maryland, who claimed to be the owner of Clean Green Fuels, LLC, was sentenced to 12 years in prison for selling 9 million fraudulent credits. In April 2012 Philip Rivkin, CEO of Green Diesel, LLC, was allegedly caught generating more than 60 million invalid RINs and was issued a notice of violation, according to the EPA’s website. Rivkin’s case was settled out of court.

— Erica Lindberg

COLORADO SPECIALTY CROP PRODUCERS ELIGIBLE FOR FUNDING

The Colorado Department of Agriculture is seeking proposals from specialty crop farmers in Colorado for their Specialty Crops Block Grant Program.

The department estimates that $640,000 will be available for chosen projects, funded by the U.S. Department of Agriculture (USDA).

Specialty crops are defined as crops that are fruits, vegetables, dried fruits, floriculture and sod.

Crops under this category specific to Colorado include potatoes, onions, lavender and hops, according to the Department of Agriculture.

The program aims to increase competitiveness among specialty crop producers in areas such as marketing and promotion, education and research as well as trade and nutrition.

“Colorado produces a wide variety of fruits, vegetables and horticultural products,” says Casey Palmer, Department of Agriculture marketing specialist. “This grant program helps develop and promote these unique crops.”

Proposals must be received by 4:30 p.m. on May 1 for consideration. For more information or an application visit www.colorado.gov/ag/specialtycropgrant.

— Erica Lindberg

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