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Maryland businessman facing federal fraud charges

The U.S. government is interested in developing renewable energy sources and lately, it has been putting its money where its mouth is by offering businesses financial incentives to explore this burgeoning field. Many companies are seeking to take advantage of these incentives in the hope of creating lucrative business endeavors. Unfortunately, one Maryland businessman may have abused this incentive scheme.

The federal government has filed suit against the man for allegedly using $9 million he earned through the sale of renewable fuel credits to buy expensive automobiles. According to the U.S. Environmental Protection Agency, the man committed fraud when he claimed to have obtained a large amount of biodiesel using discarded cooking oil from local restaurants.

RINs, a development of the EPA, are intended to be credits that companies whose production of renewable fuel exceeds federal guidelines can sell to other companies that have not yet met their yearly quotas. Each RIN is a 38-digit code that must represent both the volume of excess fuel credits being sold and the type of fuel.

The man is facing charges including money laundering, wire fraud, and violations of the Clean Air Act, all of which are felony charges. The EPA alleges that the man, fraudulently sold more than 32 million RINs in a short period of time.

The federal government alleges that the man used his company to sell RINs to multiple brokerages and oil companies, claiming that his company manufactured the biodiesel to cover the RINs. According to the government, the man's company never manufactured any of the fuel.

Among the purchases that the Maryland made using the money he earned through the ID number sales were a Maserati, Ferrari, and Lamborghini, according to the EPA. The federal government also alleges that the man purchased jewelry, real estate, and multiple other vehicles such as a Rolls Royce, several BMWs and Mercedes Benzs.

Source: Reuters "U.S. alleges $9 million biofuel scheme paid for exotic cars," Timothy Gardner, Oct. 4, 2011

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