Environmental Fraud

September 27, 2018

NGL Crude Logistics LLC, formerly known as Gavilon, Inc., has agreed to pay a $25 million civil penalty to the Environmental Protection Agency (EPA) to resolve allegations of RIN fraud through violations of the EPA's Renewable Fuel Standard (RFS) program. In 2011, NGL bought millions of gallons of biodiesel, which came with about 36 million RINS—or Renewable Identification Numbers, which are generated when certain renewable fuels are produced, and which are used for tracking purposes. According to the complaint, NGL sold off most of the original RINs, then sold the biodiesel as unprocessed feedstock to another company, Western Dubuque. After Western Dubuque reprocessed the biodiesel, it sold the fuel back to NGL with another set of RINs, which NGL then sold off again. The fraud was eventually revealed through a tip from other program participants. DOJ

August 24, 2018

Executives of Utah-based biodiesel company Washakie Renewable Energy, and another individual associated with NOIL Energy Group in California, were indicted for falsely claiming over $500 million in renewable fuel tax credits. The individuals allegedly created false production records and other paperwork to make it appear that fuel transactions that qualified for the tax credit were occurring.  The indictment also included allegations of money laundering.  DOJ

July 24, 2018

Attorney General Barbara Underwood announced guilty pleas by Albany Environmental Consultants, LLC ("AEC"), its owner Ronda Dolan, and a project manager Brian McLaren for defrauding customers in NY by posing as a licensed asbestos testing company. AEC's license to test for asbestos had expired in 2014 but it used the name of another company to charge customers $40,000 overall for asbestos testing services just to have the work later redone by a licensed testing company. NY AG

July 6, 2018

North American Power Group Limited, along with its owner Michael Ruffatto, have agreed to pay $14.4 million as a result of allegations that they submitted false claims under an agreement with the DOE to carry out data collection and carbon sequestration projects at a Wyoming energy site.  Rather than seek reimbursement for work done, as they claimed, the defendants had submitted invoices reflecting personal expenses like travel, jewelry, and car payments.  Ruffatto was also sentenced to 18 months in prison for his role in the scheme.  DOJ; USAO WDPA

June 18, 2018

Gina Holley, a Tennessee-based tax preparer, pleaded guilty to filing false claims with the IRS. According to the charges, Holley improperly claimed that tax payers were entitled to fuel tax credits, resulting in a loss of over $400k of tax revenue. USAO Western District of Tennessee

June 5, 2018

Great Western Drilling Company agreed to pay $600,000 to settle allegations it violated the False Claims Act by underreporting and underpaying federal royalties due on natural gas extracted from New Mexico sites the company leased from the federal government. USAO DCO

June 7, 2018

A prime contractor joint venture between AECOM, Bechtel, and CH2M Hill, Washington Closure Hanford, LLC, performing environmental clean-up at the Department of Energy's Hanford Site, has agreed to pay $3.2 million to settle a case first brought by whistleblowers under the False Claims Act.  The case alleged that defendant awarded subcontracts reserved for small disadvantaged business to a company that purported to be eligible for such contracts but was in fact a pass-through front company for a larger entity.  The whistleblowers will receive $643,000 as a result of the settlement.  ED WA

May 24, 2018

Two Honolulu-based fishing companies, their managers, and vessel operators, agreed to pay collective penalties of more than $42,000 to settle claims related to the discharge of oily waste into ocean waters from two commercial fishing vessels; the companies and individuals also agreed to implement operational improvements and other compliance measures. USAO DHI

May 10, 2018

Japanese shipping company Nitta Kisen Kaisha Ltd. was convicted and sentenced for falsification of an Oil Record Book to cover-up intentional oil pollution from the Motor Vessel Atlantic Oasis. The company was ordered to pay a fine of $1 million. DOJ