This week, a judge sentenced two biodiesel executives to several years in prison for defrauding the federal government’s renewable fuel support and tax credit programs. Fred Witmer, 46, and Gary Jury, 58, are the co-owners of Indiana-based Triton Energy LLC, a company that purported to produce and sell biofuel for use in transportation. Instead, the two men used Triton to orchestrate a scheme to fraudulently produce biofuels credits used to comply with the U.S. Renewable Fuel Standard (RFS).
The RFS policy, which is implemented by the Environmental Protection Agency (EPA), requires transportation fuel sold in the U.S. to contain a minimum volume of renewable fuels. Biofuel producers like Triton create renewable fuel credits, known as Renewable Identification Numbers (RINs), with each gallon of biofuel they produce. Producers then trade or sell their RIN credits to gasoline importers and oil refiners who need the credits to meet the country’s biofuel mandates.
Rather than play by the rules of the RFS program, Witner and Jury generated over $60 million in fraudulent tax credits and RINcredits. The men admitted to falsely representing to the EPA that their corn-based biofuel was used as transportation fuel, when, in fact, it was sold for use in fire starter logs and asphalt and cement production. They also admitted to falsely claiming tax credits based on renewable fuel production, and to deceiving the purchases of their RIN credits.
This is the latest in a recent string of biofuel fraud cases and settlements handled by the Department of Justice. In April, a New Jersey man was sentenced to five years in prison for biofuel fraud. And, in May, DOJ announced the indictment of a Pennsylvania biofuel producer and two of its officers on charges related to fraudulent RIN credits.
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