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Police claim EU carbon credit fraud has topped €5bn

Europol estimates carbon credit VAT fraud carried out by organised criminals could have cost EU billions in lost tax revenue

Source:  Copyright 2009, Business Green
Date:  December 11, 2009
Original URL: Status ONLINE

The European police agency Europol has today revealed that the fraudulent trade in carbon credits that affected a number of countries over the past few months is far more widespread than previously thought and could have cost EU taxpayers up to EUR5bn in lost revenue over the past 18 months.

The agency said in a statement that it believed that in some countries up to 90 per cent of the trading of EU emissions allowances (EUAs) was subject to fraudulent activity.

EUA's which are traded under the EU emission trading scheme have been involved in so-called carousel fraud whereby fraudsters sell carbon credits and collect the accompanying VAT, but then disappear before the money is handed over to the tax man.

Europol said that suspicions of carousel fraud, so named because the fraudster can often buy back credits and then repeat the practice several times over, first arose in late 2008.

Market volumes then peaked in the summer, at ...

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