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Baron Traders Ltd: Another scam company offering carbon credits as investments

In November 2011, Richard Smith exposed a carbon credit scam company called Validated Carbon Credits in the blog Naked Capitalism. Validated Carbon Credits has since gone, but its parent company, Baron Traders Ltd is still selling carbon credits.Smith came across Validated Carbon Credits after a June 2011 article in FTAdvisor, “Carbon credit company hits out at ‘scammers’”, quoted Ellie Richards, director of Validated Carbon Credits, saying that her company was aware of potential carbon credit boiler rooms:

“We applaud your efforts in exposing the scammers who are destroying the industry and ripping off innocent victims with their clever sales patter.
“As a genuine company we have come across these and more. If it sounds too good to be true it usually is.”

Point Carbon also fell for Ellie Richards, and quoted her saying more or less the same thing in a June 2011 article:

Ellie Richards, an investment manager at Validated Carbon Credits, which also sells offsets, said buyers need to check whether the credits are visible on a public registry, meet a specific standard and are protected against delivery risk.
Buyers need to be particularly aware of the returns that have been promised, she added.
“Carbon credits are spot trades and there are no fixed returns. If it sounds too good to be true, it usually is,” Richards said.

Smith looked into this “genuine company”. He found that the company’s website (apart from emitting “an unmistakable and unpleasing aroma; of rat”) had a proxy domain name registration. (So does the website you are reading, but REDD-Monitor isn’t asking for your money in return for worthless carbon credits.) Validated Carbon Credits’ website is now registered in the name of James Richards and redirects to Baron Traders’ website.

Baron Traders is registered in Gibraltar. Smith lists some juicy stories about boiler rooms, tax havens and slack regulatory bodies – all involving Gibraltar and all published in FTAdvisor.

On his LinkedIn page, James Richards claimed to manage an overseas property company called Vogue Estates. Founded in 2000, Vogue Estates offered property in 17 countries, but didn’t set up a website until 2007. Shortly after that, it disappeared. “Remarkable,” Smith comments and adds, “I think Vogue Estates is a figment of Mr James Richards’ fertile imagination.”

Smith then looks at Ellie Richards:

First, here she is apparently dropping another bunch of scammers in it by ratting them out to Ripoff Report. It reads as if some sort of score is being settled.

Oddly enough, the Ripoff Report is about 360 Property Invest and includes names that are linked to 360 Invest Group in another Ripoff Report. (Before it disappeared, 360 Invest Group sold carbon credits as investments. The company was recently featured on REDD-Monitor.)

Smith found another complaint, this time about Ellie Richards, accusing her of stealing databases. “I suppose the purloined mailing list is now being put to work on a Carbon Credit scam,” Smith wrote.

Three days later, James Richards commented on Smith’s Naked Capitalism post. “We will be pursuing you aggressively through the proper legal channels,” Richards wrote. Smith’s response is well worth reading in full. “No you won’t,” he replied. Richards added that he expected, “a full and public apology and punitive damages.” To which Smith replied, “No you don’t.”

Richards explained that Baron Traders is a legitimate company:

We are completely above board, do not handle any client funds and work with a highly credible, long established UK company who have been active in the global carbon markets for a number of years. We introduce clients to them should they wish to invest or offset in carbon. Nothing more, nothing less.

Smith responded by asking for the name of the “long established UK company”. Richards did not reply. On its website, Baron Traders still mentions “a UK FSA regulated company”, still without mentioning the name of the company. On LinkedIn, Baron Traders boasts:

We are partnered with a London company offering trading advice to HNW individuals, UHNW individuals, Institutions, pension funds, and family offices under full FCA regulation. Because they are an investment boutique, the service is personalised to the individual and their investment objectives. On average they trade over 1 Billion per month in a variation of currencies. [sic]

Richards explained that Baron Traders is “under the watchful eye” of the Financial Services Commission:

In Gibraltar we are under the watchful eye of the FSC (similar to the FSA in the UK) and so it would not be in our interest to mislead clients in any way.

Smith replies that this is “rubbish”, as the FSC has never heard of Baron Traders. Sure enough, there is now a note at the bottom of Baron Traders’ website explaining that,

whilst Baron Traders carry out extensive due diligence and make every effort to ensure the opportunities we introduce are thoroughly researched and checked, the products are not regulated by the FSA or FSC and therefore, Baron Traders is not required to be regulated.

Baron Traders sells voluntary credits (VERs) and compliance credits (CERs). CERs are traded on exchanges, the trade is regulated and the price is transparent. That makes it even easier to spot a scam. Predictably, on its website Baron Traders does not provide links to the exchanges where CERs are traded (yesterday CERs were changing hands on the European Energy Exchange for €0.57). Instead Baron Traders displays the following table of predictions of CER prices in 2013:

Baron Traders gives no information about when these predictions were made. Since it is now 2013, perhaps Baron Traders should update its website with the actual CER prices – to avoid the possibility that potential investors could be misled.

In his first article about Baron Traders, Richard Smith couldn’t find any registration details for Baron Traders and he assumed there was no such company. He was wrong about that (and subsequently retracted the claim that the company did not exist). But Smith was right about this:

Validated Carbon Credits is a trading name of Baron Traders Limited, a company operated by an expatriate British scammer called James Richards.


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  1. This is shocking– not acceptable at all to cheat common people-