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A cautionary tale about carbon credits, involving Eco Business Management, Eco Asian Consulting, SJL Risk and Abacus Advisory. Oh, and Montague Pitman, Carbon Neutral Investments, MH Carbon and Eco-Synergies

Like many other people who were tricked into buying carbon credits as investments, Craig Jamieson found out too late that the carbon credits are near-worthless. He wants to publicise what happened to prevent others from being taken in and in the hope of getting justice.

Jamieson got in touch with a company called Eco Business Management after he was told about them by a friend who had also invested. On its website, the company claimed to be “an organisation that treasures its role as a leader in the carbon finance industry”.

Eco Business Management is one of the companies for which Carbon Neutral Investments provided “clearing and settlement services”. (For more background about Carbon Neutral Investments, click here.)

David White, a broker at Eco Business Management, sold Jamieson a first batch of carbon credits in January 2013. The credits came from a wind farm project called Caprock Wind Ranch in New Mexico, USA.

Jamieson told REDD-Monitor that White “constantly alluded” to the fact that Google had invested US$200 million in a wind farm in Texas.

“Emotional manipulation”

White explained to Jamieson that Eco Business Management bought carbon credits from regulated companies: Eco Asian Consulting in Singapore and SJL Risk in the UK. White wrote that when requested Eco Business Management would sell the carbon credits and deposit the money in Jamieson’s bank account within three weeks.

Once he’d bought the carbon credits, Jamieson received documents from Eco Business Management telling him how much his “investment” had increased in value.

White persuaded Jamieson to invest in two more projects: Konaseema Gas Power, India; and Salto Pilao Hydropower, Brazil. In total, he handed over £20,000. Jamieson told REDD-Monitor that,

“David White’s emotional manipulation was very effective. He talked about how he recently lost his father and how he was going home to spend time with his family. He kept mentioning the satisfaction he got from helping small investors like myself rather than other millionaire investors which he looked after. It built trust which made you feel comfortable about investing.”

But when White made another offer of £20,000 worth of carbon credits from an Indonesian project run by MedcoEnergi Associated Gas Recovery and Utilisation. With a 30% profit within three weeks, it sounded too good to be true. Jamieson’s suspicions grew when Eco Business Management warned against “disclosure to anyone of the details of the transaction”.

Things fall apart

On 8 April 2014, Jamieson contacted Action Fraud and the Financial Conduct Authority. By coincidence, six days earlier, the Financial Conduct Authority had put out a warning about Eco Asian Consulting which was “providing financial services or products in the UK without [FCA] authorisation”. Eco Asian Consulting had provided Jamieson with the credits from the Caprock Wind Ranch project.

Jamieson told Eco Business Management to sell his carbon credits. He was told that, “this is not a ‘good time'”. Jamieson said he would visit the Eco Business Management office, but was told that, “the offices are closing down”, “the company is in a state of flux”, and “we will be in touch”.

White told Jamieson he was “going away” for a few weeks, to work on other projects. White handed Jamieson over to someone called Philip Clarke, who told Jamieson that his carbon credits would soon be sold. No prizes for guessing that Clarke was lying.

Then Eco Business Management’s website disappeared. (It was last saved on in July 2013.) The company’s phone number didn’t work. Emails bounced.

When Jamieson tried to contact Eco Asian Consulting, the company’s phone number didn’t work. Emails bounced. Eco Asian Consulting’s websites are still live, however.

Jamieson succeeded in contacting SJL Risk. This was the UK-based company that he had paid for the carbon credits from the Konaseema Gas Power and Salto Pilao Hydropower projects.

SJL Risk is now in liquidation. The company’s website looks almost the same, but under the name Carbon Traders:

SJL Risk told Jamieson they had never heard of Eco Business Management and told him that his broker for these two projects was Abacus Advisory. That was the first Jamieson had heard of this company. Philip Clarke was the sole director of Abacus Advisory, until it went into voluntary liquidation in April 2014.

Clarke argues that Jamieson,

“quite simply bought investment products that do exist through a perfectly legal route and, now that the market has moved against him, is screaming fraud.”

But it turns out that Abacus Advisory’s London address was a virtual office, and the firm was actually based in the Marshall Islands.

In December 2013, Eco Business Management requested voluntary dissolution. On 14 January 2014, the Registrar of Companies gave notice that the company would be struck off the register on 14 April 2014, unless “cause is shown to the contrary”. The company is still registered at Companies House and has not gone into liquidation.

David White

David White was the name of the broker who took £20,000 from Jamieson in exchange for near worthless carbon credits. White has a history of this sort of thing.

In January 2007, David White was one of the founders of a company called Montague Pitman, along with Richard Beese and Thomas Knifton. The company used high pressure sales tactics to sell penny shares to retail investors.

FT Alphaville wrote about the demise of Montague Pitman under the headline, “The little bucket shop of horrors“.

From Montague Pitman, Thomas Knifton (White’s co-director at Montague Pitman), moved on to Carbon Neutral Investments (now called Opus Capital Ltd). On his LinkedIn page, Knifton described his job with CNI from September 2010 to February 2012 as “Procurement of Carbon Credits for Offsetting purposes”. From October 2011 to January 2012, Knifton was a director of Carbon Neutral Investments.

David White also moved on to selling carbon credits. He and Richard Beese set up a company called BW Carbon. The company at one time shared the same address as MH Carbon. Now in liquidation, MH Carbon was one of the most notorious of the UK-based companies that sold carbon credits to retail investors.

MH Carbon was also one of Carbon Neutral Investment’s “Clearing Members“.

A company called Eco-Synergies Ltd was the exclusive supplier of carbon credits to MH Carbon. David White was at one time a shareholder in Eco-Synergies, along with Richard Beese and Gavin Manerowski (who was a director of MH Carbon).

In May 2014, the UK High Court shut down a web of carbon credit boiler room scams with Eco-Synergies at the centre. The companies scammed retail investors out of a total of £19 million. But no action was taken against the directors of the companies or against the brokers who sold the carbon credits.

Meanwhile, Craig Jamieson, along with plenty other retail investors scammed by boiler room brokers, is still looking for justice, and for his money back. “This is a scheme running into the millions, which has had a disastrous impact on so many people trying to make ethical investments,” he told the Sunday Herald. Jamieson has set up a website and is asking for others who are victims of this scam to get in touch via the website.

Jamieson told REDD-Monitor that he is “confused and disappointed by the reaction of the authorities”. He adds that “Action Fraud were only forced to engage with me after I lodged an official complaint.”

He thanks the Insolvency Service for being helpful and engaged, but says they are “dealing with very complex cases from an under-resourced position”.

“How can companies be officially registered with less difficulty than opening a bank account?” Jamieson asks. “Fraudsters then use these registered companies, along with fake addresses, as a means of projecting legitimacy to investors. This issue could be addressed with relative ease.”

And he asks why the fraudulent companies are only closed down, with no penalty for the people running the fraud.

“If you’re not punishing people for stealing and wrecking others’ lives, they’ll obviously keep doing it. This lack of action is not just heartbreaking and frustrating for those who have in many cases been defrauded of their entire life savings, it is an actual incentive to criminals.”


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  1. At least one of the problems is that the boiler room operations have made so much money that they can afford to hire specialised corporate lawyers, who know exactly how to set up these scams and keep these companies within the word of the law (if not the spirit). The more I have looked into it the more I have realised that there is a whole ecosystem around this business: boiler rooms, recovery rooms, corporate lawyers, publicity and marketing agents, “reputation management” firms, libel lawyers, financiers, solicitors and barristers offering help and advice to those scammed, all taking their slice of the pie. It is easy to see where the scam starts but difficult to see where the scam ends.

  2. The story is all too familiar. Unfortunately the scam has pretty much run its course so current warnings are a bit like shutting the gate after the horse has bolted.

    The authorities response has been a disgrace. En masse victims have reported their cases to Action Fraud and other bodies. The police have closed investigations due to perceived lack of probability in gaining a conviction. So even if the Insolvency Service close down companies the perpetrators leave with their fraudulent gains and can easily set up another scam. You couldn’t make it up.

  3. Mr Lang,

    As much as I enjoy reading your investigative journalism, can you please attempt to akin your style to The Guardian instead of the Daily Mail.

    Carbon Neutral Investments never provided any services for Eco Business Management, if you have evidence to the contrary then please provide it.

    However, if no such evidence can be provided then I would hope you would remove the fallacious statements you have made from this blog. Or are you in fact just attempting maximise website hits by including Google Key words which may be commonly searched?

    Joe Bloggs

  4. @Joe Bloggs – Thanks for this. Click on this link for an archived copy (dated 20 December 2012) of Carbon Neutral Investments’ List of Clearing Members: The link is included in the post above (click on the word “provided”).

    Here’s a screenshot (Eco Business Management is at the bottom of the screenshot):

  5. They never traded, thus there was no actual connection.

    I’d be interested if you would comment on the reasons why companies listed above could have been ‘suspended’?

    I’d also be interested in your comments surrounding recent research carried out by Imperial College stating that each carbon credit provides around $664 of benefits per tonne to the local communities:

    Furthermore, I’d also be interested to learn you views from the recent UN Secretary General’s Climate Summit in New York which brought together over 120 Heads of State and Government and ministers with leaders from finance and business, civil society, sub-national authorities and local communities. Its aim was to catalyze action on climate change and mobilize political will towards a global agreement by 2015.

    South Africa are already introducing a ‘cap and trade’ scheme whereby VER carbon offsets will be purchased by companies to mitigate emissions. Similar schemes are also planned in China and Russia. If these schemes are in fact implemented, is it not possible that VER carbon offsets could become more liquid and investors receive a return whatever that may be?

    If you actually cared about the investors you discuss in these blogs, would it not make more sense for you to lobby to the 2 global registries (Markit and APX) would control the voluntary carbon market, for the purpose of allowing a secondary market? Without a secondary market it is impossible to sell the assets held, the registries themselves know this, and do nothing about it.

  6. London is still packed to the gills with boiler rooms selling all manner of securities. The city run on this business.

  7. @JoeBloggs: Its hardly fair to blame the registries, there is no secondary market for VERs largely because they were never intended to be investment products in the first place. Your link to the benefits that carbon credits provide to local communities is irrelevant in this context, the post is about overpriced VERs being missold as investments by boiler room scammers.

  8. @BrokenArrow

    With reference to you first point; I never suggested the current situation was the registries fault nor does it matter that credits weren’t intended to be investment products.

    There are many assets in the world which were not intended to be investment products cars, art, wine, mobile phones etc etc. Such instruments are governed by supply and demand. My point is that a lot of people are currently holding credits, so what can be done about it? If all the boiler rooms were liquidated, assets seized what any money be generated? No. If the boiler rooms directors ended up in court etc, where would the money go? To lawyers, barristers and receivers. Would money be generated? No.

    The only possible chance that any of the investors holding credits have to regain any monies is for the registries to allow a secondary market. At the moment if someone had personally arranged a buyer for their credits, they would not be able to sell them, as the registries would not allow it.

    This is what Mr Lang should be attempting to facilitate if he cares about the investors.

    With reference to my point about the Imperial College paper, Mr Lang is only interested in destroying the carbon market, as he doesn’t agree with it. So I wondered his thoughts on the positive conclusions of the paper by one of the top institutions in the world.

    Finally, the only way any investors would ever receive any investment return is if the carbon market booms. This is something Mr Lang does not want to see happen. So my point is that he does not care about the investors, he is not some ‘Robin Hood’ character. He is using the investor loses to further his own agendas, whilst pretending to be on the side of the investors.

  9. @JoeBloggs: I don’t think anyone here is “trying to destroy the carbon market”. Like you said, the price of something is determined by supply and demand. The carbon market could “boom” but it is not going to have much effect on VERs held by private investors – they are very difficult, if not impossible to sell for a number of reasons ASIDE from the fact they are not worth very much. For one thing, there are lots of projects generating ample VER credits to meet all envisaged future demands. Why would a company wishing to offset their carbon footprint purchase their credits from a private investor when newer and cheaper credits are available? You also conveniently disregard the due dilligence process that a company has to go through when purchasing carbon credits – not just any project will do. You can add to this the fact that credits held by investors are typically far too small in number to be practical for offsetting.

    Finally, your post suggests that the opinions expressed on this website have an ideological motive for being “against” carbon trading and carbon credits. I don’t think this is true. There is a widely held consensus across the carbon trading industry, the police and the English judiciary that companies that have sold VERs as investments have done so fraudulently. Witness the number of companies liquidated by the Insolvency Service and the judges’ comments on each case.

  10. @BrokenArrow

    A lot of your points are true and I agree with, but I still fail to see how anything that is mentioned on this Blogg will actually ‘help’ the investors currently holding credits. So I have a number of points.

    First – the sale of VERs to retail investors is not fraudulent. This is a very key point to make. Mis-selling VERs to investors is fraud i.e. promising false returns, pressure sales etc. I do agree that there are a great number of instances of such mis-selling. However, many investors passed compliance (calls or signed agreements) where they were made FULLY aware of the risks associated, yet still agreed to go ahead: this is never documented or acknowledged.

    Second – when the registries first gave out accounts, such as CDC, it was perfectly acceptable to have credits held in nominee. So many used this as a mechanism to offer credits to investors as a high risk investment, increase purchasing power and attempt to increase return – something which is perfectly normal in many alternative investment classes.

    Third – when this system was perceived to be being abused, the registries moved this service. As such many investors are left in limbo, unable to facilitate sale or transfer, even if one was arranged.

    Fourth – if there was a platform, such as a CTX, where the retails investors where able to place there credits (project ID, vintage etc); they could be pooled together in a similar way to many other investments and they could at least entertain the POSSIBILITY of receiving even some money back from their investment. As individuals, it is almost impossible – if a platform was present it would at least be possible. At the moment, the registries categorically will not allow anything of the sort to exist.

    Fifth – the cap and trade scheme in South Africa includes VCS credits (VERs), thus it is possible that other schemes across the globe may well use the same model.

  11. @JoeBloggs:

    Well, I don’t think anyone would have invested if VERs were accurately described by those selling them: not intended for investment purposes, difficult, if not impossible to sell, credits sourced typically from ten-a-penny hydro projects marked up at 4-5 times the original cost, subject to a long process of compliance and due dilligence when purchased by companies for offsetting, a wasting asset falling in value over time, NO forseeable significant increases in demand or value by industry experts, no current evidence of ANY private investor selling on, never mind making a profit. It is true though that people didn’t read the small print and are now kicking themselves, and should of course bear this responsibility – but I guess that’s why we call this kind of thing a “scam” as opposed to just “theft”: people have been tricked into buying them.

    For this reason I don’t really blame the registries for stopping the use of nominee accounts when it became apparent that they were being used for scamming purposes.

    Opening them up again would add legitimacy to the idea that these things are investment products and would probably lead to even more opportunities for recovery rooms which I am sure the scammers would fully exploit. I’m not sure why you think anyone has a responsibility to help those who have been caught up in this mess, other than the relevant authorities responsible for investigating fraud. False hopes help no one except the scammers.

  12. It is accepted by all that the overwhelming majority of VERs sold as investments were indeed missold (fraudulent misrepresentation). Despite their promises the brokers had no business contacts to ‘exit’ investors and had no intention of ever attempting to do so. We would all like to see these people prosecuted for their criminal activity and whatever monies that could be recovered distributed to the victims.

    Nevertheless, putting that to one side, it is clear that VERs continue to be legitimately issued and that a substantial number of large companies purchase and retire voluntary credits for carbon offsetting However, very little reliable information is available about price paid, choice of project etc.

    We are generally told that the vintage and type of project from which credits have been sold to investors would be of no interest to companies that buy for retirement and are the cheapest around. What is the evidence to support this? Lets say that for PR purposes a company has chosen a project from which to purchase credits for retirement. Does it really care about the vintage (year) in which these credits were created? For what possible reason if they are from the same project?

    Then there is the choice of project. If this were so important for PR purposes why do companies not widely publicise this information? I have no idea (nor can I find) details of any project that a company has bought credits from, so what PR value can that choice have? It is argued that such companies engage in substantial due diligence in such decisions. Yet the projects that have issued carbon credits have already been through substantial due diligence to enable them to issue credits on (say) VCS registry.

    We certainly don’t want anyone to appear to legitimise the mis-selling of carbon credits as investments, but it also strikes me that the registries have a duty of care towards those who have bought them to make their sale and transfer possible. They can’t play Pontius Pilate and wash their hands of the matter.

  13. @Mike – Thanks for this. One problem with your argument is that companies can buy CERs on the EU Emissions Trading System for €0.10 (31 October 2014). If the company isn’t bothered about the PR, why would they choose to pay more?

  14. I agree its a mystery. So why can’t I find any company that publicises the projects they have bought into. There no Public Relations benefit if the Public don’t know (and can’t even find out)!

  15. @mike I think you aren’t understanding the concept of a ‘high risk’ investment. If you went into an art gallery and the salesman tried to sell you a painting, stating ‘the artist is really talented and his work is going to be worth a fortune in a few years’ and you then buy the painting without doing your own research then thats your fault; and everyone would agree. People make bad decisions and like to believe they are going to win the lottery, literally and metaphorically. They also like to blame others when they make bad decisions. The point I was making is it actually impossible for anyone currently holding credits to facilitate sales, even if a buyer was arranged and willing as the registries would not allow it.

    With reference to you PR claim about credits; 1 tonne of CO2e is equivalent to 1 tonne CO2e, why does the offset have to be for PR purposes? Some companies may simply want to ensure they are negating some of their business footprint as it falls in line with their belief in tackling climate change; if that were the case then cost is the most important factor. It would make sense for involvement in projects to reflect business activities.

    @chrislang You state the current CER price and suggest that is the price you pay. To set up a trading account with a bank for CERs, many of them require you have $50million on your balance sheet, so its not just as simple as buying a few CERs. You can’t go into Beaverbrooks when buying a gold ring, weight it and then complain when you aren’t paying the daily spot price for gold.

    An interesting question for you Chris Lang, which I’m almost 100% sure you won’t answer; or if you do you will answer as if you were a politician. If CERs are currently at €0,10; a few months ago they were €0,30; a few years ago they were €6,00. Major nations in the EU are looking to wipe out lots of the banked credits to stimulate the EUETS. If I usually invest around £1,000,000 per annum, do you think it could be worth buying say £1000 (1%) CERs as a high risk/high yield play?

  16. @Joe Bloggs – Sure, if you’ve got a million pounds to invest every year, why not put 0.1% in CERs? (1% of 1,000,000 is 10,000, not 1,000.) The price can’t drop much lower than €0.10, can it? The worst that can happen is that you might lose £1,000. But I’m sure you could find better things to invest in, without too much effort.

    In any case, you know as well as I do that the scammers selling carbon credits as investments were not selling to people with £1,000,000 per annum to invest. They were (and are) cold calling people and taking their life savings for something that was never supposed to be an investment.

  17. @Joe Bloggs. I understand the concept of a high risk investment. But also (as you have pointed out) I don’t care if something was ‘never supposed to be an investment’. Gold, Wine, Art, even property; were these ‘supposed to be an investment’? Anything that is perceived to have value can be seen as a potential investment.

    My point is that Carbon credits were not sold as the extremely high risk, speculative investment that they were/are. In most cases they were sold with a verbal guarantee/assurance of a high return in the short/medium term. This is why people put their life savings in. This is fraud.

    And companies do not buy carbon credits ‘as it falls in line with their belief in tackling climate change’. A Company cannot have a ‘belief’ only people can have ‘beliefs’. A company exists for the benefit of its shareholders (owners). The purchasing of credits to offset carbon footprint can only exist for PR purposes. You buy our product and we will use some of our profits to ‘help the environment’. That’s the economic deal.

  18. @ChrisLang

    First thanks for being honest with reference to CER investment and second for correcting my mathematical error.

    The problem with a lot of what you say and report is; it is one sided. VERs are unregulated and thus I agree they were never ‘intended’ to be an investment product; but neither are cars, art, clothes, antiques etc. Yet people still invest in them.

    If they were never intended to be investment products then why did certain pension providers allow VERs to be included in pension plans? Why did the registries allow nominee accounts to be set up?

    Your final sentence is just purely speculative, you have no evidence of each and every person’s % investment of their ‘life savings’. No-one does. So why say it?

    The world’s major banks have been fined billions of dollars over the past few years for repeatedly ripping people off. That doesn’t mean everyone who works in finance is a fraudster. Yet technically everyone who has exchanged currency over the last few years in London has been the victim of fraud. Who do you think has made/lost more money?

    The only solution to this problem is for registries to allow a secondary market which can be regulated, which should have happened in the beginning.

  19. Whilst your article RE ‘carbon expert’ was informative and he is obviously a very knowledgeable man with reference to the carbon market; the analogy with eBay is interesting as in the UK alone the Mail claims there around around 2000 eBay millionaires.

    So in fact people do buy things on eBay and then sell them the next day; some people make a lot of money doing it.

  20. @Joe Bloggs: In his presentation Andy Ager says registries are “similar in operation to eBay” which only describes the mechanism by which carbon brokers advertise credits to companies wishing to offset. This in no way implies the existence of a secondary market, because there isn’t one and never will be. You can’t just artificially create a market for something because someone is desperate to sell it: there has to be a demand for it. This is why lobbying the registries is irrelevant.

  21. @Mike As much as I would enjoy the semantic and philosophical debate as to whether companies have ‘beliefs’, I don’t really see the relevance. Many companies are interested to improve their Sustainability Index against various metrics, carbon offsetting will thus be placed into a table in an annual report showing the net reduction in overall footprint. If you look into something like London 2012, you will find the projects involved.

    With reference to the mis-selling; if there evidence of parties offering guaranteed profit, then I agree 100% the respective parties should face the full extent of the law.

    @BrokenArrow I don’t think you can make a claim such that there will ‘never’ be a secondary market. The principles of supply and demand are dynamic and are thus impossible to predict. Though I agree at this current time and maybe for a few years, the abuse of the voluntary market means the registries will not dare allow a secondary market.

  22. @chrislang The point I originally made, which still hasn’t been answered is; do blogs such as this which create negative publicity surrounding make it more or less likely for a secondary market?

    The answer has to be ‘less likely’. So who is benefiting?

  23. @Joe Bloggs: You can use the “unable to predict future demand” about anything though. For example, you could say that, in the near future the EU will ban the sale of brand new tin openers because they could be classed as dangerous weapons. Therefore they are now an investment opportunity so buy them up, they will double in price in the next eighteen months. That scenario in theory could happen, but its not very likely is it? Similarly for carbon credits.

  24. @BrokenArrow I’m not taking about the price increasing, I’m suggesting there is a chance of a secondary market as there is a need for one. That it much more likely than a dramatic price increase.

    However all the negative press, from blogs such as this, give the registries a headache. If such things continue a secondary market will remain unlikely.

  25. @Joe Bloggs. We are agreed that whether to improve their Sustainability Index and/or for purely perception (perhaps cynical) purposes to show they ‘care for the environment’ companies do buy VERs. I remain unconvinced that the choice of project or vintage is as critical as we are led to believe as I have seen little evidence of what is purported to drive this.

    I am also unconcerned over the theoretical argument about whether carbon credits were ever ‘meant to be an investment’ for the reasons articulated. They are, after all SIPP approved! The key issue is that the overwhelming majority were sold through fraudulent mis-representation and that is criminal activity.

    Blogs such as this have done an excellent job in highlighting the level of this fraud and bringing people together to share views and actions. It I frankly disgraceful that with so much evidence the authorities have done so little to bring the criminals to justice.

    The next question is surely along the lines of: What can now be done to help the victims of the fraud? You argue that the continuing negative press generated by these blogs actually hinders the creation of a secondary market and perhaps the chances of the victims ever being able to recover any of their investments. There is merit to that argument. But if @Chris Lang does not believe in the Carbon Market as a concept what role do you expect him to perform?

  26. @Mike I would prefer if this blog would even suggest a secondary market.

    With reference to your other points you make a number of bold claims. Surely this issue is whether or not these firms did mis-sell fraudulently, if there is hard evidence of this then I’m sure the relevant parties will be prosecuted. However, the people who completed compliance documentation successfully, for example those who placed credits into their SIPPs; by law would been made fully aware of the risks and will have signed disclaimers stating that fact. So the argument is not a black and white as you make out.

  27. @Joe Bloggs. I would also like a secondary market to be encouraged.

    With regard to fraud I have been involved with large numbers of people who have be mis-sold. Victims have been interviewed, documentation provided, witness statements completed. The evidence is overwhelming.

    The Police/CPS do not prosecute because resources are allocated elsewhere – like all public services its a matter of priority, will and perception.

    With regards to compliance documentation, if a person is persuaded to make an investment through aggressive sales tactics, supported by knowingly false statements, being transferred to the ‘compliance department’ to answer some questions and sign a form containing ‘small print’ about the risks does NOT exonerate the company. IT IS STILL FRAUDULENT MIS-REPRESENTATION AND IT IS STILL A CRIME. Legislation such as the UNFCC make this clear.

  28. @Joe Bloggs:

    At the risk of repeating myself: A secondary market isn’t just a case of wishing one into existence, there has to be a demand for the products you wish to sell. There is no demand for VERs held by private investors for the reasons that I listed above. If you really want a secondary market maybe you should lobby companies wishing to offset their emissions to buy (comparatively) expensive credits from people who were conned into buying them. I don’t think that approach is going to wash somehow.

    You could probably argue all day about whether a particular commodity could be a suitable as an investment or not. In the case of wine, fine art, diamonds, vintage cars etc – which you should remember have attracted their fair share of scammers in the last few years – at least these have some “secondary” purpose or value, e.g. if your investment in a vintage car doesn’t work out, at least you can still take it for a drive on a Sunday. Carbon credits are an ENTIRELY artificial product and their intended purpose and design is: for companies to purchase from projects through a broker for the purpose of offsetting carbon emissions, no other economic reason. The fact that VERs were eligible to be held as part of a SIPP is not an endorsement of them as a suitable investment but stems from their tax status which is controlled by HMRC. It is down to the individual SIPP provider as to which products are allowable in a SIPP or not, NOT the government or HMRC. SIPPs were specifically created to allow investment in anything subject to approval by the SIPP provider.

    The fact is that most of the firms selling VERs as investments had “SIPP approved” spashed over websites and brochures which is suggestive of government approval but is not the case. I consider this to be a loophole which the scammers have fully exploited.

    As for the selling of VERs as investments, I think it has been pretty firmly established by the Insolvency Service and Action Fraud that firms doing so have been doing so fraudulently. You say that people buying were “made fully aware of the risks” – I don’t think this is the case, because if they were accurately described then I don’t think that anyone would have bought them. There aren’t any risks to weigh up, really: these things were NEVER envisaged to be a suitable investment by ANYONE in this industry. If they were, don’t you think one of the big investment banks, or suchlike, would have, at some point, been buying up VERs as a potential high risk investment? There is no evidence of this happening.

    It is easy to come to the conclusion that ALL VERs sold as investments were sold fraudulently. Seems pretty black and white to me.

  29. @ Broken Arrow

    There can never be a demand for something if it doesn’t exist. There was no demand for an iPod before apple brought it out.

    If there was a platform where individual investors could place their credits (after going through strict due diligence), those who held real and verifiable credits have the ‘potential’ to sell them. Brokers could buy them, companies could buy them etc etc.

    You say there has been no investment into the Voluntary Carbon Market from financial institutions. This is simply incorrect. Where do you think the funding comes from in the first place to set up emissions reduction projects? Banks such as ING, Nedbank and the World Bank have invested heavily in the voluntary carbon market. The distinction you need to make is between institutional investors and retail investors. Institutional investors have been buying and trading VERs for a long time – these transactions are not fraudulent.

    You make so many assumptions which are not based on facts. If people were actually made aware of the chance of winning the lottery, and were fully competent with mathematics then NO ONE would play the lottery; yet millions do. Most people ‘actually’ dont’t need to get involved in 3 for 2 offers at supermarkets; but they do and supermarkets make millions in wasted food each year. If people were educated they would know that a retail ‘sale’ cannot occur unless the discount is greater than 30%; put people think they are getting a good deal. Popcorn at cinemas in the UK is marked up at up to 12,000%. Pay-day-loans companies have made billions from charging people extortionate levels of charges and interest. People make foolish decisions all the time. The problem is most people did not fully understand and made bad decisions.

  30. Mr Lang
    I find it dispicable that you have been using your website not only to attract donations but also to then get investors to invest in your own dodgey schemes. It is a fantastic cover to use your site to discuss the imperfections/scams run by others putting yourself out as the authority only to ask money for your own forestry investments.

    I can see why you are based in Indonesia, that is where other people with the same business ‘model’ live. I have reported you to the FCA.

    I would expect you to remove this post as the gate keeper to your site. But dont worry all your readers will be well aware of your scams once I have finished with you.

    How dare you take my money then refuse to take any of my calls and no doubt spend the money on small boys in Indonesia.

    You and your site needs to be shut down.

    This is the start.

  31. @JoeBloggs: I am not talking about large companies and corporations funding offset projects, or trading large volumes of credits for various reasons. I am referring to “investing” in the traditional sense: buying something and holding with the purpose of selling later at a profit due to an envisaged increase in value. This is how VERs were sold to private investors.

    With regard to the examples you gave – OK so people make poor decisions and have all sorts of biases. I think most people grasp the idea that the chances of winning the lottery is vanishingly small but probably play anyway for lots of other reasons: the excitement of watching the draw, fantasising about winning, etc. These kinds of things are difficult to put a “value” on so it isn’t just down to probability. Most people probably get that popcorn sold at cinemas is extortionately priced but tend to buy it anyway. So what? You know what you are getting. Payday loans are probably a bit more of a grey area – and have been widely criticised as ethically dubious – but these examples are different to fraudulent misrepresentation in my opinion. If people knew the credits they were buying were being marked up 5 – 10 x the price they were sourced for, were never likely to go up in value, and difficult if not impossible to sell then I don’t think they would have bought them.

  32. @BrokenArrow
    When sales to retail investors first became prevalent the market should have became more transparent and more regulated. Now it needs a secondary market instead of heads being buried in the sand.

    With reference to this blog, with reference to the retail investors the whole negative press in becoming counterproductive.

    And in terms of the bigger picture – UK and US banks were just fined billions for being fraudulent, with reference to FX. Starbucks, Amazon et al have paid almost £0 tax in the UK in the last decade. There are probably more pressing issues our capitalist world to blog about and attempt to undermine that a system set up to try and help the non-annex 1 countries develop in an environmentally sustainable way. This is my issue with Mr Lang.

  33. @BrokenArrow @Mike @ChrisLang

    It would also be interesting if we actually looked into what the registries stated about the Voluntary Carbon Market before the change of stance with reference to retail investors. I have already stated that in the past, the registries allowed nominee accounts for clients to ‘hold’ credits.

    Lets look at APX from 2008:

    “No matter the business or type of market participant – project developer, corporation, bank, broker, investor or verifier – market integrity and security are essential to ensure the continued dramatic growth of VCU transactions and the voluntary carbon markets.”

    – ‘……broker and investor’ is this not suggesting a retail investment market?
    -there are no limitation placed on who VCUs are open to, the exact opposite in fact.

    “The Registry creates trusted and tradable voluntary offset credits…… provides public access to approved VCS projects and is fully integrated with the VCS Project Database.”

    -‘tradable’ VCUs with public access.

    Who where is the secondary market for the tradable VCUs purchased by investors?

  34. @Joe Bloggs: Misleading. I don’t think they are referring to investors with the same meaning that you imply. If you visit their website today, on the first page it quite clearly states that “APX strongly believes that VCUs are not an appropriate investment vehicles for individual investors”. Follow the link and you will see that they still refer to “investors” participating in the VCU market:

    “Unlike instruments approved for use in compulsory carbon cap and trade programs, no entities are required to purchase and retire voluntary carbon offsets. Entities that voluntarily seek to offset their GHG emissions footprint (such as corporations, governments and individuals), project developers, traders and investors are active participants in the VCU market. Therefore, there is little ability to accurately forecast demand and supply in the voluntary carbon offset space. As a result, APX strongly believes that VCUs are not suited for individuals to target as a short, medium or long-term investment.”

  35. @Broken Arrow

    How is anything I have said misleading?

    The points I made were:

    – the registries at one stage had registry accounts and now they don’t : FACT
    – in 2008 the APX website clearly states “No matter the business or type of market participant”, states the word “investor”, does not distinguish between retail and institutional investors and states the registry has “fully tradeable” VCUs – FACT
    – the registries current stance has been changed due to mis-selling – FACT
    – the registries are refusing to allow a secondary market to facilitate any sort or sale or transfer for retail investors – FACT

  36. *** -the registries at one stage allowed nominee accounts and now they don’t -FACT

  37. Regardless of whether carbon credits were meant to be investments or whether they were over-priced the overwhelming majority sold to individuals were done so fraudulently. I can’t see how this can be in dispute.

    The fact that they allowed in a SIPP also gave a level of credence to the fraudsters. Government legislation controls what can be held within a SIPP and it is up to the SIPP provider to decide which investment types they wish to allow in their offerings.

    The registries ‘allowed’ individuals to hold credits to the extent that they allowed sub-accounts to be set up in individual names. When they spotted this and became aware of the potential mis-selling involved they put a stop to it by closing or freezing the accounts involved. The warnings about credits not being suitable for private individuals to hols as investments only came after the scale was apparent.

    In theory there is nothing wrong/illegal about ones credits being held in a ‘bulk’ account on the registries. This is how the majority of shares held by individuals on the stock market are recorded – through the Brokers CREST account. But it requires the broker to hold a breakdown of the bulk holding separately.

    Of course most of the carbon credit brokers probably didn’t do this, and as they have mainly gone bust there is no transparent record of who owns what. The registries must take some responsibility for this and should make it possible for individuals to identify and trade the credits they own. Instead they are just washing their hands of the problem.

    The negative press associated with carbon credits is almost certainly counter-productive to the creation of a secondary market and/or to individuals to hold them ever being able to sell them. But Chris Lang is not motivated to that end.

    So if this is what you want to promote why not set up your own blog to promote it. I’m sure you would get lots of interest from private investors.

  38. @Joe Bloggs:

    The web archive you are refering to is from 2008, at a time when the APX registry was not officially open for project registration (“the APX VCS registry is not open for registration and can not issue VCUs until early October”). Much has changed since then, not least the many millions lost by private investors tricked into buying VERs by boiler rooms.

    The fact that registries once allowed sub accounts in the name of individuals rather than companies does not necessarily imply the intention to create a secondary market. It may be for the purpose of allowing individuals as well as corporations to retire credits to achieve “carbon neutrality”.

    The use the word investor does not necessarily mean “private investor”. Corporations also “invest” in projects that generate VERs for their own offsetting purposes for example. This is not “investment” in VERs with the intention of speculative purchase, holding and selling, and no mention is made of “retail” investors. As I said in my previous post, the current APX website still uses the word “investor” but advises twice that “APX strongly believes that VCUs are not an appropriate investment vehicles for individual investors” and “APX strongly believes that VCUs are not suited for individuals to target as a short, medium or long-term investment.”

    In any case, as regards reasons why there isn’t a secondary market for VERs, all this is irrelevant. When in doubt, refer to the experts. The link Chris gives above is a transcript of a talk that a former carbon trader, Andy Ager gave to the City of London Police Fraud department. Some quotes:

    “Genuine buyers of voluntary carbon credits….will not buy from private individuals, because it is a long process for a large corporation that decides to offset their emissions to actually go out and go through the process of picking a particular project that its looking for, carrying out the due diligence. There are a lot of legal terms, indemnities etc., that need to be signed.”

    “So you can understand that there is a significant risk when investing in carbon offsets for a company’s compliance whether it be part of the regulated scheme or whether it be voluntarily. No company wants to do the right thing and offset their emissions and suddenly find out that they have an absolute and utter PR nightmare. That they’ve invested in credits that have problems or issues with them that could cause damage to the company. It is not a question of just phoning up and buying voluntary credits of off somebody, it takes a long process.”

    “It takes a long time to negotiate these types of trades, as mentioned, when large corporations are buying these certificates there’s a lot of due diligence, a lot of work, a lot of documentation, a lot of legal to go through.”

    “You would only buy voluntary carbon credits to offset your carbon foot print. There is no other economic reason.”

    “Genuine buyers of voluntary carbon credits will only deal with reputable and recognised sellers. There are probably a dozen or more recognised, industry recognised companies that have an exposure or involvement in the voluntary market. Genuine buyers will only buy from them.”

    “These registries are really for the consumer to buy, to purchase and to retire. To consume those credits. So if a company has gone through the process of doing its due diligence and has decided to offset its carbon emissions, it chooses, browses through one of these registries, chooses a voluntary carbon credit, buys it and then retires it.”

  39. @Broken Arrow

    Much of what you have said is superfluous and in face adds further strength to my argument. At its inception the voluntary carbon market was not sure of the actual direction it would take and I agree the market was abused by brokers trying to make money; the registries are partly to blame. The fact that they have actually changed their position and clarified things further confirms this.

    I don’t know your level of involvement or knowledge in the carbon market, but Andy Ager, whilst obviously being very knowledgeable about certain aspects of the market had an agenda when he gave his ‘talk’ or ‘presentation’.

    This comment for example is just unsubstantiated nonsense, “Genuine buyers of voluntary carbon credits….will not buy from private individuals, because it is a long process for a large corporation that decides to offset their emissions to actually go out and go through the process of picking a particular project that its looking for, carrying out the due diligence.”

    Who are ‘genuine buyers’? They WILL NOT buy from private investors, what evidence is there of this? They HAVE NOT bought this is true, but there is no option to, so how can you make a statement that the WILL NOT when this has not been tested?

    There are many opportunities out there to provide retail investors with exits from their holdings. Granted they will most likely take a massive hit on what they paid – but it is 100% possible. The market is set up such that 1 VCU = 1 VCU in terms of environmental impact. So has long as the credits held are real, then theoretically there is 0 reason why they couldn’t be used to offset.

    The whole ‘due diligence’ thing is also nonsense. If the credits purchased by retail investors are real, their history will be tracked all the way to verification, validation and registration. They will be held on a registry account, in exactly the same way as every other VCU. It is a mathematical certainty that some retail investors will be holding VCUs from projects, with the same vintages, that have been used for offsetting. So why can this not happen again?

    1. The registries won’t allow it.
    2. Companies are greedy and know they can buy credits direct from developers than from individual investors.
    3. There is so much negative press attached to this area that companies would be too scared to go anywhere near the credits held by retail investors.

  40. @Broken Arrow

    Another concept from the wise Andy Ager statement which is also nonsense.

    “Genuine buyers of voluntary carbon credits….will not buy from private individuals” – we will analyse the ‘private individuals’ concept.

    Private individuals cannot get a registry account, therefore they cannot themselves hold credits. Any holdings they do have, presuming they are real and actual, will be held in a registry account in the name of the account holder – a corporate entity. Thus, any retirement transactions would be between two corporate entities, NOT private individuals. The private individuals would never be principle on the transaction and the ‘genuine buyer’ (whatever that is) would never buy from the private individual anyway.

  41. @Joe Bloggs: Well, likewise I don’t know how you are involved in the carbon market but your allegation that Andy Ager “has an agenda” is unsubstantiated. In fact, I would suggest that if anything, some of the points you are making is suggestive of yourself “having an agenda”. What Andy is saying is widely echoed by experts across the industry, as well as Action Fraud, the City of London Police, the Insolvency Service, the Financial Conduct Authority and numerous Judges who have been involved in winding up companies selling carbon credits as investments. I think I will take the word of this general consensus rather than the opinion of an anonymous poster on a website whose stated opinions are not backed up by any substantial evidence (writing “FACT” in capital letters does not enhance any of the points you make by the way).

  42. @ Broken Arrow

    I agree my comment on Ager was unsubstantiated, however I was making an inference based on the fact that the presentation contained lots of statements which were either irrelevant or inaccurate.

    You have chosen to ignore my main points and focus on comments which are less important – but capable of being questioned. The problem you are faced with it that my points are valid.

    I think my agenda is quite clear – a secondary market could be created, blogs like this which promote negativity of the market do not help the situation.

  43. @ Broken Arrow

    The more I read Ager’s comments then more hilarious I find it; he is the ‘carbon expert’.

    “There are probably a dozen or more recognised, industry recognised companies that have an exposure or involvement in the voluntary market.” That is just absolute nonsense.

    There are two registries for VCUs, APX and Markit. Looking into APX alone they have:
    417 Project Proponent Accounts
    97 General Accounts
    27 Retail Accounts

    The whole premise of the market and the registries is that each of these, whilst being able to facilitate different aspects of the market, are involved in the market. And each of the account types are equivalent.

    So the ‘dozen or so’ comment is simply false.

  44. @Joe Bloggs:

    Like I said, I think I will trust the word of recognised experts rather than the bull that you are spouting. Good day

  45. @Joe Bloggs:

    My previous comment was a reply to your earlier one, it must have been stuck in moderation. But I wanted to reply to your subsequent post.

    Regarding the number of companies involved in the voluntary market, the presentation is from around 2012 so the number of companies registered on APX may well have changed since then. The number of accounts on the registry also does not necessarily reflect the number of active market players, and in any case does not invalidate Ager’s opinion that genuine buyers will only deal with genuine suppliers of credits not private individuals – and yes, in the sense of private individuals holding credits through a “holding” company. Corporate buyers will still be interested in the source of these credits – project type, location, direct evidence of beneficial environmental effects. Despite what you say, a credit is not just a credit – 1 VCU represents the “right” to emit one tonne of carbon dioxide but this does not necessarily means equal environmental impact between different types of VCU. cookstove projects have very different impacts on local communities when compared to hydro projects, for example – and this matters to clients as it is for PR purposes. The presentation makes this clear, and is supported by a general consensus across the industry – check out the websites of any of the companies registered to supply credits on APX. These suppliers are mostly in the business of supplying good quality, traceable credits to companies and entities wishing to offset their carbon emissions. I can’t see why a company would go through the process of calculating a carbon offset and then agree to purchase credits from multiple projects from cheap sources (as the credits sold by boiler rooms mostly were). Logically it just seems like too much hassle when it would be much easier to buy newer credits from trusted suppliers or direct from the projects (and why would companies be “greedy” to cut out the middleman go direct in this way, as you suggest?).

    The role of the registries in all this is to simply facilitate projects, brokers and buyers to meet the objective of providing a trusted means of companies to offset. It is not in their interests to provide a platform for a secondary market and nothing you have said backs up the case that it is the registries holding back the creation of a secondary market (not lack of demand).

  46. @ Broken Arrow

    Thanks for taking the time to write an intelligent response. I will attempt to answer the best I can.

    One of the main issues with the market is its relative complication. Earlier we briefly discussed roles and involvement in the market, I would not call myself an expert, but it is possible others would.

    I will attempt to go through your points and offer an alternative view where appropriate.

    Your first point is a little petty, Ager either doesn’t know how many people there are involved in the market, or he personally only deals with ‘a dozen or so’. In 2012 there where hundreds are suppliers as their are now. So he is simply factually incorrect. Conclusion from that being, his word is not gospel and shouldn’t be treated as such.

    It is fairly obvious from the evidence I provided his statement is inaccurate, so would be useful if you would simply accept it.

    I think we need to get into the ‘source of the credits’. Before we go into this we need to base this on the premise that the credits held by retail investors are real VCUs verified by VCS, held in a registry account.

    When a carbon project is created, it needs to fulfil criteria set out in the relevant methodology. These are generally created by the UNFCCC, but VCS have created a few methodologies of their own. Lets take a Wind Project in India. The project believes it has justified the criteria, a 3rd party assess the project, lets say it passes the verification and validation. The project goes through VCS and issues x credits (carbon offsets). These are then held on a registry.

    If we do down the offsetting route, ‘corporate entities’ generally go through a carbon offsetting provider, these companies sources credits, relevant to the needs and demands of the client and retire them as and when needed.

    When companies select credits, it would be very usual for them to ask for a history of which registry accounts the credits have been held in. Why would they do that? They don’t essentially.

    So Mr Joe Bloggs’ credits (private investor), again let us presume the credits are real and held in the registry account. They are ‘exactly’ the same credits as the credits from the same project, same vintage, held in other registry accounts. I use the word ‘exactly’ in the most literal sense. Thus, theoretically there is no reason whatsoever why those credits could not be used to offset.

    A point I made in a earlier post, which seems to have been overlooked, but could potentially aid convey this idea – it is a mathematical certainty that some credits being held by ‘private investors’ will be ‘exactly’ the same as credits which have been used by corporate entities for retirement.

    Lets now look at the ‘corporate buyer’. I agree that the environmental, social and economic benefits of the local communities are different for different projects. But in terms of offsetting a carbon footprint 1 VCU=1 VCU. When companies chose to offset they are most commonly buying what is called a ‘carbon offset bundle’. All the major retailers do this; why? To maximise profits. Yes, large scale hydro projects are cheeper that a forestry project in the main. Often these, less expensive projects make up the bulk of the offset, yet it still includes a percentage of the more exotic projects; for PR purposes.

    Other factors you aren’t taking into consideration are geographies. Some corporate entities simply want a project in a specific country, as that is where they do business. The project type may be less important. Point being, each situation is different, so it makes no sense to presume otherwise. Mr Ager doesn’t really highlight this.

    With reference to the ‘middle man’ comment, I’m not sure I follow your logic. However, I hope I don’t have to explain the role of ‘middle men’ in global economics – its whole foundation is built on ‘middle men’. When I want some milk, I could go to the farmer, but I go to a shop because it’s easier and I pay for the privilege. Retail carbon offsetting companies are essentially brokers, which environmental expertise. Companies use them, as they don’t have the expertise in their own companies or knowledge of the market, less purchasing power etc etc.

    With reference to this point “I can’t see why a company would go through the process of calculating a carbon offset and then agree to purchase credits from multiple projects from cheap sources (as the credits sold by boiler rooms mostly were).” I hope you can now see that this is precisely what they do; via a carbon offsetting company, in a ‘carbon offset bundle’. Well other than calculating a carbon footprint, instead of an offset.

    With reference to you last point, first there already is a secondary market for entities involved in the industry. CTX is a platform where credits are traded; but the trading of credits from ‘private investors’ is not allowed. Second the registries would not have to provide a platform, but they would have to sanction it.

  47. I realise I have made a number of mistakes, typing quickly, most are not significant; however.

    ‘When companies select credits, it would be very usual for them to ask for a history of which registry accounts the credits have been held in. Why would they do that? They don’t essentially.’

    This should be ‘unusual’.

    A final point which has not been touched upon relates the cost relative cost to the end buyer; the corporate entity. I touch on ‘carbon offsetting bundles’ but I have omitted a key reason for their existence; cost of offsetting to the corporate buyer.

    Lets presume a corporate entity wants to offset 10k tonnes. They are also interested in a forestry project in Uganda say, but these credits may be $5 each. The company does not have a budget of $50k, lets say they have a budget of $30k. So the retirement will be comprised of less expensive credits, from say a large scale hydro project (7.5k tonnes @ $2) and some from the forestry project (2.5k tonnes @5); now costing $27.5k within budget.

  48. @Broken Arrow @Joe Bloggs
    Whilst there is validity in the arguments you both raise, you seem intent on picking holes in minor points to justify discrediting the whole.

    Andrew Ager is an authority in this area, but while the overall substance of his commentary is correct, it does not mean that each and every sentence can be taken as the gospel truth.

    The reason why companies would not buy credits from private individuals has nothing to do with the projects they hold, it is because they don’t want to deal with a bunch of individuals to put together the package of credits they want. This is what they employ a Broker for. And the Brokers can more easily arrange such a package without needing access to individual’s holdings.

    A proper secondary market and registry transparency would clearly facilitate this, but as things stand its not in anyone’s interest (apart from the individuals) to make this happen.

  49. This is a message from the Official Receiver.
    On 4 March 2015 a winding up order was made in the High Court against the company Eco Business Management Ltd. The petition to wind up the company was presented in the public interest, after an investigation under section 447 of the Companies Act 1985.
    The company is being dealt with by the Official Receiver at Public Interest Unit (South), 4 Abbey Orchard Street, London SW1P 2HT. If you believe that you are a creditor of Eco Business Management Ltd, please contact the Official Receiver via

  50. I have recently been contacted by companies claiming that they can obtain my funds that I paid for the carbon credits, naturally they want an up front fee. The latest one claimed to be Royal Capital and then gave the address of a company called Royal Asset management, which when I rang asking to speak to their carbon credits dept knew nothing of this. So the scam continues but this time they are claiming to be able to obtain your funds.