Last week, REDD-Monitor wrote about the closure of 19 companies in the High Court in London. The companies sold more than 5 million carbon credits to retail investors, for more than £36 million. Hundreds of pensioners were duped out of their life savings.
One of the companies involved was CNI (UK) Ltd. Edward Carlton, CNI’s director, was previously “Head of UK Operations” at a company called Carbon Neutral Investments.
Until April 2013, Carbon Neutral Investments had provided services for a large number of boiler room operations that sold near-worthless carbon credits to retail investors, at hugely inflated prices. Carbon Neutral Investments also sold carbon credits to companies to make them “carbon neutral”.
In April 2013, Carbon Neutral Investments split into three companies: Gemmax Solutions (which continued to provide services for boiler rooms); CNI (UK) Ltd (which continued to sell carbon credits to companies); and Opus Capital (which got whatever was left of Carbon Neutral Investments).
CNI managed to strike deals with several companies, including two Formula 1 teams (Vodafone Maclaren Mercedes, and Sauber), What Car magazine, the Gumball motor rally, and Newcastle United. (There’s a list of CNI’s clients at the end of this post: “Carbon Neutral Investments and CNI (UK) Ltd“).
On Naked Capitalism, Richard Smith describes how CNI worked:
So there we are: on the one hand, schmoozing the rich and famous on the Formula 1 circuit, and on the other, providing custody, clearing and payment services (whatever those might be), to nasty little boiler rooms, while the FCA looks on and wrings its hands. Such is Carbon Neutral Investments.
Here’s part of the schmoozing side of CNI’s operations. Edward Carlton (director of CNI) is shaking hands with Alan Pardew, then-manager at Newcastle United. On Carlton’s left is Paul Seakens (director of Carbon Neutral Investments and Gemmax Solutions):
Thanks to CNI, Newcastle United became the world’s first “carbon positive” football club:
CNI’s offset program, following a detailed analysis of NUFC’s residual energy emissions, produced a detailed CO2e profile for the club and the club went beyond zero emissions by off-setting more carbon than the operation emits, and in doing so, becomes the world’s first football club to be truly ‘carbon positive’.
An energy consulting firm, GET Solutions, advised Newcastle United on reducing its greenhouse gas emissions. We don’t know how much Newcastle United paid for CNI’s carbon credits, or where the carbon credits came from. But we do know that by November 2013, Newcastle United was no longer listed as one of CNI’s clients.
Edward Carlton’s eloquent explanation of the deal with Newcastle United qualifies as the latest in REDD-Monitor’s “Carbonballs” series. It has been preserved for posterity in the form of a Newcastle United publicity video.
Here’s how Carlton explains the deal:
“It’s the first time any club has done this, er you know, so it’s a real kind of industry first and we want to be here to come and support, er, Newcastle in achieving this, er, really what we think is a great message.
“I think it’s massive, you know the Newcastle name is a strong name, er, for us at Carbon Neutral Investments and also the work that GET’s been doing the last few years, I think it’s testament to the fact that, you know, we like to align ourselves to a company with such a powerful name, er you know, it’s a strong club, it’s a club of, of heritage and pedigree and for us that’s what it’s all about, you know. We’re looking forward to the future, trying to build on, er you know, a green and a sustainable future and that’s what, kind of you know, I think we’re really laying the foundations to do here today.
“Clubs like this, floodlights, you know, the whole facilities, everything that goes on, a) has a huge electricity usage, but you know on top of that, that’s quite a large carbon footprint, and I think a lot of people take it for granted, erm, you know it’s not necessarily the most exciting thing on the tops of most people’s agenda, but more and more it’s getting pushed to the, er, to the front, you know we have the green Olympics this year, becoming carbon neutral, and you know, I think this is a, you know, a real sign of people who are pro-active, like the club, you know, sticking their heads up above the parapet and, you know, being willing to take that, that statement saying this is the right thing to do and, you know, here we are today.”