Carbon credit scheme will draw organized crime: Interpol

Monday Jun 01, 2009

By The Edmonton Journal

Organized crime syndicates are eyeing the nascent forest carbon credit industry as a potentially lucrative new opportunity for fraud, an Interpol environmental crime official said on Friday.
Peter Younger, an environmental crimes specialist at the world's largest international police agency, was referring to a UN-backed scheme called "reducing emissions from deforestation and degradation." REDD aims to unlock potentially billions of dollars for developing countries that conserve and restore their forests. In return, they would earn carbon credits that can be sold for profit to developed nations that need to meet greenhouse gas emission reduction targets.
"If you are going to trade any commodity on the open market, you are creating a profit-and-loss situation. There will be fraudulent trading of carbon credits," he told Reuters in an interview at a forestry conference in Nusa Dua on the Indonesian island of Bali.
"In future, if you are running a factory and you desperately need credits to offset your emissions, there will be someone who can make that happen for you. Absolutely, organized crime will be involved."
Younger called on governments, multi-lateral bodies and NGOs to involve law enforcement agencies more in the development of REDD policies and in the fight against illegal logging and deforestation, which are responsible for about 20 per cent of mankind's greenhouse gas emissions.
"It struck me, as I sit here at this conference, as ironic that I am the only policeman here. You say you want to strike up partnerships to address illegal logging -- who with?" he said. "Consider resourcing law enforcement efforts and not just relying on NGOs and other nice people to do it for you."
Forests soak up vast amounts of carbon dioxide, and REDD aims to reward governments and local communities for every tonne of CO2 locked up by a forest over decades, equating to a potentially very large flow of cash globally for forest credits.
Local communities are supposed to earn a share of REDD credit sales to pay for better health, education and alternative livelihoods that entice them to protect rather than cut down surrounding forests. But revenue-sharing measures have yet to be worked out. Fraud could include claiming credits for forests that do not exist or were not protected, Younger said.