Australian man pleads guilty in $41M fake-credit scheme

Source: Amanda Peterka, E&E reporter • Posted: Monday, July 28, 2014

An Australian man has pleaded guilty to a biodiesel fraud scheme that netted more than $41 million.

Nathan Stoliar, 64, last week pleaded guilty to five felonies for his role in the scheme, which involved generating fake renewable fuel credits in the United States for biodiesel that was never produced. Stoliar faces a maximum of 20 years in prison and hundreds of thousands of dollars in fines, according to the Justice Department.

In January, Stoliar and James Jariv, 63, of Las Vegas were indicted and charged with 57 counts of conspiracy, wire fraud, false statements under the Clean Air Act, obstruction of justice and conspiracy to engage in money laundering.

According to the indictment, Jariv and Stoliar claimed they produced biodiesel at a company called City Farm Biofuel and imported it to Las Vegas-based Global E Marketing. But the Justice Department says the two men actually sold “little to no” biodiesel to Global E Marketing and instead used the setup to generate $7 million worth of fake credits that refiners trade to comply with the renewable fuel standard.

The indictment also alleges that the men passed off some of the fuel, which did not have credits yet attached to it, as pure biodiesel produced at City Farm and sold it to U.S. entities at significantly higher prices than they otherwise would have been able to (E&ENews PM, Jan. 16).

Stoliar personally gained $7 million in the scheme, the Justice Department said. Last week, he pleaded guilty in federal court in Las Vegas to one count of conspiracy, one count of conspiracy to engage in money laundering, two counts of wire fraud and one count of making false statements under the Clean Air Act.

He is also required to forfeit $4 million and pay $1 million in restitution. The court has scheduled sentencing for Oct. 30.