The former CEO of biofuel company American Bio-Fuels, based in Abbeville, Alabama, was arrested yesterday for selling illegal Renewable Identification Numbers (RINs). Arnesto, “Steve” Sobrado was charged with felony first-degree theft of property. American Bio-Fuels went out of business in June.
According to an article published by the Dothan Eagle, the charge was a result of a report made by an owner of American Bio-fuels in July that claimed Sobrado was selling illegal RINS to Paquin Energy & Fuel based in Keller, Texas. Sobrado allegedly sold $54, 915 worth of the fake RINS to Paquin Energy & Fuel in June and July.
RINs are 38-digit serial numbers assigned by biofuels producers to each gallon of fuel produced. They are used by the EPA to track that the gallons set forth in the Renewable Fuels Standard each year are met. This year, the mandate set the amount of biofuels to be blended at 11 billion gallons. Each RIN is priced on average at 10 cents, so more than $1 billion worth of RINs will be produced this year.
“We have the safeguards and controls in place to prevent fraudulent acts like this for producers,” says Clayton McMartin, President of CFCH and founder of the RINSTAR(r) renewable fuel registry. “Through our system, we can safeguard our clients from receiving fraudulent RINs because our due diligence enables us to discover and reject them. Serious companies need to prevent this fraud.”
According to the EPA website, they have yet to issue a violation and I have contacted the agency for comment.