A bio-diesel fuel company owner was sentenced to 188 months in prison for crimes connected to an illegal fuels scheme and also fined $175,000 and ordered to pay nearly $55 million in restitution. Jeffrey Gunselman entered a guilty plea in December 2012 to an indictment charging 51 counts of wire fraud, 24 counts of money laundering and four counts of making false statements in violation of the Clean Air Act.
In what appears to be a badly run government program of renewable fuel tax credits, Jeffrey Gunselman, 30, the owner of Absolute Fuels was able to defraud the Environmental Protection Agency for more than a year by falsely representing that he was in the business of producing bio-diesel fuel.
Gunselman did not have a bio-diesel fuel-producing facility. Instead, Gunselman’s business operation consisted of falsely generating renewable fuel credits and selling them to oil companies and brokers. He instructed purchasers to wire payments to a bank account, and as a result, approximately $41,762,236 was deposited.
“Today’s sentence is the second significant penalty against an alleged bio-diesel producer who in fact produced no fuel at all,” claimed Cynthia Giles, assistant administrator for EPA’s Office of Enforcement and Compliance Assurance. (Read AutoInformed on Clean Green Fuel Owner Guilty in $9 Million in Bio-Diesel Scam)
Well, yes but… EPA didn’t discover this fraud. It was tipped off by a broker who was suspicious of the large amount of credits being sold. Who knows how many smaller or as yet undiscovered fraud schemes are going undetected?
From September 2010 to mid-October 2011, Gunselman conducted 51 fraudulent transactions, which were transmitted by wire communications, that represented to the EPA that bio-diesel fuel had been produced at the Absolute Fuels facility in Anton, Texas, when no bio-diesel fuel had been produced.
At the same time, Gunselman engaged in criminal transactions by purchasing real and personal property valued at approximately $12 million with the funds derived from the wire fraud. Included in that property are several vehicles, including a Bentley, Mercedes-Benz, Lexus, Cadillac and Shelby Cobra; a Patton Military Tank; a Gulfstream airplane, professional basketball season tickets and corporate sponsorship; and agricultural, business and residential real estate.
