Las Vegas, NV – Alexander Jariv, 28, was sentenced to 30 months in federal prison on Friday, September 25, 2015, for his involvement in a multi-million dollar international biofuel fraud scheme. Jariv, of Las Vegas, Nevada, pleaded guilty to conspiracy to commit wire fraud, make false statements, and launder monetary instruments, bringing a close to a nearly four-year investigation by federal authorities.
The scheme, orchestrated with James Jariv, 64, and Nathan Stoliar, 64, of Australia, revolved around the manipulation of the Renewable Fuel Standard (RFS) program, created by the Energy Independence and Security Act of 2007. This program incentivizes the production and use of renewable fuels like biodiesel through the generation of Renewable Identification Numbers (RINs), which hold significant market value. The trio falsely claimed to produce and import millions of gallons of biodiesel through their companies, City Farm Biofuel (Canada) and Global E Marketing (GEM) based in Las Vegas, enabling them to generate and sell fraudulent RINs.
Investigators discovered that City Farm Biofuel never actually produced the biodiesel it claimed to, and that GEM was used to falsely report the blending of biodiesel with petroleum diesel, allowing the defendants to sell the RINs separately – essentially profiting from air credits for fuel that didn’t exist. The fraudulent activity extended beyond fabricated production numbers. James Jariv and Stoliar also purchased and resold lower-grade B-99 biodiesel as the higher-grade B-100, and illegally exported the B-99 without providing the legally required RINs to the U.S., effectively depriving the country of valuable renewable fuel credits.
“We simply will not tolerate and will vigorously prosecute schemes like this one, that defraud a program designed to strengthen our nation’s petroleum independence and improve our air quality,” stated Assistant Attorney General John C. Cruden of the Justice Department’s Environment and Natural Resources Division. The investigation, a collaborative effort between the EPA’s Criminal Investigation Division, the FBI, and other agencies, revealed a complex network of shell companies and foreign bank accounts used to launder the illicit proceeds.
Jariv’s sentence includes three years of supervised release and the forfeiture of $491,061 in seized cash, an SUV, real estate, and the contents of several bank accounts both domestically and internationally. He is the third member of the conspiracy to receive a prison sentence. James Jariv received a ten-year sentence and was ordered to pay $6,345,830.91 in restitution and forfeit between $4 to $6 million, while Nathan Stoliar received a two-year sentence and was ordered to pay over $1.4 million in restitution and forfeit $4 million.
Key Facts
- Defendant: Alexander Jariv, 28
- Location: Las Vegas, Nevada
- Statutes Violated: 18 U.S.C. 1956(h), 18 U.S.C. 371, 42 U.S.C. 7413(c)(2)(A), 18 U.S.C. 1343 (Clean Air Act violations, Conspiracy, Wire Fraud, Money Laundering)
- Sentence: 30 months imprisonment, 3 years supervised release, $491,061 forfeiture
- Restitution: $491,061
- Co-conspirators: James Jariv (10 years imprisonment), Nathan Stoliar (2 years imprisonment)
- Fraudulent Amount: Over $7 million in fraudulently generated RIN sales, over $34 million in missing RINs due to illegal exports.
Federal prosecutors emphasized the seriousness of the offense, highlighting the importance of protecting the integrity of the Renewable Fuel Standard and ensuring a fair market for legitimate biofuel producers. The case underscores the government’s commitment to pursuing and prosecuting those who attempt to exploit environmental programs for personal gain.
Source: EPA ECHO Enforcement Case Database
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