MONTVALE, N.J. -- A Montvale con man was sentenced to 20 years in prison Thursday for his role in an elaborate scheme to defraud biodiesel buyers.
Joseph Furando, 50, also was ordered by a federal judge in Indianapolis to pay more than $56 million in restitution. He also must surrender a Ferrari, other cars, a million-dollar home, artwork, a piano and two biodiesel powered motorcycles as part of a plea bargain.
“Programs like the Renewable Fuel Standard and the Blender’s Tax Credit open the path toward energy independence and curbing the impact of climate change,” said Assistant Attorney General John C. Cruden of the U.S. Justice Department’s Environment and Natural Resources Division. “When people approach these programs with bad faith and seek to exploit them, these purposes are blocked, American businesses are hurt and the treasury of the United States is depleted."
Biodiesel is a fuel that can be used in diesel engines and is made from renewable resources, including soybean oil and waste grease from restaurants.
Under the Energy Independence and Security Act, properly manufactured biodiesel was eligible for a dollar-per-gallon tax credit, as well as a Renewable Identification Number that petroleum refiners and importers could use to demonstrate compliance with federal renewable fuel obligations.
Furando admitted that sometime in late 2009, he and his companies -- New Jersey-based defendants Caravan Trading Company and CIMA Green -- began supplying E‑biofuels with biodiesel that was actually made by other companies and had already been used to claim tax credits, he said.
Furando "supplied the product to E‑biofuels and his co-conspirators would claim that E-biofuels made the fuel and then they would illegally re-certify the fuel and sell it at the much higher market price for incentivized biodiesel, known as B100, with RINs," Cruden said.
Within "the circle of those he trusted," he said, Furando dubbed the scheme “Alchemy.” It brought in profits sometimes in excess of $15,000 per truckload, Cruden said.
Over the course of about two years, more than 35 million gallons of fuel were sold for more than $145.5 million, he said.
Three corporations at the heart of the scheme were also sentenced for their joint liability in the scheme, he said.
All of the other defendants in the case have pleaded guilty and were awaiting sentencing. Another co-conspirator, Brian Carmichael, received a five-year sentence while agreeing to cooperate with the government.
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