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Carbon-Expert: Another boiler room scam?

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Carbon-Expert is another company selling carbon credits as an investment. As with other companies selling carbon credits, the question is whether this is another boiler room scam. Carbon-Expert’s website certainly includes potentially misleading information.

Such as this, attributed to Fortune Magazine (but undated): “All the big global investment banks including Barclays, Citigroup, Goldman Sachs and Merill [sic] Lynch are hurrying into carbon finance.” A Google search for the statement reveals that the same statement also appears on the websites of Edgebrook Carbon Invest, Eco Carbon Credits, Carbon Discount and Advanced Global Trading. The statement may have been true several years ago, but the reality today is that several banks have closed their carbon trading desks or laid off staff, when they are not being raided by the police for involvement in value added tax scams.

Here’s another, attributed to Barclays (also undated): “United Nations carbon credit prices may rise as much as 42% by 2012.” This is from a Bloomberg article dated 29 October 2010, and is a quotation from Trevor Sikorski, a London-based analyst at Barclays Capital. In December 2012, the price of UN carbon credits crashed to 15 cents. In any case, Carbon-Expert, according to its website, sells “VCS verified Carbon Offsets”, voluntary carbon credits, in other words, not UN credits.

In a comment on REDD-Monitor, David Martin, the Managing Director of Carbon-Expert, wrote, “I set up carbon expert in an ethical and transparent way, with a specific set of ethics and rules.” Perhaps wisely, he doesn’t explain what those ethics and rules are.

Carbon-Expert was incorporated in the UK in April 2012, with David Martin as the only director. The company’s website was registered nine months previously. The company’s registered office is 50 Jermyn Street in London – an address offered by several virtual office companies. Carbon-Expert also has an office in Marbella, Spain.

The company’s website includes the names and photographs of five of the people who work at the company. In a 2012 “Meet the Team” company presentation, Carbon-Expert claims to be “The UK’s Leading Carbon Trading Company”. The presentation includes eight more people who work (or worked at the time) at Carbon-Expert:

In addition to its main website, Carbon Expert also has two blogs: carbonexpert.wordpress.com and carbonexpert.blogspot.com. The most recent article on both is dated January 2012, with the headline: “How to profit from trading carbon credits”. The article includes this paragraph:

Private investors, through a carbon credit broker, can get access to these credits on exchanges, and trade rising demand for credits to make a profit and to channel funds into these projects, helping them grow.

Another potentially misleading statement. The article does not point out one of the key problems with carbon credits as an “investment”, which is that that older a carbon credit is, the less it is worth.

Carbon-Expert’s website includes a list of companies that it is working with. A series of press releases explains more. Carbon-Expert also puts out a newsletter. The most recent, for April 2013, boasts of projects with Emirates Palace Marina, The Arabian United Float Glass Company, and “a collaboration agreement with one of the biggest hotels in Dubai to measure their carbon footprint whilst assisting them with their environmental policy”.

In October 2012, Carbon-Expert announced that a UK-based building firm, TAG Construction (UK) Ltd, had engaged Carbon-Expert and “committed to working towards becoming a carbon neutral company”. Strangely, however, there is no mention on TAG Construction’s website of their aim to become “carbon neutral”. Neither is there any mention of working with Carbon-Expert. All there seems to be is a vague statement about taking “environmental responsibility very seriously”, aiming “to implement suitable policies and arrangements”.


UPDATE – 5 April 2013: See the response from TAG Construction (UK) Ltd’s David Mullett to REDD-Monitor’s questions, below.


Carbon-Expert’s website features a series of logos: APX, SIPP, Carbon Trust, and NYSE Blue. APX describes itself as “the leading infrastructure provider for environmental and energy markets”. There is no mention of Carbon-Expert on APX’s website. SIPP stands for self-invested personal pension, which is a UK-government approved personal pension scheme. SIPP investments in any carbon credits are tax free. Carbon-Expert claims that,

Carbon-Expert liaises with regulated pension experts during the early due diligence stages to ensure that each individual investment is SIPP qualified. The structure and paperwork of all our recommendations have been designed in accordance with SIPP guidelines.

The Carbon Trust is a UK-based company that provides advice to governments and companies about low carbon developments. There is no mention of Carbon-Expert on the Carbon Trust’s website.

NYSE Blue is a carbon trading joint venture between APX and NYSE Euronext, established in 2010. The company’s website seems to be down.

In his comment on REDD-Monitor, David Martin asks people to ring him so that he can “give you a true and honest picture of a market as a whole, as opposed to opinion, advice, or any comment that can be passed on this forum”. In fact, Carbon-Expert’s website provides an excellent picture of the market as a whole, in its risk warning:

Risk Warning: All carbon credits have been duly vetted and full due diligence has been carried out on them; however the purchase of these may not be suitable for all investors. The purchase of these as an investment is consider [sic] for the less risk adverse and you should be reminded that investments can go down as well as up and an investor may get back less than the amount invested. Information on past performance, where given, can not necessarily be a guide to future performance.
 
Carbon Expert, the carbon credits introduced and any associated companies offering them, are not regulated by the Financial Services Authority and therefore there is no recourse to any regulatory compensation schemes such as the Financial Services Compensation Scheme (FSCS) or Financial Ombudsman Service (FOS).

 

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Leave a Reply

  1. There’s an interesting exchange in the comments on Phillip Stovold’s blog:

    Steve Green April 2, 2013 at 12:58 AM

    Hi Phillip,

    Can you assist me with my vcs as I am still trying to liquidise 10 months after first asking. I appreciate you are only consulting for Carbon but would appreciate a bit of help
    Thanks

    ==
    Phillip Stovold April 2, 2013 at 2:26 AM

    Hi Steve – sorry to read you are having this problem – my last project for Carbon-Expert was in September 2012, so it’s difficult for me to influence them there. David Martin is the MD and in the same office as the main team, and probably your best bet if you have been left out of the process. I trained a lady called Moya McKeown who was managing the B2b side of things and had a team dedicated to B2b credit sales, when I left there was a major pipeline for credit placement, much of it from the UAE. I thought you were already on the way out when I left, as I think we had put a small batch of your credits through for placement in early summer 2012. Contact me if you don’t have any joy with them, and I’ll see whether I can help. Good luck, Phillip.

  2. On 5 April 2013, I sent some questions to TAG Construction (UK) about their “carbon neutral” project with Carbon-Expert. David Mullett, director at TAG Construction (UK), responded as follows:

    REDD-Monitor: Could you please confirm whether you are indeed working with Carbon-Expert.

    David Mullett: Yes

    REDD-Monitor: Please also describe the services that Carbon-Expert has provided since October 2012.

    David Mullett: They are measuring our carbon footprint

    REDD-Monitor: Is the carbon neutral project still on-going and if so when do you expect that TAG Construction (UK) will achieve “carbon neutral” status?

    David Mullett: Yes. We have only recently completed the information required by Carbon Expert so I would assume it might be three to four weeks before we see any reports on our carbon footprint.

    REDD-Monitor: What proportion of the “carbon neutrality” will come from reducing TAG Construction (UK)’s emissions and how much will be “offset” by buying carbon credits?

    David Mullett: As yet we do not know there are obvious areas where we can reduce our emissions and we are hoping they can point out a few that we are not aware of. We do not yet know the offset of buying carbon credits to attain carbon neutrality and as we are under no pressure to obtain carbon neutrality it is our decision as to if and when we decide to purchase carbon credits to obtain neutrality or we use the next twelve months reducing our carbon footprint. I would add we are tied in to Carbon Expert in the purchase of carbon credits and will go to the market as and when we decide to purchase carbon credits.

    REDD-Monitor: Why is there no mention of any of this on TAG Construction (UK)’s website?

    David Mullett: Our website is currently being rebuilt as it was first designed in 2009 and between 2009 and 2013 we have attained a number of additional certifications to enhance the profile of our company, carbon expert included.

    I trust the above is of assistance and clears up a few of your questions. I would point out that we are not investors in the carbon market, we invest in the business we know “Construction”.

  3. David Martin is also the sole director of a company called The Wealth Advisory Limited (company founded on 29 January 2013, website registered on 8 January 2013). (The websites of both Carbon-Expert and The Wealth Advisory were down earlier today, but they are both now back up.)

    When he’s a wealth advisor, Martin wears a blue tie. As a carbon expert, he wears a green one:

  4. I was approached by a company called Carter & Campbell, assets and portfolio management who claim they can arrange to have useless voluntary credits removed from VCS registry and have them converted to negotiable credits which they say they can sell by September for a price of £11 per credit. they’re charges are 3% of the sale price paid in advance.
    I assume I am looking at a new slant on the carbon credit scam praying on the natural aspiration that there is a way that you will recover your investment.

  5. @Tom Arnott (#4) – You posted a comment about Carter & Cambpell Asset Management last week. Carter & Campbell is running a recovery room scam – see my response to your previous comment, here.

  6. Some time ago David Martin of Carbon Expert came to my home as I wanted clarification of what would occur if I paid a ‘client fee’ to Carbon expert, with a view to liquidating my credits through such projects as Dubai Marina for whom they were conducting a foot print estimate for. I too spoke to a company in UK and they confirmed they were being ‘foot printed’ but had no plans to purchase. The MD did confirm they were “tied to Carbon Expert” IF they bought credits. I think this was TAG also? Anyway David, on his visit, verbally confirmed that my ‘client enrolment fee’ would effectively be used to enable Carbon Expert’s continued development of projects with the likes of Dubai Marina, TAG etc. In the HOPE they could then use this relationship to sell their ‘clients’ credits. HOWEVER, David could give no guarantee that my payment would result in exit from my credits.. of which I do have a shed load! It became clear to me that, this was another way to throw good money after bad with no comeback! Interested by the rhetoric and impressed by the personal visit though I was, I happily refrained. Particularly as David’s presentation differed to that of his team member in Marbella, who was adamant that I would be able to exit my credits with Carbon Expert!
    As for investment in Films? Been there too, more chance of loss than gain in my albeit limited experience. What will they think of next!

  7. @Bob (#6): I think you made the right decision not to take him up on his offer. Didn’t realise David Martin was paying home visits, makes him sound more like a double glazing salesman than alternative investments genius. Glad you wasted some of his time.

  8. I cannot understand how the MD such as David Martin is allowed to work as a MD as another company director , given a government grant for producing a film . He has cheated so many people and want to know where it is gone. Money obviously got laundered out of UK , and shared with Carbonex SARL and Carbon Expert ? Makes my blood boil.

  9. Carbon-expert are the biggest scam ever as they are still in business. Have escaped the law-and go on with new name and cheat even more people. There is no justice— I do believe he will get caught one day by someone who would teach him a lesson of the lifetime.