Former CEO of Imperial Petroleum convicted with securities fraud in RIN scam

In Indiana, U.S. Attorney Josh J. Minkler for the Southern District of Indiana announced the guilty verdict after an eight-day jury trial of Jeffrey Wilson of Evansville, Indiana, who was charged with securities fraud related to a massive multi-state fraud scheme.  Wilson’s crimes centered on the e-biofuels biodiesel business in Middletown, Indiana, which was a wholly-owned subsidiary of Imperial Petroleum.  Wilson, the Chief Executive Officer (CEO) and President of Imperial Petroleum, was convicted in federal court before U.S. District Judge Sarah Evans Barker for the Southern District of Indiana Wednesday night for securities fraud, filing false reports with the Securities and Exchange Commission (SEC), falsely certifying reports to the SEC, lying to the company’s outside auditor and lying to federal investigators.

The underlying fraud involved Furando and Tracy purchasing biodiesel through their New Jersey companies CIMA Green and Caravan Trading.  The conspirators knew that this biodiesel had already been used to claim tax credits and an EPA credit associated with renewable fuel, known as a “renewable identification number” (RIN).  Furando and Tracy would sell this biodiesel to Carmichael and the Ducey brothers, who used the e-biofuels facility in Middletown, Indiana, to pretend to manufacture what they had bought and then illegally reassigned the tax credit and the RIN.  On average, the conspirators added in excess of $1.60 per gallon for doing nothing to the biodiesel other than move it around.

All told, the underlying fraud involved more than $140 million in revenue and $56 million in criminal profits.  The securities fraud case tried over the last eight days involved over $20 million in loss to investors and a $25 million attempted fraud that was foiled by a due diligence team inspecting the e-biofuels facility.