A Ridgewood woman was among two Bergen County residents arrested and charged this week with conspiring in a $100 million alternative energy tax scheme with an Indiana-based biofuels company, according U.S. Attorney Joseph Hogsett.
Evelyn Katirina Pattison, aka Katirina Tracy, 27, was arrested at her Ridgewood home Wednesday, Northjersey.com first reported. She was charged along with Upper Saddle River resident Joseph Furando and four Indiana businessmen with what Hogsett called “the largest tax and securities fraud scheme in Indiana history.”
Federal authorities allege that
between July 2009 and May 2012, Furando's Park Ridge-based Caravan Trading
Company and CIMA Green, two companies where Pattison was an executive, conspired with E-Biofuels, LLC in
Indiana in mislabeling its biofuel products to obtain tax credits and higher prices from customers.
Under the Energy Independence
and Security Act, passed by Congress in 2007, manufacturers are
eligible for a one dollar per gallon tax credit for production of pure
According to an indictment filed in Southern Indiana U.S.
District Court, the three companies sold 35 million gallons of biofuel
that had been blended with petroleum for the market, falsely passing it
off as government certified, high-grade biodiesel.
The mislabeling allowed the companies to falsely
claim $35 million in tax credits, as well as overcharge customers by $55
million, according to authorities. The products earned a higher price
because certain companies are required by law to buy renewable
energy credits, which are attached to the purchase pure, newly produced biofuel.
“Congress enacted incentives for the production of biofuels to make the United States stronger and more energy efficient,” said Robert G. Dreher, acting assistant attorney general for the Justice Department’s Environment and Natural Resources Division. “Fraud by parties claiming such incentives threatens these important public policies.”
Hogsett said that the alleged scheme, which defrauded the government and other fuel companies, caused millions in additional losses to investors.
The investigation into scheme was first reported last year, after an FBI raid on the Caravan offices. At the time, Furando told The Record that the investigation was not focused on his company, which he had said was cooperating with a broader probe of fraud in the industry.
An 88-count indictment of the six defendants includes charges of conspiracy, wire fraud, obstruction of justice, money laundering and securities fraud, according to Hogsett. If convicted, each faces up to 20 years in federal prison.According to court documents, the trial is scheduled to begin in Indianapolis Federal Court in November.